Kano residents, businesses groan as state records low socio-economic activities

Abubakar Rimi Market, located in Sabon-Gari downtown area of Kano Metropolis populated mostly by the non-Hausa/Fulani residents of the ancient city, was one of the trading outposts established by the British colonial administration in the early 19^th century in the commercial city of Kano, northern Nigeria’s biggest business city. It has over the decades become a famous trading centre.

Rimi Market is now regarded as the biggest trading outpost in the West African sub-region, serving as a meeting point where goods imported from overseas, as well as those produced from factories in states along Nigeria’s coastal region, particularly Lagos, Ogun and Aba where manufacturing is still minimally active, find buyers.

Before now, Ali and most of other traders in the market usually opened their shops for daily transactions at 9 am to attend to customers that usually trooped in from across Nigeria and as far as the neighboring countries of Niger, Chad, Cameroun, Benin, among others.

But since the beginning of the year, Ali and many of his co-traders in the market have been forced to adjust their opening time to 11 am or 12 pm.

“Are you interested in buying something? I sell all brands and sizes of imported children’s wears, original ones, from China, India, even those made in Britain. Come and check, customer; I have them all,” Ali called out as I passed by his shop.

“I am coming, let me take a look around the market. There are other things I want to buy before I come for the children’s wears. If you could help me check, I need a pair black school shoes for a child under 7 years,” I responded.

About an hour later when I returned to Ali’s shop, he was fast asleep, just like most other traders in his section of the market. Some of them slept on their praying mats, but Ali slept on a wooden bench in front of his shop.

He suddenly got up on hearing approaching footsteps and welcomed me into his scanty shop.

“Why are you sleeping by this time of the day? You just opened for business less than an hour ago,” I said.

“My brother, this is how we have been sleeping for some time now in the market. There are no customers, buyers are no longer coming to buy things. You can see for yourself, how many people you can see in the market? You can count them on your fingers. This is what we have been going through since the beginning of the year,” Ali told me.

“If I tell you I have not sold goods worth N10,000 since the beginning of the month, you will not believe it. As we are talking now, this is almost the end of the month, and my shop rent is due by next month’s ending. What even make matters worse is that we no longer have dollars to import goods, that is why this shop is scanty like this,” Ali lamented.

As it is for the traders in Abubakar Rimi Market, so it is for other business owners across Kano, and indeed across Nigeria. The consequences of a mono-product economy are becoming to hit hard on most residents of Kano as earnings from crude oil continue to drop.

Also, the dysfunctional nature of the state’s economy, which has its productive base structured mostly on foreign ownership and importation of raw-material and machinery from overseas, is becoming evident as the diminishing dollar earning from sale of crude oil bites.

At the moment, experts say about 85 percent of Nigeria`s total foreign exchange earning comes from the sale of crude oil, and with the decline of the price of the commodity to less than $30 per barrel, the shock is being felt all over the country.

Manufacturing activities in Kano, which before now used to be one of Nigeria`s manufacturing hubs, have continued to experience downward movement in recent times. The glaring cumulative effect of this development on the state is the rising incidences of joblessness, particularly among the teeming able-bodied young people in the state, and the attendant growing cases of hopelessness, which experts have identified as a factor fuelling the insecurity in state and the region in general.

Kano State, commonly regarded as one of the most influential sub-national entities in the country, has for centuries played a pivotal role in the socio-economic and political development of northern Nigeria.

A total of 232 manufacturing companies have closed down in Kano between 1994 to date, a report compiled by Manufacturers Association of Nigeria (MAN) has revealed.

The affected companies are among a total of over 338 existing in Sharada/Challawa and Bompai Industrial Estate, the two estates where the bulk of manufacturing activity was concentrated in the city before now.

A breakdown of the affected manufacturing companies shows that 106 out the 155 industries closed down in Sharada/Challawa, while a total of 126 out of 183 industries folded up in Bompai within the period.

Detailed observation of the report shows that most of the affected industries are those in textile, food and beverages, motor vehicle assembly, chemical/pharmaceutical, pulp paper/paper product sectors.

Confirming the ongoing decline in manufacturing activities, Suleiman Umar Tofa, chairman, Bompai branch of MAN, said that the recent policy of the Central Bank of Nigeria to exclude some goods and services from the list of items valid for forex has forced many companies producing wheat flour in the state to shut down.

For instance, Northern Nigeria Flour Mills Plc recently shut down its wheat processing plant in the city as a result of growing difficulties the company was facing importing wheat, the core ingredient used for its operation. The company, like many others producing wheat flour in the country, depends on imported wheat from the United States and Europe.

Consequently, the company, which is the biggest and oldest flour manufacturing concern in Northern Nigeria, has off-loaded over 100 workers operating the plant into the already over-saturated Nigerian labour market.

According to Tofa, as it is, no company in Northern Nigeria produces wheat flour today as the flour being consumed in the region now comes from companies still managing to remain in operation in the Lagos-Ota manufacturing axis.

Before now, the hotel and tourism sector was a great contributor to the state’s Gross Domestic Product (GDP). Apart from the income it provides the state in form of tax paid by the players in the sector, tourists, especially business tourists, have helped to oil the engine of growth in the state. Hotels operating in the state, such as Prince Hotel, Grand Central Hotel, Tahir Guest Palace, and others have also contributed immensely to the state economy through job creation.

But with the drop in business momentum and general economic activities in the state in recent times, the hotel and tourism sector has also witnessed low patronage, to an extent that some hotels have been recording almost zero room occupancy rate.

Public debt crisis has emerged as the top trend that is impacting the economy of the state. The immediate past administration of Governor Rabiu Musa Kwankwaso in the state left a total public debt of over N300 billion, N207 billion higher than a total public debt of about N77 billion it inherited from the Governor Ibrahim Shekarau government in May 2011.

A breakdown of the state’s debt profile revealed that the state has an outstanding N105 billion to pay for jobs being executed on the over 2,715 ongoing projects across the state, and another outstanding debt of N33 billion incurred on projects inherited from previous administrations.

In the same vein, the state has a total of N117.8 billion to pay for uncompleted projects being executed in partnership with all the 44 local government councils in the state.

Also, there is an unpaid approved vouchers value of over N20 billion waiting for payment at the state Ministry of Finance, and outstanding pension arrears of over N10 billion.

The state also has an outstanding payment of over N789 million to be made to over 7,400 young people recently employed by the state government, whose names have not yet appeared on the state salary voucher.

The state’s huge public debt, as against its lean revenue base, is one of the factors for the low socio-economic activities being experienced by many residents of the state. This is already tasking the ingenuity of the Governor Abdullahi Umar Ganduje administration and forcing it to start thinking outside the box for possible solutions.