Insecurity concentrating foreign investments in Lagos – Al-Mujtaba

Dr Abubakar Al-Mujtaba is the President of the Abuja Chamber of Commerce and Industry (ACCI). In this interview, he says the level of insecurity has made it difficult to attract foreign investors into the country with the few investments available going to Lagos State and the South West region due to relative peace in those […]

Dr Abubakar Al-Mujtaba is the President of the Abuja Chamber of Commerce and Industry (ACCI). In this interview, he says the level of insecurity has made it difficult to attract foreign investors into the country with the few investments available going to Lagos State and the South West region due to relative peace in those areas. He also argues that the continued payment of fuel subsidy would make Nigerians to perpetually live in a fool’s paradise as the money needed for infrastructure is going into consumption, which won’t aid growth of the economy.

The Manufacturers Association of Nigeria (MAN) recently visited the Presidency and highlighted issues bordering the sector, including the lack of enforcement of the purchase of made-in-Nigeria goods. What is your take on that?

When former President Obasanjo came into office the first time, he gave an order that all government cars must be made in Nigeria and it was complied with. Peugeot 405 took over the streets and all Mercedes-Benz cars used before then were sold. But immediately he left, the civilians jettisoned this order and went back to Mercedes.

Today, every senator and governor is riding a Toyota Jeep. They have forgotten about the made in Nigeria goods. The point I am making is that it is possible for us to go back to this. It has been done before and we saw the effect.

When the president recently inaugurated the rice pyramid, the head of the rice farmers told us that the shutting of the border to prevent the importation of rice led to the creation of jobs for millions of farmers as well as the potential of achieving self-sufficiency in the commodity with the support of the CBN.

We can replicate this policy in so many fields. What killed the textile industry was cheap clothing that flooded the market. If we can close our borders to promote certain products with the kind of support given to the rice farmers, we will be able to achieve a lot. It has been done before and can be done again.

With the growing spate of insecurity, can we achieve sustainable economic growth in Nigeria?

Security is the number one factor for a vibrant economy. Nothing works without security.

I have been a farmer for the past 40 years and I usually visit my farm almost every week along the Abuja/Kaduna Road, but today I can’t drive myself to the farm even at noon.

I have visited the farm only once in the last three months. These days, I only speak with my farm managers through the phone. This is what insecurity does, it limits the operations and performances of those who will drive the economy.

So, security touches on all the questions we talked about and nothing will work without it. The kind of information that is filtering regarding insecurity in Nigeria is also affecting the economy because people are afraid to come and when they do, it has to be localised.

For instance, a lot of businessmen that come to Nigeria to open new businesses do that in Lagos because there is relative peace there. They won’t go to Kano or Maiduguri. But if there was peace, they will go anywhere.

So, security is very important for robust business activity and we need to do much more than what we are doing.

We need to go back to the fundamentals to bring back peace. They say all these kidnappings and so on are banditry, but to me, it is a revolution. Banditry is a localised thing like we see in the US, where someone will kill a few people and when the victim is caught, everyone will be safe again and go back to their activities. But when you wake up with killings every day, it is no longer banditry. Banditry is a local thing but revolution is widespread. Unfortunately, the people who are doing it are illiterate and that is why we are looking at it as banditry.

Frankly, I think the way we should look at it is that of a revolution pointing to the fact that something is not right and the people are protesting but they are doing it in a way that is harmful. That does not mean I am supporting banditry.

If I were the president, what I would do is set up a high-powered committee to look at its genesis and give recommendations. We should not certainly joke with those killing people but go down to the point of solutions to it.

What areas of our economic structure are you worried about?

When the state governments present their budget, more money goes into the running of government than what goes to investment. It is the same thing with the federal government. It is not even 50/50. Governance is always higher than what goes into investment. But in any country that wants to develop quickly, it should be the other way round. The cost of governance should be maintained in a very minimal way. The worst situation you can think of is 30/70. 30 per cent for the government recurrent expenditure and 70 for investment.

For me, I also believe that fuel subsidies should be removed.  People have built their lives on it. If people feel that when there is a subsidy, the cost of living is low, thus, with the salary they get, they can afford to marry two wives and instead of keeping three children, they opt for 10, which means they have built their life around it.

Supposing there was no subsidy, they will not make such a move because the economy does not support it. So, that is the effect of subsidy. It is making us live in a fool’s paradise and creating more problems than it is solving.

In the short term, people will say the cost of living will rise but in the long term, we are diverting money that can be used for development rather than consumption. Can you develop by consuming? You can’t. You have to put more money into production, which is the only way you can develop.

The chamber engages in trade facilitation which leads to foreign direct investment. What are you doing to document these efforts of yours?

Yes, we have not been documenting this aspect but our chamber is still very young as we have not started getting enough money until when the former president did all the structures that are on the ground that are now generating rent and more activities for us.

There are some infrastructures needed to generate the kind of statistics that will help us with that. Our operations are rudimentary but we will get there since we are now generating sustainable revenue with the four centres we have.

When we started the fair at Area 10, 16 years ago, it was only market women that came but as of last year, we had an audience of foreigners and local manufacturers that came out to display their made-in-Nigerian goods.

Our chamber five years ago did not have all the buildings there. The buildings are now making a huge impact on us. Now, ambassadors want to visit us because we have an image.

When you talk about the Abuja chamber, people will picture a building and an expanse of land. Part of our strategy is to have more infrastructure for the fair. We have a big expanse of land and want to develop part of it to attract more indoor trade fairs. That means we can do more of the fairs in a year which can be sector-specific.

At the rice pyramid launch, Alhaji Aliko Dangote commended us for the work we are doing, to which I replied to him that it was due to the support we are getting from businesses like his group. The philosophy is that if the economy improves and the chamber does the same, there will be synergy with private companies.

The bottom line is that we have made progress and when people speak about chamber movement, the Abuja and Lagos chambers are mentioned. However, we have an edge over the Lagos chamber because Abuja is viewed as a national chamber while Lagos is seen as the state’s own.

The management of the chamber has recognised it and we want to realise it. But I have to thank my predecessors for doing very well. I have served the chamber for 20 years and I know what I met as it was hard to pay salaries then. But today, I don’t think about salary again but money to bring new ideas into the chamber.

Are there moves to engage those in government to understand the importance of the structure of the chamber in terms of influencing policies and foreign trade facilitation as obtained in other climes?

I have sensitised my colleagues on that and I told them that we have to start somewhere.

I advised that we have to identify those we should talk from federal lawmakers to some ministers and together we can work out something.

Also, we have to carry the other chambers along. We have started it, which we believe will be beneficial for the chamber movement and the country, but it is a thing that may take a long time to achieve. We want to start with a step and move in leaps as time goes on.

I told them that they should not think we will finish it during my time but that it should be a continuous effort. We will also carry NACCIMA and MAN along to see how we can actualise the movement.