Fri, 06/07/2012 ? 3:16am | BEN NDUBUWA Interviews Features

The Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) is the umbrella organisation for the Organized Private Sector (OPS). In this interview with Ben Ndubuwa, the Director-General of NACCIMA, Dr. John Isemede, speaks on the drive for Foreign Direct Investment (FDI) as well as NACCIMA?s involvement in public-private sector partnership (PPSP) with government.

What are the key economic challenges facing the Organized Private Sector (OPS)
The government should develop a national rolling plan. Before now, this country was not run on budget. Budget is a financial estimate. After the world war the Germans had a marshal plan. We have seen plans in Japan and other part of the world and we have seen how people are prepared for the 21 Century.

But ours is being run by budget.  In the past this country?s economy was not run on yearly budget. The most worrisome aspect of it is that this budget is tied to one commodity ? oil. That means if the price of oil goes down the country suddenly falls flat. What is happening to the economy is not that we do not have the manpower, but it seems that we are eating from hand to mouth.

Let us have structures and plans that, in five years, we want to see the railway back on track; in 10 years, we want to see electricity everywhere; in five years we want to see water flowing everywhere, the dams, and all that.These are not the technology of tomorrow; these are what some countries have passed a hundred years ago.

These are the things affecting our economy. What we are saying is, let us have Public-Private Sector Partnership (PPSP) because government cannot do it alone.

And if the environment is good, people will come to invest.In this short period that Dr. Olusegun Aganga is the Minister of Trade and Investment, we have noticed the positive impact on the economy regardless of the insecurity in the country. Foreign Direct Investment (FDI) into the country for this short period is about $7 billion.

This is a man that, when he was the finance minister, what he did was a bailout to support SMEs and big industries with the help of the Bank of Industry (BOI). Nigeria is a country where people have thrown patience to the winds; people only believe in miracles and nobody wants to know that two plus two is four.

Also with the government transformation agenda, we have also noticed that this is in line with our vision of partnering with the government. We expect that government should provide the airport and the necessary equipment while the private individual provides the aircraft.

This is the spirit of PPSP. Government will provide the railway while the individuals will provide the wagons or government should sell the railway entirely. In the power sector, the problem is not only in generation but distribution as well. If you produce from the present state of 3,500 MW to about 200 percent, how do you distribute.

What we want is to come closer to government so that the government will now adequately ascertain their responsibilities of providing the enabling environment and partner with us.

Is it true that the government never had enough consultation with the OPS on the issue of power reform?
Our role in business is advisory. We have travelled round the world; we know how things are done in other countries, so we advise appropriately. NACCIMA is a body that doesn?t talk anyhow. Before we make any pronouncement, we would have done our research and have our facts and figures.

We always tell the government to look at the other side of the coin. We don?t say government must do this or that. We as people also have a stake in this country, but we advise the government based on facts and figures. We never say that government did not consult us with regard to the power reform. We were represented in most of the meetings and town hall meetings.

In the area of power sector, government has been close to us, though we are still telling the government that if we are going to pay more, there is the need for other forms of incentives for the organized private sector. Are we going to have credit facilities? Also, we are saying that the technology of telecommunication is not the same with that of power.

For instance, with one mast you can serve thousands of people in your network, but in the case of power, the bulb in my office is connected to the meter, from the meter to the high tension wire and to the transformer, then to the distribution and transmission lines leading to the power plant. So, the power sector is more involving than any other sector.

We are ready to partner with the government, but what we are saying is that government should not over-tax us because we are in competition with other people from the other parts of the world. So, if we don?t produce at a lower cost, we will not be able to compete and to compete is to take up the world.

In the past, there was a flurry of visitors with NACCIMA hosting foreign visitors.  Are trade delegations no longer coming into the country?
No, that is not correct. We are in charge of all trade fairs ? both local and international. The Nigeria Export Promotion Council (NEPC) is also involved. We are fully involved in trade delegations as well. We just came back from three nations? tour, including Turkey, Malaysia and Indonesia, and last year we went to 10 different nation delegations.

And did not go there alone; we went with some people. We have other chambers across the country. They also look at their peculiar situation and position and embark on trade missions. For instance, Port Harcourt does undertake trade missions on oil and gas. Abuja Chamber also embarks on trade missions as well. T

hey get approvals from NACCIMA ? being the umbrella organization –  which they are members. NACCIMA is an active organization. Yesterday, I was with people from Hong Kong and on weekly bases people come from the far east Asiatic countries and from every part of the world, and we are here on one on one discussions. We also use emails and text massages to communicate. So if you don?t see these on the pages of newspapers, it does not mean that things are not going on via ICT.

Most times we communicate online. So Information Technology has helped to capture most of these trade transactions.

Also, there were some international trade agreements that were signed in the past; many of them were not in favour of this country and NACCIMA has taken a step forward to work with the Ministry of Trade and Investment, Foreign Affairs and National Planning to ensure that these agreements are not misrepresenting Nigeria and to review Nigeria?s place in these agreements.

How can you sign an agreement, for instance, for aircraft coming to Nigeria and you are talking about wet and dry leasing which nobody can implement and Nigeria cannot have a say on such agreement? What is also the point signing an agreement on shipping that allows 40:40:20 agreement, in which ships carrying goods into the country, the Nigerian partner involved will have 20 percent, your partner 40 percent and your competitors 40 percent.

This is because Nigerians are not the owners of these ships. These are some of the things we are looking at. Now, we used to have idle EPZs out of the 25 EPZs, about six are fully operational. Go to Lekki Free Zone, go to Calabar and other free trade zones, things are working. These are the handiwork of NACCIMA?s involvement and we are not stopping there.

So, we cannot say things are not working; go to the EPZs and see things for yourself. Last year, when we travelled to countries in the Far East, we discovered that Nigeria has lost out being tied to the West for so long; because the Asian countries have gone far. We have been with the west for 300 to 500 years; what have been we been able to achieve.

If it is not military support, it is a fair elections. When there is trouble, they always claim that they want to support us; that support I don?t know. They come in with donor agencies; they give you with the right hand they take it with the left. They are not prepared to take our agricultural produce. They are not prepared to take our finished products.

They introduce all sorts of standards just to take our resources away and bring them back hundred times the price. I had the privilege to address some Nigerian students and professors in Oxford University and I pointed out to them that if Nigerians and Africans can come here as students and top their various classes and they can attend the best universities, Oxford and Harvard, and come top in their various courses, and have gone to the best organization such as the World Bank and proved to the world that we are the best; why then is the West reluctant to take our own products and why are they not investing? Instead they choose to divest.

That is why most of these multinationals that we use to know and were popular in the 50s and 60s are today shadows of themselves. Many of them that called themselves managing directors are mere salesmen today. Now, the Far East is coming and they are telling us of a new agreement. Before the coming of the Chinese, the Indians and the Koreans,  the Turkish, were there any negotiations?

The West decided what we pay for their finished products imported into our country; they decided in what manner we paid. They give all sorts of excuses why we should pay more. That is why it is time to take our own destiny in our own hands and we can do this by going back to agriculture and begin to process our agricultural produce because we can no longer sell raw cocoa bean to them. For over 100 years, we have been selling cocoa beans to them.

How much is a tonne of cocoa beans; how much is a tonne of palm oil; how much is a tonne of cashew nut? Cashew nut today with the FOB price per bag is $600; they take it and re-bag it in a nylon bag or in ?pure water? sachet and they go the Western World and resell it at $4,000 in the international market.

Things are even better in the francophone countries because of the French principle of assimilation. If you go to these countries, you see French influence; whatever they have in France, you see it there. If you have a certificate in these francophone countries, you can use it to work anywhere in the francophone countries and even in France. But in anglophone countries, you have all sorts of issues.

Is it that we cannot break away from all these?
We are not breaking away from anybody and cannot begin to introduce all sorts of measures because we are still a member of the World Trade Organisation (WTO). The only thing we can use is tariff. So if Nigeria says import duties on certain things are 20 percent, if you still want to buy it ? because you are from that country, you are free. In the world today, you cannot stop anything from moving round; that is the WTO law.

To export is to compete, and to compete is to take up the world, and there is no longer home advantage. If there is home advantage, how come that goods coming from China and the Far East, about 16,000 kilometers farther, is cheaper than the goods you produce locally. Before you take any measure, you sit down and review things.

For instance, looking at the various trade agreements ? I happened to have served in the Nigerian Trade Review Policy in line with that of the WTO and the ECOWAS Trade Liberation Scheme (TLS), what we realize was that the pressure on the common external tariff was not pushed by Africans or Nigerians; it pushed by the Western world for them to bring in their goods.

They made us sign the EP  (Economic Partnership). How can I sign an agreement with you on shipping when in the first place I do have a single vessel? Countries like Netherlands have over 600 vessels; we are not even talking about Belgium and all that.

We now sign agreement with them, while they have the capacity and the modern technology to move their goods to our shores, the little we produce, how do we move them? In those days when we left school, things were better; we had a national carrier ? the Nigerian Airways, and Nigerian goods were available in all parts of Africa ? in Congo Brazzaville, South Africa and many of the West African countries.

This helped to distribute our goods around. Not many people know that over 40 percent of what we produce in Nigeria is sold and consumed within West Africa. I took the pain to travel from here by road to Senegal and to Algeria, and the whole of East Africa, Nigerian goods are all over the place. What was moving them? the Nigerian Shipping line.

Where are those things today, if you want to sign any agreement. Now, you are talking of one sub-region when you have two parallel bodies ? the ECOWAS and the CFAs zone. If you are doing business with a man in Benin Republic, when you are shipping goods to him, it is export, and if he is receiving the goods, there it is import.

But if somebody in Benin is selling goods to somebody in Senegal, it is arrival because they have the same clearing system. It is like somebody in Lagos selling some things to someone in Kano. These are some of things people don?t know.

So when some people say ?let?s come together?,  it does not work that way. I have worked with the best multinationals in the world and I have seen that it does not work that way. I started with publishing in Ibadan, selling Things Fall Apart, criss-crossing the length and breadth of Africa.

Then I moved to UniLever and worked in 17 locations from there I worked with Cowbell, representing them in Benin Republic and covered the whole of West Africa. I moved to Cameroon and covered the whole of Central Africa. I then moved to CFAO to sharpen my knowledge on agribusiness, and then to Dangote and worked for them in Senegal before I came here. So some of these things, we know how they work.

Is it possible to have one currency in the West African sub-region when we have over 10 different currencies, and which one of them is more convertible?
If you are talking of a sub-region, we have about 15 countries. How do we place a country like Mauritania, because that country will surely come back. I have travelled from here to Mauritania by road. How many Nigerian know that there are a lot of fish in Mauritania.

In 2008, I travelled to that country, I saw businesses, and for you to do business with these people, it was difficult in the past until the new generation banks came. Even business with the neighbouring countries takes months, and for you to have an LC opened for business can be difficult; you can even be frustrated.

Even some of them will not remit your money even after the business is done.  And if you are talking about one sub region, you are talking about 10 different currencies with only one currency that is convertible. It is the CFA. The CFA was attached to the French Franc as far back as 1941. The whole thing was reviewed in 1992 and 1994 when the CFA was devalued by 50 percent and later by 40 percent, when the people of Niger said they will resort to the naira.

But we were not able to manage our own economy then. The naira was the strongest currency in the world in the 70s and the 80s. The value of the dollar to the naira then was $1 to 25k. What happened to our economy? These are the things we are saying; we are not fortune tellers. I can give you the exchange rates from 1960 to date.

So for a subregion of 15 countries with 10 currencies ? because Guinea Bissau has now converted to the CFA which is tied to the French Franc,  and when France become part of European Union, then the CFA automatically become a convertible currency because the actual value is tied to the French Franc.

Even if France wants to pull out of EU today, we are still going to have the same problem of two parallel bodies in West Africa. Even the Central Bank of West Africa (CBWA) which we have been trying to put in place in the past ten years will now be in two phases, which will entail countries like Nigeria, Ghana, Gambia, that is, those of the anglophone nations, will be in the first phase, then those of the francophone will join in the second phase.

Now, if you are also talking about a sub-region, how can that be without a custom union? Why should VAT be five percent in Nigeria then 20 percent in the francophone  and then 15 percent in Ghana? So if all these things are harmonized, we can now talk about one external tariff, and we can now talk about the economic partnership agreement in one sub region.

In Europe, businesses works well; that is why businesses between France and Netherlands is arrival, whether export or import. Business between Italy and Germany is arrival. So I do see why a truck from Nigeria cannot drive straight to a warehouse in Ghana if truly we have one sub-region.

Are you saying that a country like France does not want us to have one regional bloc because she has interest in the francophone countries?
No, it is not the problem of France. It is because we have problem at home. France plan for the principle of assimilation is different from the plan of other colonial masters. I did my post graduate in Paris and I have worked in other francophone countries. I worked in Ivory Coast, Cameroon, Senegal and Benin Republic.

That is not what I am trying to say. I am saying how these things work. For example, the francophone people in West Africa wouldn?t need to carry French passport and visa, but because they will be required to carry a passport in Nigeria and Ghana, that is the reason for the introduction of ECOWAS passport.

They are all citizens of France. At Independence, they were all deputies in the French parliament. Yes, the way you run your family is different from the way I run mine. Look at the French national team, are they not citizens of France. I am more comfortable in the francophone than in the anglophone. In the anglophone, they look at you as a visitor.

Meanwhile the Frenchman will look at you as brother if you can speak the language. All the francophone countries in both West Africa and Central Africa have the same trade bloc. But Nigeria and Ghana don?t have the same. The requirement in Togo is the same requirement in Senegal.

All these things are the reasons why we have to educate our people. Why do we have up to 100 to 200 trucks lined up at the Seme boarder between Nigeria and Benin Republic? Go and find out. People do not know that if you are moving by road, any product that is registered under the ECOWAS TLS, you are not going to pay duty.

But that one will not prevent you from paying VAT and surcharge. That also will not prevent you from not taking the brown card; the ECOWAS third party insurance cover.

So what is NACCIMA doing to ensure that people are aware of all these things?
I have the big task of developing people and bringing them closer to NACCIMA. Every time, I am at the border. Midnight I am at the border for one reason or the other. Some people will get at the border they will say after all it is ECOWAS.

If I am to go and do some work in Ghana today, I am given 90 days to finish the work; failing to do that, you are required to get resident and work permit,  otherwise you are violating their law. Free movement of goods and services does not mean you reside in that country.

Nigerians do not know this. If you travel with your car to Benin Republic, your car is only allowed to stay there a month, failing to do that they have the right to impound that car, but the trucks are allowed to stay 72 hours because you are allowed to bring the goods to discharge and go.

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