A decade of fruitful journey for Nigeria's Lekki Free Zone under BRI
Photo taken on Dec. 16, 2015 shows the Lekki Free Zone, approximately 50 kilometers from Lagos, Nigeria. (Xinhua/Jiang Xintong)
The year of 2023 marks the 10th anniversary of the Belt and Road Initiative (BRI). Throughout this decade, BRI has transitioned from a conceptual framework to a tangible force, fervently supporting the global free trade system and fostering an open world economy. Propelled by the momentum of the Belt and Road, Nigeria's Lekki Free Zone (LFZ) is emerging as a crucial hub for China-Nigerian and China-African economic and trade partnerships.
Endorsed by the Chinese government as a national overseas economic and trade cooperation zone, LFZ spans 30 square kilometers within Lagos State, Nigeria. It is operated under a joint venture, China-Africa Lekki Investment Ltd. (CALI), which is jointly invested by the China Civil Engineering Construction Corporation (CCECC) under China Railway Construction Corporation Limited (CRCC), China-Africa Development Fund (CAD FUND), Nanjing Jiangning Economic and Technological Development Corporation, Nigeria's Lagos State government and Lekki Worldwide Investments Limited. CCECC serves as major operator of LFZ project.
-- An important platform for Chinese companies entering African market
As of June 2023, LFZ boasts registrations from 175 companies, with 116 of these entities having signed investment agreements to open businesses within the zone, comprising 73 Chinese firms and 43 international ventures.
Key companies in the zone include Pinnacle Petroleum, Longrich (toothpaste manufacturing), Bollore, Win Electronic Appliances, Yafei Automobiles, and Langsung Electric.
In the first half of 2023, businesses within the zone reported imports and exports amounting to 28 million and 70million U.S. dollars, respectively. As of now, LFZ has successfully attracted investments exceeding 200 million U.S. dollars.
Zheng Jun, Chief International Business Expert of CCECC, emphasizes the strategic location of LFZ as a primary advantage, noting that it marks CCECC's inaugural overseas development. After over a decade of sustained growth, LFZ has emerged as an indispensable conduit for Chinese enterprises seeking entry into African as well as European markets, establishing itself as an influential hub within Nigeria and Africa under the BRI.
Moreover, CCECC has cultivated invaluable expertise through the construction and management of LFZ, applying this knowledge to the development of other international zones and catalyzing a fresh wave of growth for CCECC's worldwide ventures, Zheng added.
-- Port-zone synergy revitalizes economy
As China's inaugural investment-controlled large-scale, multifaceted deep-water port in Africa, Lekki Port stands among West Africa's premier deep-water harbors, boasting an annual throughput capacity of 1.2 million TEUs. Upon completion, it is projected to yield an astounding 361 billion U.S. dollars in cumulative economic gains for Nigeria over its 45-year concession tenure.
Lekki Port plays a crucial role in galvanizing the port-centric economy of southwest Nigeria and the neighboring industrial parks, free trade zones, and urban development. Interconnected with LFZ and the Lagos Free Zone, where Lekki Port is located, the Port is expected to effectively invigorate Nigeria's manufacturing, industrial, and services sector, which will yield a positive impact on the revenue streams of both the Lagos State and the federal government, along with enhancing local job creation opportunities, said Sun Hong, deputy director of the Center for South-South Cooperation at the China Institute of Contemporary International Relations (CICIR).
Lekki Port emerges as a hallmark accomplishment in the collaboration between China and Nigeria, as well as in the broader context of China-Africa under the BRI. The fruition of Lekki Port will significantly mitigate the existing cargo shipping pressure at Lagos Port, expedite the velocity of cargo transshipment and amplify the port's throughput capacity, servingas an efficacious solution to Nigeria's infrastructure impediments hindering economic progress, according to Sun.
Lekki Port will enable Lagos to become the maritime logistics hub of the Central and West African region, paving the way for the unleashing of Nigeria's economic potential and a surge in national revenue, said Babajide Sanwo-Olu, the governor of Lagos state.
LFZ is poised to capitalize on the strategic location benefits conferred by Lekki Deep Seaport, fostering a diverse array of industries including fine chemicals, harbor-centric industry, manufacturing, commerce, residential development, and cultural and leisure facilities across its expansive terrain, aiming to createan integrated, forward-looking urban center and establish LFZ as a parag on of China-Africa and China-Nigeria collaboration.
-- China-Nigeria cooperation to share a promising future
Under the BRI, economic and trade engagements between China and Africa, as well as China and Nigeria, have been intensifying, with an enthusiastic thrust in collaborative projects. LFZ is expected to further promote industrial cooperation between China and Nigeria.
Currently, LFZ is meticulously enhancing its internal infrastructure. The investment, construction, operation, and maintenance of the power plant have been delegated to the specialized company, Jiangsu Communication Clean Energy Technology Co., Ltd, under a franchise model. The zone now features natural gas pipelines that traverse its expanse, extending to the Dangote Fertilizer Plant, and has been designed with provisions for future connectivity.
In addition, LFZ also built a water treatment facility for its own use with a daily processing capacity of 3,000 tonnes. This year, the zone is slated to finalize the installation of water supply pipelines serving the initial development's office building and the primary water-dependent enterprises within the industrial sector.
The free zone is also set to prioritize the cultivation of chemical industries as well as those related to oil and natural gas. The Dangote project, whichis currently under construction and is anticipated to commence operations within the next two to three years, is expected topave the way for LFZ to robustly evolve its downstream chemical and oil and natural gas sectors. In tandem with the expected clustering effect in the oil and natural gas industries within this region, LFZ will be proactively and strategically leading investment-attracting initiative, aiming to entice cornerstone enterprises in the downstream chemical sector, optimize the utilization of by-products from the Dangote Refinery, and foster the establishment of a comprehensive industrial value chain.
After years of evolution, China's chemical and oil and gas sectors have established a sophisticated technological ecosystem that embodies safety, environmental sustainability, and efficiency. These industries are poised to bring Nigeria holistic equipment solutions, invaluable experience, and technologies tailored for local application. Concurrently, LFZ is adeptly equipped to facilitate the seamless transfer of these capacities.
As the 10th anniversary of BRI, insiders at LFZ believe that having braved the challenges posed by the COVID-19 pandemic, the zone's construction and efforts in attracting investments are well-prepared for exponential growth, leading to an influx of companies establishing their presence within the zone in the coming years.