The Nation Newspaper

Category: Issues

  • Why campaign for cement standardisation persists

    Why campaign for cement standardisation persists

    The campaign to standardise the manufacturing and importation of cement is gathering momentum, as experts and stakeholders in the building and construction industry renew the call for the authorities to make the higher 42.5 grade of cement the standard product in Nigeria. Assistant Editor Chikodi Okereocha reports that the latest agitation is prompted by the recent collapse of a two-storey building in Lagos.

    If an opinion poll is conducted, it is doubtful if any issue would beat the rising spate of building collapse in Nigeria among issues agitating the minds of operators and stakeholders in the building and construction sub-sector. Between 2007 and last year, over 130 buildings collapsed in Lagos State alone, according  to a report by a tribunal of inquiry set up by Governor Babatunde Fashola on May 20, last year. The problem is not peculiar to Lagos. Major cities across the country such as Abuja, Port Harcourt, Enugu and Warri, have had a fair share of building collapse, and in most of the cases, experts identified poor quality and lower strength cement as one of the causes.

    Indeed, rising cases of building collapse has been a pain in the neck of estate surveyors and valuers, architects, town planners, quantity surveyors, engineers (structural and civil), building contractors, landlords/developers, and the regulatory authorities. It could not have been otherwise. The emotional trauma, which occupants go through when such buildings collapse, is unimaginable. Apart from losing properties and loved ones, families have been displaced, with some yet to find alternative abodes.

    For instance, two weeks after 10 persons, including teenagers sustained varying degrees of injuries when a  two-storey building collapsed in Lagos, they are yet to get over the shock. The victims were reportedly working in the building at 11 San Beach Lane, off Longe Street, Oworonshoki, when it caved in about 11am. The owner of the collapsed building and the contractor in charge took to their heels to evade arrest by the authorities.

    It took the combined efforts of safety agencies to rescue the affected persons who were trapped in the rubbles. The Nation reported earlier that the rescued teenagers – Monday Ahungbe (12), Jimoh Adebiyi (13), Oba Alafia (14) and Moses Atokiti (15) were assisting six adult construction workers. They sustained minor injuries and were taken to Folabi Medical Centre, Oworonshoki. Two of the adult victims with major injuries were taken to the Gbagada General Hospital.

    The incident, the latest in the long list of building collapse in Lagos, as usual, drew the ire of not a few Nigerians and stakeholders, most of who are renewing their agitation for stricter enforcement and complete overhaul of the building and construction regulations. Specifically, they are insisting that relevant authorities should initiate moves to adopt the higher 42.5 grade of cement as the standard product in Nigeria as against the lower grade 32.5 in the market.

    Leading the renewed campaign for standardisation is a coalition of civil society groups and professional bodies in the construction industry. The coalition is threatening to lead protests against manufacturers and importers of 32.5 grade cement. It threatened to take its campaign to the National Assembly where it hopes to demand that lawmakers probe manufacturers and importers of cement, some of who the group alleged, compromise standards.

    About three months ago, the coalition kick-started the campaign to enforce standard in cement when it petitioned the Federal Government and threatened to lead a march against cement manufacturers over their possible complicity in the collapse of buildings that had become rampant in the country. The coalition identified poor quality and lower strength cement as one of the causes of failed structures and insisted that the government must force manufacturers to produce and distribute only the highest quality of the product to stem building collapse.

    In the petition, the coalition noted that nearly all the cement manufacturers and importers in the country were taking advantage of the lax regulation and lack of enforcement to vary their pigmentation in favour of the lower grade cement (32.5), which in most cases, is used in building works, and believed to be partly responsible for building collapse. The group therefore, called on the Consumer Protection Council (CPC) and Standards Organisation of Nigeria (SON) to ensure that strict standards are maintained and offenders punished.

    The coalition did not stop there. They also made a case for urgent enforcement of the National Building Code, arguing that this could go a long way in addressing the lax control by regulatory authorities. The civil society groups also disclosed that they were reaching out to the Council of Registered Engineers of Nigeria (COREN) to lend its voice to the unwholesome practice of cement manufacturers which, according of them, is endangering the lives of Nigerians. They vowed to confront the Cement Manufacturers Association of Nigeria (CMAN) for poor standard of locally produced and imported cement, claiming in their working document that most advanced countries are migrating from the lower 32.5 grade of cement to the higher level 42.5 specification and even 52.5 with a uniform standard set by the government, manufacturers and importers.

    Ninety-two per cent of Portland cement produced in the United States (U.S) are in 52.5 and 42.5 grades, while other imported cement from China, Japan, Denmark and Paris are all 42.5 Grade.

    “Over 90 per cent of consumers are not aware of the different types of cement available in Nigeria. Their expectations  on the performance of cement are the same regardless of the type. The grade (quality) of concrete to be used may allow 32. 5 grade cement for certain construction work such as pavements, rendering (plastering) and culverts, but would demand 42.5 grade of cement for structures, columns, bridges and multi storey buildings,” an expert said.

    The experts who declined to be mentioned, explained that there are about three types of cement in the Nigerian market, namely, CEM 1 42.5 R, CEM 1 42.5 N, and CEM 32.5 R. However, there are variants of these types of cement with different specifications. CEM I 42.5 R and CEM I 42.5 N cements are produced with clinker and limestone in the ration of 95 per cent and five per cent, respectively. The gypsum that is added during the grounding is for adjustment of the setting period, which is usually obtained at the end of 28 days.

    Among other applications, this cement is used when good strength concrete is required,especially in concrete productions requiring high strength, or early strength. Also, it is used in the production of thin section reinforced concrete and in highly reinforced concrete buildings, among other uses. CEM II 32.5 is suitable for flooring and wall plastering (rendering).

    “Prior to Nigeria’s attainment of self-sufficiency in cement production, how come that during the import era, we were all compelled by the regulatory authorities to bring in 42.5 grades and now since 2012 when import was banned, the same regulatory authorities condoned the production of 32.5 grades?” the Group Managing Director (GMD) of Dangote Cement Plc, Devakumar Edwin, asked.

    The President, Association of Town Planning Consultants of Nigeria, Moses Ogunleye, proffers an answer. “SON seems to be overwhelmed; they are monitoring standard in several sectors and so, they may not be aware of the existence of poor quality cement in the market,” he said, adding, “let us ask questions from SON.”

    Ogunleye argued that there is no reason why anything sub-standard should be in the Nigerian market in the first instance, much less cement. He also said the Lagos State Material Testing Laboratory set up to register and accredit all block moulders as part of the standardisation drive has not yet registered anybody.

    However, SON has risen in stout defense of its regulatory role in the cement sector. First, the organisation insists that the quality of cement is not responsible for the spate of building collapse in the country.

    According to the Director-General of SON, Dr. Joseph Odumodu, the quality of cement produced in the country is up to international standards. He noted that unethical practices among builders are the major reasons for the incidence of collapsed building. Hear him: “The quality of cement is not responsible for buildings collapse. Our findings show that this often comes from concrete mixing. A bag of cement is meant to produce 30 blocks, but some people often use it to mould 50 blocks.”

    Secondly, Dr Odumodu insists that as a responsible organisation, SON is committed to ensuring that the consumers get the best of quality whether in the construction industry or elsewhere, which was why he said the organisation constituted a technical committee of experts to generally review the problems faced by stakeholders in the construction industry especially in terms of quality of building materials including cement. “The committee, which is made up of well-informed individuals would take a holistic look on the quality of building materials in the country inclusive of cement. As a responsible standards bureau, SON has never and will never leave the quality of any product to the whims and caprices of any individual or group of operators”, he said.

    Dr. Odumodu explained that the inauguration of the technical committee became necessary because of the technicalities of the issues in contention, which needed to be addressed by experts and stakeholders from various segments of the construction industry and the society.

    Members of the committee are technical people from professional bodies, the academia, civil society organisations, trade unions, cement manufacturing firms and journalists, among others. The National Association of Block Moulders, Raw Materials Research and Development Council (RMRDC), the Nigeria Building and Road Research Institute (NBRRI) and the Nigeria Society of Engineers (NSE), among others, are all members of the technical committee.

    The committee met on March 17 and began the review of cement standardisation in the country. The ultimate objective of the committee is to ensure that only cement that guarantees safety of buildings and human lives is produced and sold in Nigeria.

    Declaring the technical session open,  Odumodu said: “We have seen a lot of building collapse in the country and we know that most of these have caused avoidable deaths and we cannot allow it to continue. So in this meeting, we expect to get expert technical insights on the way forward in standardisation of cement. The media has been awash with varied information about different classes of cement and so to bring succour to Nigerians, we have brought together a critical mass of knowledgeable experts to provide direction on the issue.

    Continuing, the SON chief said: “Many questions have been asked by Nigerians that need answers. To be sure, there is no substandard cement produced in Nigeria because we have cement standards well elaborated in the country. But there are issues that must be addressed. For example, SON has established that people in the country, who go to the market to purchase cement for one construction activity or the other, do not actually know what they buy from the market.”

    Earlier, Odumodu explained that the technical committee is not chaired by SON. “We just provide a secretariat and it is what the committee arrives at that would be taken to the council of SON and once it is approved, it becomes a standard. Let me also state that a standard is not enforceable except the Minister of Industry, Trade and Investment designates it as a mandatory standard,” he explained.

    As Nigerians await the report of the technical committee, a cement importer, who declined to have his name in print, said there was no reason local cement producers should be allowed to produce 32.5 grade when all over the world standard has moved to 42.5 grade.

    He argued that if cases of collapsed building must be checked, there is urgent need for cement manufacturers to expand their infrastructure to produce the higher 42.5 grade of cement. He said if the government is serious about the backward integration policy in the cement sub-sector, it is necessary to ensure that the right thing is done from the onset, which is to encourage cement manufacturers to emphasise quality and standard.

    The 42.5 cement grade, according to construction experts, is stronger and has better qualities. Apart from possessing higher strength capability, the cement grade has a rapid setting quality, which makes it the preferred grade among block makers, builders and construction workers. With quick setting, blocks come out stronger, reducing the number of breakages. For now, only Dangote Cement Plc manufactures 42.5 grade of cement in all its three plants in Obajana, Kogi State; Ibese, Ogun State; and Gboko, Benue State.

    However, depending on how the technical committee set up by SON votes at the end of the session, other cement manufacturers and importers may soon follow suit and produce 42.5 grade of cement.

    Although, some people argue that there is no compelling evidence linking poor quality cement to the increasing menace of buildings collapse, the consensus is that making the higher 42.5 grade of cement the standard product in Nigeria would at least, narrow the search for the causes of buildings collapse.

  • Building industry threatened by fake cables, wires

    Building industry threatened by fake cables, wires

    Although Nigerian cables and wires are among the best in terms of quality and durability, their manufacturers are faced with lot of challenges. Many of them have received International Standards Organisation (ISO) certification, which make them the products global brands, yet the industry still contend with cheap and substandard cables from Asian countries. Weak regulation and compliance have exacerbated the problem.
    Assistant Editor OKWY IROEGBU-CHIKEZIE reports that unless the government and policy makers insist on proper regulation and compliance, the future of the sector may be bleak.

    If there is any made-in-Nigeria product that buyers have confidence in, it is electrical wire or cable. Many of the manufacturers have positioned themselves as competent players in the sector. Though their contributions to the Gross Domestic Product (GDP) are still minimal, some of them are quoted on the Nigerian Stock Exchange (NSE). Most are also award-winners in electric and telecoms cables manufacturing, but they are managing to survive stiff competition from cheap and substandard imported cables and wires.

    Studies have also traced the various cases of fire outbreaks in homes and offices to imported cables, which are usually below specification with exaggerated grade. The stunted growth in the sector has also been traced to faking and sub-standardisation. Manufacturers said faking and sub-standardisation is caused by unscrupulous businessmen who travel to China and India to not only fake original brands but also ask for reduction in the diameter of copper content of the cables and wires, adding that this is the cause of frequent fire in homes and offices. The reduction, which affects the quality of the cables, is sometimes from 2.5 square metres to 1.73 square metres, which make them  hot and unable to carry the current that consequently lead to the frequency of fire outbreaks.

    It was also gathered that the importers are able to achieve these evil machinations due to weak regulatory institutions, poor legal framework and poor policy implementations. This brings into question the capacity of the Standards Organisation of Nigeria (SON) to stem the tide of the importation of fake and sub-standard cables into the country.

    Director-General, Lagos Chamber of Commerce and Industry (LCCI) Mr. Muda Yusuf said the preponderance of cheap and substandard cables in the country is due low level of compliance with regulations and laws of the land.

     

    How fake and substandard cables come into the country

     

    According to Yusuf, importers fake documents including specification and other information about the products they bring into the country. He said: “Some of these importers come in with fake documentation, incorrect specification and information on the cables and wires they imported into the country from these Asian countries especially China and India.”

    He also said a major factor encouraging the importation of fake and sub-standard cables and wires is the decline in value system in the economy as the system gets easily compromised. He stressed that any system that can be easily compromised cannot be effective. He regretted the inadequacy of consequences for infraction and urged for adequate penalty for offenders.

    He said: “It depicts the decline in the value system of the country because the system is easily compromised. There are many unscrupulous business people who go out there to specifically request for substandard products in order to get something cheap to make a lot of profit.  In other climes, if you commit such atrocities and you are caught, you pay dearly for it because there are consequences for infractions.  If our system had been such that adequately penalises people that commit crimes, there will be a reduction of such infractions.”

    He said all these portend danger to the economy especially safety issues. For instance if one uses sub standard cables for wiring his house or office, one runs  the risk of losing one’s life savings.  There have been reported cases of fire incidence attributable to use of imported sub standard cables, he added.

     

    Way forward

     

    Yusuf said local manufacturers can assist the regulatory agencies with intelligence reports. He   noted that except they have such intelligence reports they will not be effective in their regulatory mandate. He also stated that because the local manufacturers have their distributors in the markets, it makes it easier to get vital information from them such as knowing those behind the importation of fake goods and the warehouses they are stored.

    Another challenge has to do with the nature of the distributive sector of the economy. He said it is similar to a jungle where the rule is the survival of the fittest. Because of competition, people do all manner of things to make sure that they stay afloat and in the process they compromise standard, safety and basic values just because they want to make it big.  “People engage in cutting corners.  I think it’s an orientation and culture issue that needs to be addressed by government and the people as a whole.  Our system should have deterrent functions that penalises offenders because its absence has created chaos with those doing genuine business losing money while those engaged in shady deals are making huge profit from it,” he said.

    The Managing Director, Coleman Technical Industries Limited, Mr. George Onafowokan, said local manufacturers are not only faced with the challenge of importation of fake and substandard cables into the country but also that of sufficient funds to expand capacity.

    He called for more intervention fund for manufacturers, especially cable manufacturers noting that it is only through such interventions that the sector can make significant input into the sector.

    According to him, previous government’s interventions were deployed to capacity utilisation and quality improvement.

    The crippling power sector challenge has not helped matters. Managing Director, Cutix Plc., Ifeanyi Uzodike, lamented that power has been a major challenge for the company, noting that stable power could drastically reduce the cost of doing business.

    He said: “Our major challenge is the fact that there is no power and we have to depend on our power to carry out the installations here. If you get to the factory, you will see we are running on a 1000KVA generator at the new plant and another 1000KVA at the old site. There is unstable public power; we have to burn diesel and also buy new power generating sets. We have bought new generators that would be delivered soon. The money invested in running these generators would have been ploughed back to expand production capacity.”

    “Actually, some business men who want to cut corners would go to China and ask them to produce cables to specifications that are below international standards, with the hope of making more profit. When these goods get into the country through the ports, customs officials at the ports turn a blind-eye, and allow the goods entry.”

    President, Manufacturers Association of Nigeria (MAN), Chief Kola Jamodu, urged government to disregard  the Economic Partnership Agreement  (EPA ) by the European Union. He said his argument is based on the fact that if signed, it will affect local industries.  He argued that no country can develop without protecting its industries. MAN believes that Federal Government’s efforts to enlist the support of other members of African Union to reject EPA in its present form should be sustained.

     

    Integrity of locally-made cables

     

    Indigenous cable makers say locally made cables are the best. Yusuf said generally Nigerian cables have a reputation of being of high quality, adding that they may be a bit expensive than the imported ones.

    Onafowokan said the firm’s new factory with an installed production capacity to process 15,000 metric tons of copper and 18,000 metric tons of aluminium per annum which is equivalent of 50 per cent of the country’s total capacity and power cables have proved its consistency in quality. He said the product will feed the GENCOs and DISCO (Successor companies from the unbundled Power Holding Company of Nigeria)in the power  sector reforms.  Noting that it will save the nation the much needed foreign exchange as the new owners of the power firms will not only  cheaply get the materials they need for generation,  transmission and distribution but also on time unlike when they had to import everything that they need.

    Onafowokan said if given an enabling environment, cable manufacturers will build capacity and put the nation on the right lane among the comity of nations.

    Cutix boss the firm manufactures over 14 different high quality products in the electrical wire and cable market. These include bare copper conductors on reel, bare stranded copper conductor and insulated copper conductors on Reel.

    An importer of cables and wires, Mr. Anthony Chikwe, said locally manufactured cables are the best, insisting that as a business man he must survive. Though he said not all imported cables are substandard he  agreed that some of his colleagues may not be totally free of the accusation of importing low quality cables. He blamed the regulatory bodies for not doing their jobs well and the government for not providing an enabling environment for businessmen, arguing that this makes a lot of them to think of survival first before the effects of their actions.

     

    Consequences of weak legal system

     

    Analysts say the inability to get convictions in the law courts speaks volumes of the judicial system. Yusuf said the judicial system needs to help the manufacturing sector to keep sanity in the polity. The LCCI boss said If there are situations where these economic saboteurs have been apprehended convicted and publicised, others would have sat up and do the right thing.  He regretted the unwinding legal process which makes it almost impossible to ensure that fraudulent people are convicted.

    “If people do such things and get away with it, then we have a problem and there may not be an end in sight to stopping the importation of fake cables into the country,” he said.

    Chikwe agrees with Yusuf.  According to him, since no importer of fake cables has been convicted ‘as they know their way around’, it makes it impossible for new entrants to be properly guided.

    According to him , as far as the government does not deem it necessary to put the necessary checks in the distributive trade and do proper monitoring at the borders, there will  be no end to the challenge.

     

  • Pains, gains of oil divestments

    Pains, gains of oil divestments

    International oil firms’ divestment from onshore oil fields is gathering momentum. To some, this is a welcome development for indigenous companies as it will help them to build capacity, but to others, it portends danger for foreign investments as the divestments could mean that all is not be well in the sector. Senior Correspondent AKINOLA AJIBADE reports.  

    THE international oil companies (IOCs) in Nigeria have been divesting some of their assets considered marginal and commercially unviable. Such marginal oil blocks were handed over to local oil companies, which are small in both balance sheet size and technology, to aid them make foray into exploration and production.

    However, from 2009, the game changed. The IOCs began to divest, not just from oil blocks that were considered marginal, but also those with considerable oil and gas reserves that have substantial commercial value and make good business to operate in.

    Since 2009, oil giants, such as Shell, Chevron, ConocoPhillips and British Gas, have sold no fewer than 20 oil blocks, which are considered juicy.

    Shell is about concluding sale of four oil blocks. With the sale of interests in the four blocks, the number of blocks in which Shell Petroleum Development Company (SPDC) would have divested its stakes since 2010, would be about 10.

    Although these divestments are coming at the peak of the oil and gas industry reforms, which aims at promoting Nigerian Content development, local capacity and capability, industry observers said it is both good and bad.

    To them, the transfer of such assets certainly would boost the drive to grow indigenous capacity in the exploration and production, and position Nigerians and local firms to take control of the industry. They, however, argued that the remediation of the polluted and damaged environment would be at a huge cost to indigenous companies buying up these assets.

    Besides, they said the absence of a requisite business operating environment, a major factor responsible for the divestment is not adequately addressed by the government, the indigenous oil firms would also find it difficult to operate the assets. They listed challenges such as crude oil theft, pipeline vandalism and kidnap of oil workers for ransom, among others, as some of the issues government must address to create the environment for the locals. They also noted that addressing these issues becomes imperative because local firms get funds at very high cost and should anything happen resulting in undue delay, or shut-in of such assets, the affected companies may go bankrupt.

    They said: “Undoubtedly, divestment will enable local operators to engage in  exploration activities regarded as  the exclusive  preserve of the IOCs, and will ultimately increase their contributions to the nation’s gross domestic product (GDP).”

    According to Ecobank Research, by the end of last year, the IOCs would have sold at least 300,000 barrels per day (bpd) worth of equity in onshore and shallow water producing assets in the Niger Delta region. We estimate that the corresponding monetary value of these divestments will be in the region of at least $5 billion. In addition, the total number of blocks divested by IOCs between 2010 and end of 2014, will surpass 22, the research said.

    Earlier, Shell and its partners,  Total and Agip sold 45 per cent interest in onshore Oil Mining Lease (OML) 40 to Elcrest Nigeria Limited. The SPDC  also sold its 30 per cent interest in OML 30 with share production of 11,000barrels per day (bpd) in the Niger Delta to Shoreline Natural Resources Limited.

    Total sold its 20 per cent stakes and operating mandate of its Nigerian offshore project to a local unit of China Petrochemical Corporation for $2.5billion.

    Besides, US oil firm, ConoccoPhillips disposed its assets in the country to indigenous oil company, Oando Plc. The deal is said to have jerked up oil the major’s assets’ sale to $11 billion last year.

    Brazilian oil firm, Petrobras, which began operations in Nigeria about 20 years ago, has put the country on notice of its intention to auction its stakes in Nigerian oil fields to raise cash for domestic projects.     The firm plans to sell its eight per cent stake in the Nigerian offshore Agbami block, which is operated by another US oil major, Chevron and its 20 per cent share of the offshore Akpo field, operated by French oil firm, Total.

     

    IOCs’ stand

    The oil majors say their divestment decision was informed by the need to grow the country’s petroleum sector.

    The Managing Director, SPDC, Mutiu Sunmonu, said part of the reasons for his firm’s divestment of its assets was to encourage indigenous participation in the upstream oil and gas sector.

    Sumonu, who spoke in an oil and gas forum in Lagos, said: “We want to create a new set of indigenous players in Nigeria’s oil and gas industry within the next 10 to 20 years from now, while the IOCs concentrate on more difficult issues and also allow us to focus on material oil and gas fields.”

    Total’s Chief Executive Officer, Christophe de Margerie, said the disposal of his company’s assets does not mean it is leaving Nigeria’s  shores, but that the divestments are being carried out to give room for indigenous players in the nation’s petroleum sector to grow.

    Also, the Chief Executive Officer, Petrobras, Ms Maria das Graças Foster, said divesting from the oil blocks would help the company concentrate more on exploration activities in a vast deep sea region off the coast of Brazil, known as the subsalt, believed to contain dozens of billions of barrels of high quality oil.

     

    Stakeholders’ position

    But stakeholders said the divestment of stakes might be linked to the fact that IOCs were considering that some of the onshore assets as ageing and becoming unviable. According to industry players, the divestment allows the companies to prioritise the most attractive opportunities and reconfigure, or exit from less attractive ones.

    In addition, incessant crises between the host communities and the oil firms would have prompted the divestment for deep water prospect where there are fewer community related issues and less financial expenses on conflict resolution. They argued that the decision could also be linked with what the industry players consider as unfavorable profit-sharing agreements, high royalties, taxes and insecurity, considering the production output of the fields.

    Chairman, International Association of Drilling Contractors (IADC), Nigeria Chapter, Sola Falodun, said the problems in the Niger Delta region were affecting crude oil production, adding that it is becoming difficult for IOCs to produce enough oil from their fields. He said the divestment had given IOCs an opportuntity to relocate to safer environment.

    The  President, International Association of Energy Economics, Prof Adeola Akinnisiju, said multinational oil companies were divesting their shares because of security problems in the industry.

    He said the frequency of attacks on facilities of the companies in the onshore area had put investments and stocks of the companies in danger. He, however, said divestment is not bad as it will give indigenous companies the opportunity to have a good stand in the sector.

    He said the level of indigenous opportunity depends on how well the local players are able to exploit the fields to the advantage of Nigerians through investment in research and development.

    He said divestment would aid the development of marginal oil fields. Akinnisiju said the future is bright for indigenous firms, adding that the divestment will jerk up oil production.

    He, however, said  the assets divestment is a smokescreen designed by the IOCs to run away from responsibilities for the environmental despoliation oil exploration has caused the host communities.

    “There is a generally deep displeasure by the communities whose environments they have damaged without redress. This dislike or disdain poses a peculiar risk to companies that had entered those communities on th  crest of expectations and promises,” he said.

    He said the companies were eager to shake off accountability for the damage they have done to their host communities, adding that they are not ready to clean up the oil-polluted areas. According to him, the IOCs may be unwilling to adjust to a regime that requires that they be more transparent.

    He said: “A situation where oil theft and frequent leakages do not result in reduction in official oil production levels clearly shows that far more than officially acknowledged, volumes of crude oil are being extracted from these fields. So, these corporations are trying to avoid responsibility.”

    He said the IOCs are playing an arm twisting game with a government that relies heavily on oil rents. “Threats of divestment can affect the passing of the PIB  (Petroleum Industry Bill) and if passed, its implementation. These fellows are playing games. They cannot run away from the incredible gains they make here,” he said.

     

    Divestment a threat

    Executive Director, African Heritage Institution, Ifediora Amobi, said the auction of these oil blocks and their gas resources would threaten Federal Government’s power sector reforms by jeopardising domestic gas supply for power generation.

    According to him, it will lead to job losses and insecurity, as “we hope that some of the displaced workers from Shell, Total, others, who will be absorbed by the local firms, have the same working conditions they were used to under the oil majors”.

     

    Labour kicks

    Oil workers say divestment is ill wind that blows nobody good.  President,  National Union of Petroleum and Natural Gas Workers (NUPENG), Comrade Achese Igwe, at a joint press conference in Lagos penultimate week, warned Petrobas of the severe implications of divesting its assets in the country.

    Last Tuesday, oil workers in a Brazilian firm demonstrated against the plan to divest. The workers protested at the Lagos office of the company, wondering why Petrobas is planning divestment at the time when their stakes were high. They said the  decision of the company to leave the country meant they would be out of job noting the severe economic implications to their families and the nation. They also criticised government for not doing enough to guarantee them job security in the hands of the foreign oil companies.

    Lagos Chairman, Petroleum and Natural Gas Senior Staff Association (PENGASSAN), Rev Folorunsho Oginni, said the decision to divest is not in the interest of workers and the country. He lamented that expatriates in the employ of the IOCs repatriate several millions of dollars year to Brazil at the expense of Nigerians.He said the workers have despatched  protest letters to the Ministers of Petroleum Resources, Labour and Productivity to halt the wave of divestment.

    According to him, the union will not hesitate to mobilise members on a national strike if the two ministries fail to address their grievance at the  appropriate time.

     

  • Tackling the unemployment scourge

    Tackling the unemployment scourge

    Despite the Federal Government’s initiatives, such as the Subsidy Re-Investment and Empowerment Programme (SURE-P), the Youths Enterprise With Innovation in Nigeria (YouWiN) and others, designed to tackle unemployment, the problem persists. If steps are not taken to urgently tackle the monster, it may pose danger to the country, writes TOBA AGBOOLA.

    The content of the report was disturbing. It painted a bleak picture of unemployment in the world.

    The Global Employment Trends for Youth released by the International Labour Organisation (ILO) reported that an estimated 73.4 million youngsters worldwide are out of work.

    According to ILO, the figure represents 12.6 per cent, close to the levels reached at the peak of the economic crisis in 2009 and an alarming increase of 3.5 million between 2007 and last year.

    The report warned that the long-term impact of youth employment could be felt for decades, creating a generation at risk of suffering decent work deficits throughout their lives.

    With this report, the growing youth unemployment in Nigeria should be a source of worry for the government.

    The report noted that two-thirds of the working age population in the country are either unemployed or trapped in low-quality jobs.

    In a country where accurate figures are hard to come by, it is feared that the youth unemployment rate in Nigeria is far more than what is published.

    According to industry watchers, over 60 per cent of young people are either unemployed, working but in low quality, irregular, low wage jobs, often in the informal sectors of the economy, or not in the labour force.

    The Nigeria Labour Congress (NLC) warns that the rising youth unemployment is undermining the country’s stability.

    Its President, Abdulwahed Omar, called for a decisive intervention to tackle the problem. He warned that if left unchecked, the unemployment crisis could undermine peace and security.

    Omar said: “Official statistics put the national unemployment rate at approximately 24 per cent. About 35 per cent works but in low quality, irregular, low wage jobs, often in the informal economy. As high as this rate is, it, nevertheless, camouflages the enormity of the unemployment crisis in the country. If unemployment and disguised unemployment were to be added to the figure, the crisis will become more glaring.

    “With an estimated 80 million youths in the population, between 30 and 40 million unemployed youths constitute a veritable army of the hungry, disillusioned and angry. This set of people can undermine the stability, security and peace of any nation if left unattended to. There is an urgent need for decisive intervention to rein in the unemployment problem. The signal of strife and insecurity today are warning banners we cannot afford to ignore.”

    Director-General, Nigeria Employers’ Consultative Association (NECA) Mr Segun Oshinowo said the government and private sector should be blamed for the problem.

    He said: “Nigerian youths have to do more in their quest to fight unemployment. Youth unemployment has persisted because many, including those with several degrees and qualifications, have failed to take advantage of the peculiarity of what the nation economy offers.”

    According to him, over the years, particularly, since the past decade, the issue of youth unemployment and the dangers it portends for nations and economies has become a major challenge for governments at states and national levels. Experts and professionals have consistently proffered different types of solutions to combat the problem. It was time, he added, that the nation’s youths latched on to one or more of these initiatives to combat their unemployment situation.

    Toeing the same line with him, the Director General, Industrial Training Fund (ITF), Prof Longmas Wapmuk said many youths have not bothered to improve their skills and improve their success chances through learning, networking and engaging in creative ventures that would make them become self-reliant without being dependent on paid employment that may never come.

    He said self-employment remains the only solution to the high unemployment rate among youths in the country and maintained that youth unemployment has persisted because the youth have refused to adopt measure that will see them becoming self-reliant.

    The Lagos Chamber of Commerce and Industry (LCCI) believes youth unemployment has continued to grow because youths have failed to explore the various options available to them to get engaged in both the medium and long term jobs.

    Its Director-General, Mr Muda Yusuf insisted that the country’s youths could end the scourge of unemployment if they could only look at how to improve their inherent skills with the aim of being the best in whatever they do.

    According to him, there is a huge untapped market in the agriculture sector, particularly in Cassava growing.

    He said: “There should not be any reason why any intelligent youth should complain of unemployment or remain in poverty. The agro-allied sub sector alone, can effectively tackle a large part of the unemployment challenge, if youths decide to key into it.”

    An expert in human resources management, Sunny Agboju, said entrepreneurial concepts have been identified as the most formidable factor for combating the unemployment scourge.

    Agboju, Recruiter and Managing Director, Prot Consulting Limited, lamented that youths have not shown enough determination in the battle against unemployment, arguing that many of them are lazy.

    According to him, many of them, in spite of parading several certificates, lack the ability to write and speak properly at certain levels. Many jobless youths complain about the challenges that come with turning concept into reality without being ready to face the challenges associated with it.

    Recently, the Joint Action Front (JAF) began a nationwide rally in solidarity with all categories of unemployed Nigerians , as well as working and oppressed people in the country.

    JAF said this is part of its continuous exercise to demand the rights to jobs opportunities for all Nigerians irrespective of sex, ethnic or religious background

    Speaking at the mass rally, its Chair, Dr. Oladipo Fashina declared that the rally continuous exercise would take place in the six geo-political zones of the country with Lagos as the starting point.

    He said: “As we kick off this nationwide mass rally at the Nigeria Civil Service Union Alausa-Ikeja, Lagos, we appeal to all Nigerians that this is a continuous exercise that would take place in the six geo-political zones in the country with Lagos as the starting point.”

    “We, therefore, call on our labour partners, the NLC and Trade Union Congress (TUC), the unemployed and all pro-oppressed and working people groups across the country to join our rallies effective to all the institutions of governments at all levels, including the Houses of Assembly to demand decent jobs with living wages for all unemployed Nigerians.”

    He noted that the kick off is clarion call to Nigerians to arise to the challenge of system change, which to JAF means the socialist transformation of the polity.

    Also, JAF’s Secretary, Comrade Abiodun Aremu, said: “Our position in JAF on the tragic incident of the death of scores of applicants during the Nigeria Immigration Service (NIS) job recruitment exercises of March 15, this year is that, governments at all levels, the federal, states and local governments, irrespective of political parties, are culpable because they failed to provide decent jobs and enabling opportunities for gainful employments.”

     

    The way forward

    On the way forward, Omar said: “To overcome the problem of unemployment, Nigeria must promote strong industrial policies that recognise manufacturing as a key engine of growth and decent mass employment for the national economy. The Federal Government must urgently initiate a range of measures to revive and project labour-intensive industries like textiles, food and beverages, construction, iron and steel sectors, and others”.

    Wapmuk said the panacea to ending youth unemployment in the country, includes amongst others, youths re-orientating themselves and positioning their inherent skills for value change.

    He said: “Change of attitude by the youths is crucial. Only self-education can make them successful. You can only earn a living with education; but with self-education, you can earn a fortune. They must pursue their passion vigorously and that will open doors for them.

    “There are opportunities in the reforms that the government is doing in different sectors. It is expected that youths look out for the smallest in value chain in the reformed sector, including in areas where they don’t need to approach a bank to get big loans. They must be aware, go through the Internet and maximise the knowledge deposit in it.”

    Oshinowo said every policy action and decision of government should be judged on the basis of its impact on job creation.

    He said: “We cannot, of course, ignore the factor of good governance, as aptly exemplified by the Lagos State success story, which has created the most basic of skills.”

    “All the aforementioned policy options should be underpinned by a sincere constitutional amendment that will enthrone true federalism and resource control. We should aim for a political structure where federating units will contribute to the centre, thereby assuming the status of multiple centers of productive economic activities and development. This, surely will spin off jobs in their millions and create sustainable employment.”

    He urged the country’s youths to take their destinies in their hands and cease blaming the government and private sector operators for their unemployment woes.

    ILO report urged governments to take immediate and targeted action to tackle the youth unemployment crisis. It further called for concerted efforts by employers’ organisations and trade unions across the globe.

    The ILO urged policy makers to work together with social partners to address this alarming situation. The 2013/14 edition of the ILO’s Global Employment Trends for Youth report analyses a number of key policies and action that can be taken.

    Coordinator of the ILO Youth Employment Programme and co-author of the Report, Gianni Rosas, called for a strong focus on growth and jobs, including through a more coordinated macro-economic response at national and global levels.

    The report stressed that there is no “one-size-fits all” solution, adding that the key policy areas, identified in the ILO’s June 2012 call for Action is a global framework, which can be adapted to national and local circumstances.

    The report also called for fostering pro-employment growth and decent job creation through macroeconomic policies, employability, labour market policies, youth entrepreneurship and rights to tackle the social consequences of the crisis, while ensuring financial and fiscal sustainability.

    It stated that comprehensive measures targeting disadvantaged young people in advanced economies with high numbers of unemployed youth should be put in place. These include education, training, work experience support and recruitment incentives for potential employers.

    It further called for integrated employment and livelihood strategies and programmes in developing countries, including training in literacy, occupational and entrepreneurial skills and business.