Obasi Uba Ekeagbara is the executive director, Akachi Industries Limited and current chairman, Imo/Abia branch of the Manufacturers Association of Nigeria (MAN). In this interview with GODFREY OFURUM, he tasked the Federal Government to support Geometric Power and Dangote Petroleum to solve the energy crisis in Nigeria, among other issues stifling manufacturing in Nigeria. Excerpts:
What is the current state of the real sector in Nigeria?
It is terrible. For some of us still in production, we are barely surviving. Apart from inadequate power, which has resulted in the closure of many factories, we are also faced with multiplicity of taxes from different government agencies.
Do you know the number of government agencies that visit our factories daily? All sorts of agencies that are not adding value to our existence. Rather, they are taken away resources that we would have used to pay salaries or invested to grow our businesses.
Apart from that, we are paying high tariff for imported raw materials that are not readily available in the country. Public power supply is still a major issue bordering us, as we spend so much on diesel to power our generating sets. High exchange rate also takes resources away from us Most people that have undelivered forwards are still waiting in the last four, five years. The laws are there to encourage investments, but it is not effective, the system is still over crowded with corruption. If government wants to support manufacturing it is easy and achievable. We thank God that Dangote Petroleum has just started production of diesel and petrol, but when you listen to the conversation between Dangote and the Nigerian National Petroleum Company Limited (NNPCL) you will start wondering whether they are still in the same country.
What will be the gain of the ordinary Nigerian, if factories shutdown? People are losing their jobs daily. The situation of manufacturing sector in Nigeria is terrible.
What do you think should be done to solve the energy crisis in Nigeria?
If the government is able to supply crude to Dangote in Naira, he will refine and sale in Naira. it’s a simple thing. It is not rocket science.
If they supply crude to Dangote in Naira, Dangote will refine and sale in Naira and all these things will come down. Transportation and goods will come down, because the price of petrol will come down.
You can’t compare price of petrol in United Kingdom or United States of America with Nigeria. The gross domestic product (GDP) of those two civilised climes is higher than what is obtainable in Nigeria. The income per capita in those countries and Nigeria are they the same? And then, what is the level of inflation in Nigeria? Is it the same?
So, it is just terrible. It is not as if nothing can be done. I believe something can be done, but government is not doing the right thing to support manufacturing. Sometimes, I pity my workers, because if we shutdown, they are the ones to suffer the more. We are just barely surviving to be frank. And I keep wondering, is it that the Federal Government wants to create a conducive environment or to suffocate us the more.
Just look at today, I received a letter from the Immigration Department, requesting me to provide these items in just one day. Today is September 18 and look at the long list of what they want me to bring tomorrow, September 19. The meeting is tomorrow. They don’t care whether I have scheduled engagements with other people tomorrow that will add value to what I am doing. You want me to leave Aba and move to Owerri with all these papers. Does it make any meaning? And if you don’t go, they’ll clampdown on you, as if you have something to hide.
Aba business operators rejoiced at the inauguration of power Limited, what impact will that plant have on manufacturing, if it is supplied with gas?
I pity my friend (Bert Nnaji), because it takes a lion’s heart to do what he is doing, to organise a consortium of investors and put up billions of Naira for a high-level investment and you are getting this kind of experience.
The same thing that I feel that is holding Dangote Petroleum is also holding Geometric Power, because they don’t have access to gas. Dangote is still pushing to have his way, which is the same thing Geometric is suffering.
Why can’t government grant these people access to gas and crude. There is something wrong somewhere. It looks as if our government does not care about the people. But I believe that we will have steady electricity in Aba, if Geometric is supplied with gas. Manufacturers are making efforts to meet with him officially, to share his challenges and see how his company can create a dedicated line from his plant to various facilities.
However, having met with his management team, there problem for now is how to access gas. It’s one thing to meet with Prof, and another thing is for us to get what we want. The problem is gas, it is terrible.
If the gas issue is solved and Aba gets steady power, how, in your opinion will it rob off on the manufacturing sector?
If I have raw materials I will produce. Gas is primarily their main raw material and the guy has a lot of burden in terms of loan repayment and you think that he will not produce and sale and pay back his loans? If he has gas, he’ll generate power, sale the thing and pay back his loan, which is what his interest is.
But he is being frustrated, it’s just terrible. Like I said, the same thing Dangote is going through is what Geometric is facing as well. Unfortunately, the two investments have to do with power.
You are chairman of MAN, Imo/Abia chapter, how many manufacturing firms have shut down due to power problem and other policies of Government?
Unfortunately, we are losing our members on monthly basis. Many of them have closed shop, especially those that could not cope with the high cost of providing alternative source of power, raw materials and the demands of government agencies. To us it is double taxation. Ordinarily, having paid your tax, you should be free.
As employers of labour, we had expected that Government should give us tax holiday and warn some of these irrelevant agencies to stop visiting our factories and creating problems for us. They are always at our gates with one sort of demand or the other. Some of them bring bills of ₦1million and above. With such monies can’t you use it to pay salary or even increase supplies? It is tough and even if you go to commercial banks for loan, the interest rate is high at 30 percent and above. So, if you take such a loan, how will you pay back?
Although the Tinubu administration. has granted manufacturers ₦70 billion loan facility, which is highly commendable. However, the process of accessing the money is a herculean task. It has been announced, but how many of our member have the capacity to access the money. If you approach the Bank of Industry (BoI), they will give you a long list of requirements and to bring any of those things cost money. I would have preferred that since the government has provided a loan package, they would have made it easy for us to access.
The way it is now, the BoI expects us to get a loan guarantee from our local banks and when you approach these banks, they’ll give you conditions and that is why I said that some of our members cannot access the loan.
So, since the Federal Government has approved this package, it should have expended the package as special and come up with easier conditions so that our members can access the fund and employ more people and leave their factories open. That is what I’m pleading. My request can be against banking ethics, but that’s what I’m pleading.
If you want to do good, do good. If you don’t want to do, don’t do. Don’t come and show us money that we cannot access. To me, that is a waste of time.
What is MANs relationship with Imo/Abia State Governments?
We have cordial relationship with the states, but we still need some more. Some of our states have laws on transportation, which inhibits trucks from coming into the states at certain hours. So, that is affecting us negatively, especially those conveying essential goods. Trucks wait on the highway till evening to come into our factories, which wastes time. We also pay demurrage on the delay. We are pleading with the governments to create some special waver for trucks conveying raw materials to factories.
