What Nigeria, Singapore stand to gain from investment promotion, protection pact –Ambassador Rajis-Opara
From today, negotiation on the Investment Promotion and Protection Agreement (IPPA) between Nigeria and Singapore will start in Abuja, aimed at enhancing business between the two countries.
Revealing this in an interview with the African Independent Television (AIT), Nigerian High Commissioner to Singapore. Mrs. Nonye Rajis-Opara, said there would be the second and, perhaps, the final round of negotiation on the agreement between the two nations.
She said although Nigeria had entered many bilateral agreements with Singapore, IPPA would further enhance businesses between the two countries.
She spoke on this and other issues.
How has it been since you took over in Singapore.
It has been well and is still very impactful, but not without some challenges. Relations between Nigeria and Singapore have multiplied in folds since I took over in 2012. This was made possible by the upgrading of the Mission and the posting of a High Commissioner to head the Mission.
How well did the bilateral agreements between Nigeria Singapore do?
As we are well aware, bilateral agreement between a country and its host is very significant in making sure that both countries are well-represented and protected from domestic laws and regulations. There is currently one functioning bilateral agreement between Nigeria and Singapore, which is the Bilateral Air Service Agreement (BASA) Cargo Services. The cargo services commenced operations between Nigeria and Singapore in 2012. Negotiations on the Bilateral Air Service Agreement (Passenger Fights) and the Avoidance of Double Taxation Agreement (DTA) have been concluded. The BASA and DTA are scheduled to be signed at the sidelines of the second Nigeria-Singapore Business and Investment Forum (NSBIF2015) on August 4, 2015, in Singapore. Negotiation on the Investment Promotion and Protection Agreement (IPPA) is ongoing and the host team is scheduled to be in Nigeria from June 1-2, 2015, for the second and, hopefully, the final round of negotiation.
What are the details of BASA?
The BASA between Nigeria and Singapore has been outstanding since 1990. International air service has been as much a function of government policy as it has been a function for commercial considerations. Under the current text of the BASA, passenger air carriers from Nigeria and Singapore will have the flexibility to operate any number of air services between and beyond both countries. Singapore Airlines Cargo currently operates twice a week freighter services to and from Singapore. The main denominator in the negotiation of BASA is reciprocity, and before it is signed, the contracting countries must be satisfied that the agreement ensures both parties are equal beneficiaries. In the event that one party cannot reciprocate due to the absence of its own national carrier, it collects royalties from its performing partner. The absence of a national carrier and local operators to reciprocate the BASA, Nigeria has for long been a recipient of royalties. Singapore, an advocate for the aviation industry, seeks to promote an environment where enterprises thrive, ideas flourish and innovation prevails. Singapore supports the introduction of new aviation technology, products and processes and works with the industry to develop and enhance its capabilities.
Could you tell us about the DTA?
The DTA between Nigeria and Singapore has been outstanding since 2008. Avoidance of Double Taxation Agreement (DTA) serves to relieve double taxation of income that is earned in one country by a resident of the other country. When signed, the DTA will make clear the taxing rights between Nigeria and Singapore, on the different types of income arising from cross-border economic activities. It will also provide a reduction or exemption of tax on certain types of income.
With the intervention of the High Commission under my watch, officials of the Inland Revenue Service (FIRS) and the Inland Revenue Authority of Singapore (IRAS), held the first round of negotiations on the DTA in October 2013, at the sidelines of the first Nigeria Singapore Business and Investment Forum. In the aftermath of the first round of negotiation, Nigeria and Singapore negotiating teams have been communicating to resolve the outstanding issues. In October 2014, both parties were able to successfully reach an agreement on all the issues. Mission was informed by the Inland Revenue Authority of Service (IRAS) that Singapore is now waiting for the Federal Inland Revenue Services (FIRS), to initial on the agreed text, which Singapore had already initialed. Following the initialing, both sides can then proceed to sign the DTA, during the second Nigeria-Singapore Business and Investment Forum 2015.
What of the Investment Promotion and Protection Agreement (IPPA)?
Nigeria’s economic ties with Singapore have continued to grow over the years. The key features of the IPPA include non-discriminatory, fair and equitable treatment for Nigerian investors and investments in Singapore and vice versa; prompt, adequate and effective compensation in the event of expropriation as well as guarantee of free transfers of capital, returns, proceeds and other payments and access to international arbitral tribunals in the event of any investor to state disputes.
Nigeria and Singapore are very much closer to concluding the IPPA. On number of issues, Nigerian and Singaporean positions are not that far off, as both parties seek to balance the interest of investors and the state. It was based on these mutual benefits that the Singapore team is scheduled to be in Nigeria from June 1-June 2, 2015, for the second and final round of negotiation. At least, 41 countries or economies have adopted economic policy measures affecting foreign investment, with countries particularly in Asia. Numerous countries adopted policies to strengthen the role of the state in the economy. Measures taken include, open markets, aviation training, stronger regulation of the financial sector, as well as, investment protectionism, which still remains a serious potential threat to the foreign direct investment (FDI) recovery, particularly hidden in the implementation of existing laws. At the international level, 50 new countries continued to conclude new investment agreements between 79 economies. Notable is the continued trend towards signing Double Taxation Agreements (DTA) and Investment Promotion and Protection Agreement (IPPA).
The status of Singapore as a trusted, transparent and well-established international financial centre with world-class standards continues to diversify and opens its doors to the world by offering business friendly platforms. A foreign investor can settle hassle-free in Singapore and be operational in just 48 hours. Singapore has one of the world’s most generous tax regimes, where goods and services tax are harmonised.
Are we expecting some changes with the new administration?
As you are aware, the foreign policy of Nigeria will always remain the same. Nigeria, as a country, will always have a common interest. The development of foreign policy is influenced by domestic considerations.
In specific terms, could you tell us the outcome or benefits of the last Nigerian-Singapore Business and Investment Forum?
Before the 2013 forum, majority of Singaporeans and businesses do not have a vast knowledge of Nigeria and the investment and business opportunities available. But after the forum, the awareness of the immerse opportunities available in Nigeria and the government policies put in place to attract foreign direct investment were discussed and made available to all the delegates. We saw an increase in the number of businesses applying for Nigerian visa. The Forum also provided a one-on-one matchmaking platform for both Nigerian and Singaporean businesses to meet and exchange ideas. State governments were also able to meet with prospective investors.
Could you yell us about this year’s Business and Investment Forum?
The outcome of the first forum was overwhelming and thus there is a demand for another forum. After taking into consideration the success of NSBIF 2013, we felt that it makes more sense to keep the momentum going. Our host country acknowledged that the NSBIF 2013 was the biggest bilateral event to have ever taken place in Singapore.
I will like to add that year 2010 and subsequent years witnessed an increased economic trend towards investment liberalisation, facilitation and promotion of economic and political relations between Nigeria and Singapore. This is mostly based on the international recognitions achieved by Nigeria, which reaffirms the determination to continuously enhance its investment climate. Nigeria has taken significant steps to enhance its medium for information exchange, legal and regulatory framework with multiple countries.
