Why Nigeria can’t grow its economy —Kano Chamber of Commerce

What are the major restrictions to the growth and development of the Nigerian economy? As you know, the Nigerian economy is in a very sorry state; the major ingredients that allow for growth and development are grossly inadequate. Electricity which is the major tool for industrial development and trade is inadequate or in some cases […]

What are the major restrictions to the growth and development of the Nigerian economy?

As you know, the Nigerian economy is in a very sorry state; the major ingredients that allow for growth and development are grossly inadequate. Electricity which is the major tool for industrial development and trade is inadequate or in some cases lacking. Electricity is used to power a lot of things. Without it, even the IT infrastructure cannot work and perishable goods cannot be preserved. Alternative sources of power which most companies and individuals run goes at a very high cost.

The roads are in a deplorable condition. Goods cannot easily be transported and the railways which is commonly known for the movement of heavy goods from one place to the other, has been completely abandoned. The last extension of railways we had in this country was as far back as 1968. The eight-year administration of Olusegun Obasanjo paid so much lip service to the development of the railway system but ended achieving nothing.

The banks are not useful in economic development; interest rates are in two digits. Most often, economic policies have been changed without taking a holistic view of the economy.

There is growing lack of capacity among our entrepreneurs. We have not had a situation where our businessmen are able to key into the global economy and exploit the benefits that abound there.

Appointment of individuals into organizations that are meant to support the development of commerce and industry is usually lopsided. Most often, the persons appointed lack the knowledge and background to run the organizations professionally. I can go on and on because the problems are numerous.

What are the best ways of tackling these myriad of problems especially in the energy sector?

First, government needs to prioritize its objectives. When the late President Umaru Musa Yar’adua prioritized and came up with the seven-point agenda, we applauded it and we were all happy that electricity was number one on the list.

We still believe that the best way to tackle the problem is to introduce a state-of-emergency in the power sector. President Obasanjo, during his time, invested a colossal amount of money in the energy sector. As you know, it became a subject of investigation by the House of Representatives.

So, the best way to deliver Nigeria from darkness is for President Goodluck Jonathan to put everything he has to ensure that there is sufficient electricity supply to meet the requirements of our industrial development and commerce. I added commerce because after producing, you also need to distribute  and that bit also requires electricity.

How did the 2010 budget affect the activities of your chamber?

It was an adjustment budget and we expected some pains last year and we also expected some pains this year. But by 2012, I expect that the activities of the chambers will be strengthened as we are hopeful of the benefits of the controls we have been subjected to last year. Inflow from us was about N1.3 trillion from last year.

What is the status of the intervention fund provided by the federal government?

Over N100 billion was dedicated to the sector and the CBN even went round our zones to educate our members on how to access the funds but like similar facilities before it, we have found it difficult to access the facilities due to the stringent terms and conditions.

In fact, at a point, we even thought that the facility was not really available. Even at that, if you are able to get the funds, you still have to generate your own electricity, no good roads for the movement of goods and the exorbitant rates of the counterpart funding with commercial banks made it extremely impossible to break even with the facility.

The issue of collateral also comes up making it further difficult to access the facility. We insist that the capacity and structure of the organization seeking the loan is paramount. As long as you have the structure and capacity to carry on with your business and have achieved the requirements of the laws, I believe that the loan should be granted with or without collateral.

With the coming of the proposed interest free banking, would you say the problem will be taken care of?

I laugh when people express doubt over the viability of interest-free banking in Nigeria. I want to let critics know that interest free-banking  is a system that is practised all over the world including America.

It is a banking system that will add a lot of value to the Nigerian economy once it comes on stream. It will resuscitate many dying businesses. We look forward to seeing it established because it will go a long way in Nigeria’s economic development.

How best can corruption be tackled?

As far as I am concerned, corrupt persons should be treated as saboteurs. The punishment for corrupt public officials and private sector operatives should be from life imprisonment to death by hanging.

We should begin to adopt the rules of the Chinese because corrupt persons are like AIDS. They destroy the fabrics of the society, they should not be spared. If death by hanging is too stringent, then I also suggest that they should be given life imprisonment with hard labour.

What of celebrated cases where the EFCC and ICPC drag their feet on the prosecution of corrupt persons?

This is where the role of the media comes in. The corrupt officials are still alive, the media should go ahead and reopen their cases through the public domain even if it means going to court.

It shouldn’t be assumed that the anti graft agencies know it all and can do it all. It is incumbent on Nigerians to bring up these cases. Those who have been abandoned and those that are yet to be brought up for prosecution.

What is your reaction to cries by most traders in Kano that the Chinese have invaded the market?

We welcome businesses from all over the world, Germany, China and so on. The cry of foul by traders in Kano is not well informed. The people who come to Kano to do businesses are here because they see opportunities and they are opening our eyes to certain things.

We know that today, we can’t do much because we don’t have electricity and other logistics. As soon as government takes care of these major issues, there will be some better competition.

If I produce a bale of African prints at the cost of N90,000 and cloth of same material comes in from China at over N100,000, I am not going to have any problems.

But today, if you are producing at the cost of N90,000, the one from China comes in and is sold at N30,000, so it doesn’t really matter whether the Chinese bring in the goods themselves because their goods will certainly end up being smuggled into the Nigerian market due to the high cost of production of Nigerian products.