How to develop North’s economy – Mohammed Hayatu-Deen

Malam Mohammed Hayatu-Deen, a former Group Managing Director (GMD) of Northern Nigerian Development Company (NNDC) and former Chief Executive Officer (CEO) of FSB International Bank, is well known in the corporate world having played key roles in the Nigerian Stock Exchange and the Nigerian Economic Summit Group. Appearing on Trust TV Programme 30 Minutes with […]

Malam Mohammed Hayatu-Deen, a former Group Managing Director (GMD) of Northern Nigerian Development Company (NNDC) and former Chief Executive Officer (CEO) of FSB International Bank, is well known in the corporate world having played key roles in the Nigerian Stock Exchange and the Nigerian Economic Summit Group. Appearing on Trust TV Programme 30 Minutes with Mannir Dan-Ali, he speaks on how to develop the economy of the North among other issues.

 

Recently, you delivered a keynote address at a big conference on Northern Nigeria, where you set out what you termed a path to Northern Nigeria’s future. You spoke about agriculture, mining, and power. Why did you isolate these areas as the drivers of Northern Nigeria’s future?

My heart and soul have always been in the Northern part of the country. I was born and bred here. I went to school here, and then worked for the Northern Nigeria Development Company, which has, since colonial times, been a major locomotive for bringing about the economic development of the North. It was founded in 1949.

Secondly, the Northern Elders Forum (NEF), which actually hosted the Northern Nigeria Investment Summit, has historically been a politically oriented institution focusing on good governance and leadership. They have always been clamouring for new leadership in the North in some of their fora. This, I think, is the first time ever they decided to pivot towards the economy.

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Is that the reason why you are excited about it?

I was very motivated. I was abroad when they called me to deliver the keynote address on the topic “Harnessing Technology to Bring about the Industrial Development of Northern Nigeria.” So, from that perspective, I was very pleased because it’s a subject matter dear to my heart. Everything that we do in every sphere of life always ends up at the breakfast table and the economy is central to producing goods and services for any economy. So, that’s how I got involved.

 

But is it your view that, as GMD of NNDC, you didn’t exactly succeed, which is why we’re still talking about how to get Northern Nigeria up and running economically?

Well, Nigeria has metamorphosed through many regimes. The Northern Nigeria Development Company itself was a brainchild of the government of Northern Nigeria, and the 14 states later created. Then, it grew to 19 states that inherited the asset in various proportions. When I took over from great people like Alhaji Musa Bello and Alhaji Hamza Zayad, the institution had already been built into a major force — not only in Nigeria but south of the Sahara. It was the single largest diversified holding company.

 

I understand it had 140 companies under its belt…

It was 145 at the time, up to when I left. What we did was: one, promote investments; two, promote entrepreneurship; and three, take development to all parts of Northern Nigeria. But in doing so, we made sure we were able to invest in entities that made commercial sense and were sustainable from a profitability point of view.

Even though we were a public institution, we operated on private-sector principles and covered all segments of the economy.

 

But why are many of those companies now moribund? Has NNDC divested from them?

Time changes everything. Nigeria itself, if you look at its history and trajectory, would have been in the league of great nations like Singapore, Malaysia, South Korea etc. We all started together. NNDC is a microcosm of the larger polity. So, anything that affects Nigeria affects us.

Certainly, there was such a high turnover of government and the quality of governance has declined over the decades. The economy has been in doldrums, and appointments to important positions like NNDC increasingly, after my time, were less based on merit and more on political considerations.

 

So, is it more like a job for the boys?

I wouldn’t say so. I wouldn’t want that kind of language. But it’s fair to say the quality of thought at the political and technocratic level in terms of what NNDC was and what NNDC should be had declined substantially.

And with bickering among states and the multiplicity of 19 states, it became difficult to reach consensus on any issue.

This is not the case with the military government where there is supervision of what governors (military administrators) are doing. Under the military, you had a unitary form of government and central supervision from General Headquarters. So, it was easier to harmonise thoughts because they always went to general headquarters for clearance of actions. It is more difficult under a civilian government. The governors we have had since 1999 had enormous powers. The constitution gives them so much room for navigation and independence that they could do — for want of a better phrase — whatever they wanted to do.

 

They’re like little emperors in their states…

I wouldn’t say that. But the legislators were weak. They have control over legislators and lower courts in their various states. It also takes knowledge of history, to be part of that history, and to be enlightened to actually know what you want to do. 

 

Then, how do you imagine, with this mindset, that governors will listen to your prescriptions on moving Northern Nigeria forward?

Essentially, what I provided was more or less a small blueprint. It has more to do with catching up. So, much time has been lost. My paper provides a pathway to catch up as quickly as possible by focusing on key areas: mining, agriculture, and power. I would also include manufacturing, which is an integral part of it.

 

In your address, you also said people shouldn’t think of big companies but smaller ones that fit into Nigeria or the African free-trade corridor. What do you want to say here?

Maybe that was not exactly what I said. What I said is that the world has gone through a sea of change. The old model of development based on the first and second industrial revolutions has given way to a new wave — where you don’t need very big factories, machines or capital assets that consume a lot of money to create a distinct competitive advantage even for a locality, community, state or a country. Therefore, if you are far behind in Nigeria as we have been, probably since 1999, we now need to catch up rapidly by identifying specific areas that consume far less capital, are futuristic in nature, and can create new markets both locally and abroad. The singular thing you require throughout is technology — it changes everything: the internet, artificial intelligence, blockchains, and all of that. You can actually break through the barriers and quickly get on the map.   

 

But how do you do that when a large chunk of young people are out of school not to talk of getting exposed to science education?

That’s a relevant question. You can actually dissect that demographic. For those without education, you need a separate track to get them educated — we’re looking at over 16 million, probably 20 million now, and rising every day. So, you must put them through a different track. Yet, there are many people in Northern Nigeria with certificates from polytechnics and universities.

 

Are you possibly talking about those with the wrong kind of skills?

No, they have the right kind of skills but they cannot find jobs. So, in the short term, attention should be on those young, energetic, motivated people who can’t find work. My paper suggests the creation of a Sovereign Wealth Fund for Northern Nigeria — from the proceeds of minerals, agriculture, and power — dedicated to training about three million people in agritech, blockchain, data, etc., for a period of three years. That will require northern governments to collaborate to achieve that. It’s actually doable.

 

Are they listening?

I wouldn’t know whether they are listening or not. But I know that after my paper, the Bauchi State Governor convened a group of northern governors to discuss investments in Northern Nigeria. They even called for my paper in order to use it as a platform to develop further proposals. But what I can tell you which is extremely important is that when NNDC was thriving up to my time, its counterparts — Eastern Nigeria Development Corporation was already dead and Oodua Investment Company was struggling badly. But under Kayode Fayemi and others, the South-West governors revived Oodua through the Development Agenda for Western Nigeria (DAWN Commission). They came together to craft a regional blueprint to develop their region and built collaboration across trade, investment, infrastructure and financial institutions. One of their cardinal objectives was to reinvent the Oodua Investment Company. Two of their GMDs were my staff in FSB. The current GMD was actually my Financial Comptroller. They’re very good and they are getting there. There is something they did. Instead of having ownership, they decided to hands off.  All board members are from the private sector; no government secretaries or heads of service. They operate on private-sector principles.

 

What really helped the South West to revive their regional economic powerhouse?  

Certain things help them: same language, small number of states compared to 19 states in the North, and their differences are minimal. Because of their religious and cultural history, it doesn’t matter whether you’re Muslim or Christian. In the same house, they have those who are Muslims and Christians. They live together and speak the same language. More importantly, the people running those states are sharp and exposed. It doesn’t mean that our governors are not good. But they’re ambitious and driven.

 

They seem to have the advantage of a part of Nigeria like Lagos and Ogun that have enjoyed huge resources. Is that not a plus?

Yes, it is a plus. But it won’t be a plus for so long. After sometime, such advantages disappear unless you keep expanding the frontiers of progress. I think one has to give them a lot of credit in terms of their gut and determination to get things done.

 

Some Northerners get uncomfortable when Lagos creates a leather hub or a big rice project. Ogun is also going into dairy. These are sectors the North once dominated. What is your take on that?

Nature abhors a vacuum. If you have a competitive advantage in a certain sector of the economy over a certain period of time and you experience a great decline, others will fill that space. The population is growing every day. Someone has to fill that space. I don’t blame them at all. Every time we point a finger at someone, four fingers are pointed back at us. It’s a wake-up call for Northern Nigeria to do what’s right. It’s never too late for a comeback — it only requires will and determination. Don’t forget that one other thing is insecurity.

 

How do we do this amidst insecurity, especially in your home state, Borno, where we faced Boko Haram and banditry in the North West in addition to the threat posed by population explosion as you earlier observed?

I think it is good to put matters into perspective. For about 25 to 30 years, certain parts of Northern Nigeria have been deprived of economic opportunities. At the same time, the population is growing, schools are collapsing, jobs are scarce, youths are idle — and an idle mind is the devil’s workshop. We have gotten to a new age of social media, where the whole world is on the palm of a hand. There is mischief that is easy to ‘copy and paste’. People can easily learn to make these improvised explosives. If I’m hungry, I can’t get one meal a day, I can’t see N500 in a month, I’m a youth, I have a bundle of energy, the social values in which he was brought up is not as pristine as you and I went through, you push the young man to the wall. He then goes on an expedition. Very quickly, lightning will strike. The income he cannot make in 10 years, in one lightning strike, he can get N10, N20, N30 million by just abducting or kidnapping people in communities. That is a negative vicious cycle, worsened by drugs and addiction. Even life itself becomes a canon folder.

It’s like Northern Nigeria is sitting on a keg of gunpowder. It really needs to reinvent itself economically so that jobs can be created for people.

This is about leadership. The federal government has its role to play, but under our constitution, we have a federal structure of government. Under this federal structure, there are certain duties, rights and obligations that are legally assigned to various tiers of government.

A lot of local empowerment initiatives are actually under the domain of local governments, especially state governments. If people decide to sleep, these are the downsides you get — and it’s gone on for too long. The media and the nation focus too much on the federal government, which is transparent and easy to scrutinise, but very little on the states.

 

So, do you mean the media is complicit?

Not complicit; but there is a need to focus more on states and hold them accountable. The powers state governments enjoy under our democracy, there is no president that actually enjoys that. They have legislatures, judiciary, and treasury under their control. For the treasury, there is very little accountability. The federal system has been designed and tested over a long period of time. So, it has endured. I wouldn’t say there are no leakages in the federal sector. There are leakages. But when compared to the states, the federal government looks like angels. Systems are better established and they have more competent technocrats at federal level.

 

To come back to your idea of getting out of this cul-de-sac economically, where do you mobilise the capital? Is it just allocations from Abuja, or resources in the states? Where do you get the financing as a financial expert?

As a community across Northern Nigeria, we all have roles beyond government. We should direct our energies to ensure we are able to do things ourselves, of course, with the government’s help. But we should never exclusively depend on the government to do things for us when it is the last critical sector of power to mobilise politicians, private sector and civil society to get harmonised. Once we’re organised and resourced, we can pressure the government to behave responsibly and join us in doing this. Sources of funding include blended finance — equity and loans. You would be amazed to know that the number of entrepreneurs in the North has grown in leaps and bounds. Whereas somebody, like Gambo Doro and myself, had grown up under a shadowy government. These days, these young people, right from the age of 40, 41, 42, they don’t even know how to source from the government. They just grow up and know how to help themselves.

 

Is that good?

It is a very good thing because that is what happens around the world. There is too much focus on the government in this country. Government is an enabler. It is supposed to provide safety, security, health, and infrastructure in order for you to use your God given talents to strive and get out of the way.

 

So, leapfrogging in the North will not only be driven by the government but entrepreneurs and people with business ideas and acumen?

I see that coming from a number of tink tanks from the North to organise those bodies that will make this possible in collaboration with universities and polytechnics which should provide much of the resource that is required. You bring entrepreneurs on board as the government creates incentives and a climate conducive for investment. We can also tap climate finance and the Northern diaspora, who are many in Europe, America, and Asia. We can bring these people to come and invest. They can invest and fund projects. There’s development finance that can be tapped from the African Development Bank (AfDB), AfreximBank, and the Nigeria Sovereign Investment Authority. There’s no shortage of funding institutions. I will go further to say that NNDC has played its role in the past. In my paper, I suggested that what we need is to create two new development banks, two new national commercial banks that are Northern in conception and origin, and four banks that have a regional licence with a lower threshold in terms of equity required, and a number of community banks and fintex to finance the operations as we go along.