Chika’s food processing company is now a success. Within two years of setting up in the Kano FTZ, she has scaled her business, exporting Nigerian agricultural products to markets in Europe and North America. The structured nature of the Free Trade Zone allowed her to bypass many of the difficulties she had initially faced. Today, she employs hundreds of Nigerians and has inspired other diaspora entrepreneurs to explore similar opportunities
By Deji Nehan
Diaspora’s Investment Dilemma
Chika had always dreamed of giving back to her homeland. After spending fifteen years in Canada, she had saved up enough to start a business in Nigeria. Her plan was simple: establish a food processing company that would package and export locally sourced agricultural products to international markets. She believed it was the perfect opportunity—helping local farmers while creating jobs.
Excited, she took her first step by trying to acquire land in Kano state. That was when the reality hit her. Endless paperwork, inconsistent policies, and unexpected levies drained her patience. When she finally secured land, infrastructure became her next battle. Power supply was unreliable, and transporting goods from rural areas to the city was a logistical nightmare. Frustrated, Chika reconsidered her decision. Would it have been better to invest in Canada instead?
Just as she was about to give up, a friend introduced her to Nigeria’s Free Trade Zones (FTZs). She had heard about them in passing but never explored their benefits. With renewed hope, she visited the Kano Free Trade Zone. What she discovered changed everything.
The Diaspora as a Key Economic Driver
Chika is not alone. Many Nigerians in the diaspora are eager to invest back home. Every year, remittances from Nigerians abroad exceed $20 billion, making the diaspora one of the country’s largest economic drivers. However, much of this money is directed towards personal projects like family support and limited real estate, rather than productive business investments.
The hesitation is understandable. Bureaucratic bottlenecks, insecurity, and poor infrastructure often discourage those in the diaspora from starting businesses in Nigeria. But Special Economic Zones (SEZs) and Free Trade Zones provide an alternative structured and supportive environment for entrepreneurs like Chika who want to invest without the usual hassles.
Unlocking Opportunities in Free Trade Zones
Nigeria is not the first country to leverage its diaspora for economic growth. China’s Shenzhen Special Economic Zone, once a quiet fishing village, became a global technology and manufacturing hub by attracting investments from overseas Chinese. India’s Gujarat International Finance Tec-City (GIFT City) provides tax-free incentives to Indian expatriates, encouraging them to invest in financial services back home. Ethiopia’s Hawassa Industrial Park has similarly benefited from diaspora funding, creating thousands of jobs in the textile industry.
Free Trade Zones are designated areas where businesses operate under special regulations designed to encourage investment. These zones offer advantages that traditional business environments lack. Investors in FTZs enjoy tax breaks, exemption from customs duties, and access to well-developed infrastructure such as roads, ports, and stable electricity.
Currently, Nigeria has more than 40 licensed Free Trade Areas, of which around 15 are fully functional having some of the most renowned such as Lekki Free Zone one of the most prominent, Onne Oil and Gas Free Zone, and Calabar Free Trade Zone, Ogun-Guangdong Free Trade Zone, and Kano Free Trade Zone among others. Each of these zones is designed to attract businesses in manufacturing, agriculture, technology, and logistics.
For Chika, the Kano Free Zone provided a ready-made business environment. The process of setting up her company was much simpler than outside the zone. Business registration was handled at a one-stop investment centre, and she didn’t have to worry about multiple taxation issues. Most importantly, she had access to reliable infrastructure, allowing her to focus on production rather than survival.
Government Policies and Investment Incentives
Recognising the potential of diaspora investors, the Nigerian government has introduced several policies to make Free Trade Zones even more attractive. Businesses operating within these zones enjoy complete exemption from federal, state, and local government taxes. Import and export duties are waived, making it easier for companies to trade internationally.
The Nigerian Investment Promotion Commission (NIPC) has also rolled out special incentives targeted at the diaspora, including easier access to land and funding opportunities through grants and low-interest loans. Programs like the Diaspora Investment Summit have been introduced to link Nigerian entrepreneurs abroad with local business opportunities.
Despite these efforts, challenges remain. Some investors still encounter delays due to inconsistent government policies and occasional bureaucratic inefficiencies. However, many success stories show that with the right strategy, diaspora investors can navigate the system and thrive.
Diaspora-Owned Businesses Thriving in SEZs
Chika’s food processing company is now a success. Within two years of setting up in the Kano FTZ, she has scaled her business, exporting Nigerian agricultural products to markets in Europe and North America. The structured nature of the Free Trade Zone allowed her to bypass many of the difficulties she had initially faced. Today, she employs hundreds of Nigerians and has inspired other diaspora entrepreneurs to explore similar opportunities.
Other investors have also found success within Nigeria’s FTZs. Crown Flour Mill, located in the Calabar Free Trade Zone, has leveraged tax incentives to expand its operations, benefiting from duty-free imports of raw materials. The Arise Integrated Industrial Platform, which has attracted diaspora-backed funding, is developing large-scale industrial hubs in Ogun State. These examples prove that when given the right environment, businesses can thrive, and investors can reap significant returns.
Lessons from Other Countries
Nigeria is not the first country to leverage its diaspora for economic growth. China’s Shenzhen Special Economic Zone, once a quiet fishing village, became a global technology and manufacturing hub by attracting investments from overseas Chinese. India’s Gujarat International Finance Tec-City (GIFT City) provides tax-free incentives to Indian expatriates, encouraging them to invest in financial services back home. Ethiopia’s Hawassa Industrial Park has similarly benefited from diaspora funding, creating thousands of jobs in the textile industry.
Nigeria has the potential to replicate these successes, but this requires consistency in government policies, improved security, and further simplification of the investment process. If properly managed, Free Trade Zones could serve as a key driver for industrialization and economic transformation.
The Time to Invest is Now
For Chika, the decision to invest in Nigeria’s Free Trade Zones turned out to be the right one. By taking advantage of the available incentives, she overcame the common challenges faced by diaspora entrepreneurs. Her story is proof that while doing business in Nigeria can be difficult, strategic choices—like leveraging SEZs can make the journey smoother.
The question now is: will more diaspora investors follow this path? With the right policies in place and a commitment from stakeholders, Nigeria’s Free Trade Zones could unlock billions in investment, create jobs, and transform the economy. For those in the diaspora looking for a way to invest back home, the opportunity is here. The time to act is now.
•Contributed by Deji Nehan – Diaspora Diary.
The vision is to contribute to the development of Nigeria by leveraging the insights and experiences of the diaspora community. We aim to create a platform where knowledge and ideas can be shared freely, fostering a collaborative environment that drives progress and innovation. Our mission is to provide thought-provoking and actionable insights that can help shape policies, guide investments, and ultimately contribute to building a better future for Nigeria.
