Can you assess the state of the manufacturing industry in Nigeria?

Manufacturing industry, not manufacturing by multinationals, not manufacturing by foreign groups but indigenous manufacturing. I understand and clearly too, that it is the indigenous manufacturers of any country that has the capacity to move the economy of that country up. Unfortunately for us in Nigeria, the total manufacturing contribution to our GDP is a mere four per cent. Whereas in some developed and fast developing countries in the world, you can get this contribution up to and more than 60 per cent. Even in Africa here, small countries like Ivory Coast has about 17 per cent contribution; South Africa has about 18.5 per cent contribution, in Nigeria, it is only four per cent contribution.

And unfortunately, from the angle we are coming, from this our area, especially the South East, the South East has the highest concentration of indigenous manufacturing activities in the whole country but then the neglect of this sector in this our area is something that caused a lot of pain to me. And sometimes I think it is deliberate that the manufacturing sector in this our area should be sidelined. And this deliberate attitude has led to this zone or this area having the highest level of criminal activities because manufacturing industry provides employment opportunities and their absence means lack of employment opportunities. And that is why our young people are roaming the streets. And that is why we are more like traders. This is because since we don't produce, our traders must have to try other places to collect these wares to market.

What is the situation in the South East geo-political zone?

The manufacturing sector of our area is suffering so much; the government has not done much to help us and the banks have not done much to help us. A recent publication in one of the national dailies opens the eyes of a lot of people, including me, where they gave us the statistics of bank loans portfolios in Nigeria. An earlier publication showed that South East alone produces about 16.8 per cent of all bank deposits and then as far as loan is concerned, we get two per cent of all bank lending , which is less than 12 per cent of what we give. South West and Lagos produce about 42.3 per cent and they get 73 per cent of all the cumulative loans given out by banks. So, we get a mere 12 per cent of what we give in the bank. This is a very big disincentive to manufacturing activities especially within this our area. South-South does not fare better, because it seems to be that the whole of the former Eastern region that is seriously neglected. That is why we have been shouting, we have been crying that we should get some attention. The government should pay heed to our cries because unless the manufacturing industry is properly attended to, we will not be in the position to provide the needed employment opportunities that would take care and checkmate the rising wave of criminal activities.

Not quiet long ago, we all witnessed the effect of kidnapping. It got so rampant that we were running away from this area: South-South, South East, that is the East, to other parts of the country; some were fleeing to other countries of the world. Industries relocated from this area; businessmen ran away. Kidnapping and other forms of criminal activities dominated the entire spectrum of this our zone. And when this continues to happen more people cannot come here to invest because for those of us that invested somehow we felt that we shouldn't have done it because manufacturing is not like buying and selling. In manufacturing, you have your building there, you have your machineries there, you have your workers there, you have your livelihood there, so you can't run, you are a sitting duck. But when this continues to happen over and over again, so many of our members closed their shops in Aba, in Owerri and Onitsha. It got to a point business almost came to a halt. We thank the government, the Federal and state governments, for the effort sthey have made to reduce the intensity of these criminal activities. But we pray that they should put a total halt to them so that people would have the mind to come and set up industries in this our area.

What other challenges do manufacturers face in the zone?

We also request that government should, as a matter of urgency, remove all the impediments that make it difficult, if not impossible, for us to compete because if you are handicapped, you cannot compete and if you cannot compete, you cannot grow. Our players are not competing well the way they should. We have a lot of good products in this country made by our people, the indigenous manufacturing sector of our economy but one of the major problems that we have is that the cost of producing them is very, very high and this makes it difficult if not impossible for them to compete with goods that are produced elsewhere. One former Chief Operating Officer of NEPA once told us that the South East, for example, is where they collect highest revenue for NEPA in comparison with other zones in the country but unfortunately, we receive the lowest supply of energy in the nation. When you look at all these things, when you see all these things happening , if you have the kind of factories we have here you will know that 85 per cent of the time we run on generators. And then your counterpart elsewhere maybe 85 per cent of the time they are running on national grid of NEPA. How do you compete? How do you compare? So, we know that we are short changed and we are not happy about it at all. And it is depressing our efforts, our members are crying, they are shouting for the government to listen.

During our immediate past AGM (Annual General Meeting) one of the complaints that came up repeatedly was attitude of the governor and the government of Anambra State towards industrial activities. Land and building constitute major factor of production. You can't produce in the air, you must have land, you must have building and most often industries rely on funds, external funding , especially from banks , Bank of Industry and commercial banks to fund their operations and the banks in turn will always demand one form of collateral or the other and the easiest and fastest collateral an industrialist can give is either land or building. And for the bank to accept it, it must be a registered land or a registered building, and that means, that the building or land must have a Certificate of Occupancy. The problem that we face is that for you to get the Certificate of Occupancy in Anambra State, it is the most difficult in the whole country: the most difficult, the most expensive. In our meeting, in fact, it took a lot of our time discussing it. Sometimes to get a C of O it can take you up to two years, because it is the governor who must sign it. And I think it is only in Anambra State that the governor still signs C of O. We have C of O from Ebonyi State.

We have C of O from Enugu State. We have C of O from Anambra State, only that of Anambra State was signed by the governor himself. For you to get an ordinary piece of paper, a Letter of Consent, to mortgage your own property, your own, it is not government property, the property is not in dispute, then apply to the government of Anambra State to get an ordinary letter of consent, two-sentence letter of consent, the governor of Anambra State must sign it. In other states, it even gets as far as a commissioner. And then for the government to give you this letter, you pay through your nose officially. For you to get a C of O in Anambra, it is the highest you pay in the whole country, because there is a lot of executive man hour inside it. Then the next stage is for you to get the mortgage paper stamped by the government in Anambra State, they collect one per cent of the value of the loan you are applying for. If a bank is going to give you a loan of N200million, then Anambra State government would collect one per cent of it from you and at the same time collect other small, small fees here and there. And it will still take you months for it to come out. I am not saying they said because I have experienced it and still experiencing it today. So, the government of Anambra State should review these things because it is a massive disincentive to industrialisation of that state. You cannot be saying you want to industrialise the state but at the same time all the factors that would make it easy and possible for people to come there to invest you are making it so difficult, so impossible for them to meet up with your demands. Anambra State government should, as a matter of urgency, review this land problem because they are killing. Before any bank would give you loan on a plot that is in Anambra State, they would warn you and they would even ask you please, if you have another property in Enugu or in Delta or in Imo, use it because this one will not come out.

Because the governor must scrutinise all of them with all his executive time that is so tight, his tight schedules, that is why these things don't come out; one year the papers have not come out. Then you apply for a loan today, then two years later, your papers would come out from the government. In Enugu, here, it is a girl that is treating these things in the Ministry of Lands. Just go there today, with everything together, you pay N5,000, they give you receipts and they say in two days' time, come and collect your papers. And it is the girl that would process these things and signed it; she is not even a Registrar in Lands Ministry but that is her table and she is doing it well. In Anambra , it is the governor, it is not fair, and you pay too much. And our members in Anambra State have find it difficult to secure bank loans, because the government would not release their papers that they need to act as collateral.

What is the way out?

We also pleaded with the governors of our area, as a matter of fact, all the governors to find ways to patronise locally-produced goods. Most countries of the world that are industrialised at one time or the other in their economic history introduced some form of protection for their nursery industries . These nursery industries are the indigenous manufacturing activities. They are always protected because they don't have the strength and the stamina of the big ones, well established ones. They don't have the strength and stamina of big companies that are producing and exporting to Nigeria for example, so they are protected. There is no more protection in Nigerian and even when the government says they prohibit certain goods; it is only on the paper that it exist because our borders are just open to receive anything. And when you are importing anything into Nigeria, if you import through Nigeria, you pay more. If you import through any of the West African country, you pay less. If you don't even have any importation document, just bring the thing across the border, and you pay next to nothing, because you only have to buy a few hands and take your goods. So, all these things are serious constraints in the manufacturing sector of Nigeria as a whole and of this particular area.

We are particularly short changed in this area and it is a burden. It is a very big problem. I want to see solutions to these problems. We want to see government patronising goods that are produced in Nigeria. We want to see government supporting Nigerian industries and in the real manner, and not just by words of mouth. The government may sometimes have some policies that keep fluctuating and changing like weather clock and it makes long time investment almost impossible because you don't know what would happen next year. People are afraid that when a new government comes in, what new policies would they introduce? What policies would they abolish? It becomes difficult to embark on a long term programme. So many forces are fighting against us, especially down here. If you load goods in a truck and want to deliver it in Port Harcourt, before you get to Oji River, you have accosted two or three revenue collectors. And then you enter Anambra, many of them are there waiting for you; and by the time you get to Port Harcourt, Port Harcourt is the worst of all of them, and they keep extorting money from you.

If you are bringing in finished goods, you don't suffer all these problems. I want you (the media) to pay a lot of attention to these issues; let nobody keep complaining that there are armed robbers, there are kidnappers and there are criminals around. Why are they there? Most of these people became criminals because they have no source of livelihood. And why don't they have source of livelihood, there are no jobs? Why are there no jobs? It is because government is somehow not properly supportive of the industrial sector, which has the capacity to generate needed jobs and as quickly as possible. You see the cycle. It is a cycle.

What advice do you have for the new administration of President Goodlick Jonathan to jump start the nation's manufacturing sector?

Well, in any country where you see goods being produced , most of them, vast majority of manufacturing activities are 24-hour operation, and you can only do 24-hour operation when there is 24 hours of energy. And without this energy thing in place, it is very difficult for the industrial process to actually take off. We are not industrialising, we are static. When you want to import machine, you bring machines, most of the machines we are bringing in, the highest you can go is semi-automatic; semi, because there is no light. Most times, it is manual intensive, because there is no light. But when you have 24 hours of light, or even if you have eight hours of light in a day, eight hours of uninterrupted light in a day, then you can produce for one single shift successfully for one day. It would enhance your productivity and that enhancement of productivity means more people being employed because the present crop of people cannot handle it. If you can bring in machines that automate your production, first of all your cost of production would come down and more people would e employed. So, the government as a matter of serious urgency, should take this power matter too seriously.

People have cried for it, it is not for nothing, we need it. We do 85 per cent of our production using generators; and now that gas is costing almost N180 per litre and generators that utilise one full drum, that is 200 litres every four hours, then if you do eight hours in a day that means 400 litres for one day multiplied by N180. It is impossible.Apart from that one, the government should look seriously into this issue of smuggling of goods. Our borders should be closed. If goods are coming in through the borders, they should come in at the same level as the goods that are coming in through our wharfs. If you pay 20 per cent maybe, for goods you are bringing in as raw materials, and someone else is bringing in finished products through any of our neighbouring countries and pays nothing, for finished products, you know what that means ; your cost is already up by 20 per cent. Other thing like multiplicity of taxes, they know, but I think the most important things should be energy and the control of our borders.