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  • Local content: Erring firms will face sanction, says Board

    Local content: Erring firms will face sanction, says Board

    The Nigerian Content Development and Monitoring Board (NCDMB) will sanction any firm that flouts the local content regulations, its Executive Secretary, Ernest Nwapa has warned.

    Nwapa said in Abuja, that those who fail to comply with the Nigerian Content Act would not go scot free.

    He said work stoppage would be applied to ensure compliance with the Act, noting that the Board had dialogued, corrected and cautioned non-compliance in the past.

    He said the NCDMB had given operators adequate opportunity to comply, and that it would ensure the the law was complied with.

    Nwapa said the operators were given enough time to adjust to meet NCDMB’s goals.

    He said the Board focuses on consolidating its Capacity Development Intervention (CDI) initiatives, and creating awareness on the Nigerian Content.

    He lamented the slow pace of development of the manufacturing capacity of indigenous players, stating that if the manufacturing capacity of the firms is not developed, all the achievements recorded under Local Content would fizzle out.

    According to Nwapa, the performance level of indigenous operators, in engineering is 90 per cent, fabrication – 60 per cent, while manufacturing is 10 per cent.

    “If the manufacturing capacity of the indigenous players is not raised, we will not get the much needed growth of Nigerian content,” he said.

    He said $5 billion (N800 billion) had been invested in the development of new yards and upgrade of existing ones since the introduction of the Nigerian Content initiative, adding that the solution to growing indigenous capacity through local content lied in taking and keeping value.

    According to him, Nigeria should focus on developing indigenous capacity instead of looking for assistance, adding that the country has lost a lot of money, as a result of failure of companies to develop local capacity.

  • Local content law for power sector coming

    Local content law for power sector coming

    The Nigerian Electricity Regulatory Commission (NERC) has said the power sector local content regulation will transform to law next month.

    Its Chairman, Sam Amadi, disclosed this while making a presentation at a session in Chatham House, London. The session was chaired by Peter Callaghan of Commonwealth Business Council.

    Amadi, who was lead speaker at the event organised by Chatham House, pointed out that the power sector local content law is intended to avoid the mistakes made in the oil and gas sector where it is still dominated by expatriates 50 years after.

    He said: “We have a local content regulation that by February should become law; we don’t want what happened in the oil and gas sector where after 50 years Nigeria is still importing technology. We have come up with a local content regulation that provides a framework for every company to begin to localise both technology and services.

    “For example, a meter provider should within the next five years set up a factory in Nigeria. This is to ensure that the spill off from electricity reform goes to enhance the economy of the nation.”

    Amadi also told the gathering that power supply is expected to hit 7,000megawtts (Mw) by the end of this year as increased capacities are expected from the National Independent Power Projects (NIPPs) coming on stream, while generation benchmark is set at 20,000mw by 2017.

    He however, noted that early passage of the Petroleum Industry Bill (PIB) was critical to achieving the set targets. He disclosed that the 7,000mw target set for 2013 could not be realised because of inadequate supply of gas to power the plants , which the PIB can help reverse.

    “PIB is critical to move forward on gas to power the plants, the law should be passed as soon as possible, although the debate over it is huge but we want the matter to be resolved in a way that makes gas to power commercially viable and bankable. At the end of 2013, we had expected to hit 7,000mw and that would have been possible if there were enough gas to fire the plants and the NIPPS that will come on board.

    “By end of 2014 we will definitely cross 7,000mw because of the NIPPs; if you put all the capacity together, you will get over 4,000mw, and the existing 4000Mw. The benchmark is that by 2017 we expect that Nigeria electricity market will have over 20,000mw trading then.

    “The PIB is critical to us because the constraint of the sector now is gas to power and except you have a very intelligible, practical and commercial framework over gas in Nigeria you might not have sustainable solution to the crisis,” Amadi said.

  • ‘Nigerian Content Act is a blessing’

    ‘Nigerian Content Act is a blessing’

    The Chairman, Chief Executive Officer, Gibles Oil and Energy Group Limited, Prince Blessing Omogbemi, is a beneficiary of the Nigerian Content initiative. In this interview with Deputy Business Editor SIMEON EBULU and Assistant Editor EMEKA UGWUANYI, he explains how the law has helped his business to grow.

    What is your assessment of the Nigerian Content Act?

    The Act is very good because most of the provisions are geared toward promoting indigenous capacity development. Section 47 of the Act says that the operators should set up manufacturing factories to produce some of the ancillary equipment such as nuts and bolts, among others in-country and invest in facilities, so the wealth spent on importation of these items should be retained in Nigeria. Unemployment is a major challenge to the country and without the establishment of factories here in the country, we cannot eliminate or reduce unemployment.The Act helps both the international oil companies (IOCs) and the indigenous companies in the oil and gas industry because it created opportunity to manage the industry within. It helps the government to be focused as well as Nigerians willing to do business the right way. It gives the indigenous firms opportunity because if not for the Act, I wouldn’t be doing a job in Escravos Gas-To-Liquid (EGTL). It will promote the local community contractors, all the indigenous companies financially and socially but one thing will happen. We have to be prepared. The vision we have is not just for our company but also to leverage individual potential at community and national levels. It is the Nigerian Content Act that will give us the room to operate but we have to think about equipment acquisition, and yards. Most of the fabrication jobs are carried in South Korea. If these jobs are continued to be done overseas, when will Nigerians take over? I believe this is transition period and Nigerians should competently take their rightful place in the industry. It should be a gradual process but we have to be prepared in terms of financial capability, right personnel and good facilities.

    Which other multinational company has boosted Nigerian Content?

    I will continue to mention Chevron because 90 per cent of the jobs my company has done came from Chevron, while Addax is about five per cent and the remaining from Nigerian National Petroleum Corporation (NNPC).

    What are the contracts Chevron gave your company?

    In 2005, we got our first contract from Chevron, which was double-jointing of floating pipeline. It was in Warri and I used a fabrication yard in Warri to do it. Another one is the EGTL project, which involved painting and sand-blasting jobs, re-factory and supply of labour. We are also looking at another one that we are still working on, which we will partner with our partner in China. We are proposing the construction of a factory in Ogun State. We are still talking with the Ogun State Government and they said the land is ready. The factory will manufacture bolts and nuts and we will partner with the state government on the project as well as our Chinese partners. We also have plans to go into agricultural project, where we will do poultry farming and plantation. We are talking with Chevron on that project because the company has a foundation called PING Foundation, which plays in the agricultural sector, to see how they can support us. We are talking the officials PING Foundation and have promised to talk to Diamond and Fidelity Banks to finance the agricultural project. We have already acquired two acres of land in Ogun State for the project within the area Olokola LNG project is situated. We have not concluded on the discussion, by the time we conclude, I will give update on the level of their support.

    How much has your company earned from the contracts secured from Chevron?

    I cannot really talk about the amount but I can say that the business I have done with them since 2000 to 2013, has been very profitable. There was no record of loss but profit.

    You mentioned agriculture and you play in oil and gas, what is the relationship between the two?

    The PING Foundation is just to help the people in Niger Delta region and because Chevron operates in the region, the company explores areas where it can help the people, look at what they lack or what will benefit them and see how it can provide these things. The company encourages development of small and medium scale enterprises (SMEs) through the foundation. It is a body just the way I have the Perfect Care Foundation in order to take of the people where it operates. I think, it is just to take care of the people it works in their land and also to empower them.

    Should we say that the initiatives by Chevron and other IOCs by extension are part of measures to curb or eliminate militant activities in the region?

    I think it is part of it and it is the way forward because if everybody is busy nobody will be willing to be involved in militant activity. Chevron believes that the best way to help, engage and empower the people in the region is not by giving them money but by teaching them how to make the money on their own. The company doesn’t want the people to engage in fraudulent activities and the best way to handle the issue is to set up the PING Foundation. The foundation takes care of those willing to do business or vocational activities male and female alike because the major occupation of the people in the region is fishing and farming.

    Can you throw more light on the agriculture project and in which areas will your firm to be involved?

    The areas the foundation supports include poultry and cassava farming. It is also looking at marine activities such as vessels acquisition.

    The jobs you did for Chevron and Addax, how did they translate to job and wealth creation for Nigerians?

    I may not be able to say exactly but on the EGTL project not less than 10,000 Nigerians, including engineers, welders and contractors, among others, worked on it, which shows that Chevron is concerned about Nigerians and I can say it is a major promoter of Nigerians in job creation.

    There may be other indigenous firms that want to do contracts with international oil companies but dont know how to go about it. How did you become Chevron’s contractor?

    What I was doing for Chevron before 2000 was supply of fish, shrimps and prawns, among others to Nigerian caterers who cook for the company. At a point, I thought I have to upscale my business. I proposed to build a cold room at Awoye in Ilaje where Chevron has a facility because suppliers didn’t have cold rooms then. The cold room could have been built within the shortest period but the crisis between the Ijaw and the Ilaje in 1998 stalled the cold room business. We have finished constructing the structure but couldn’t continue with the business because of the crisis. I decided not to continue with fish business and veered into construction in 2000, registered Gibles Group with CAC and in the same year registered as a contractor with Chevron.

    How do you source your funds?

    Our projects are financed by local banks. Our first project was financed by Intercontinental Bank now Access Bank. The funds for the EGTL project were sourced from First Bank. Chevron gave us 30 per cent mobilisation and the remaining 70 per cent came from First Bank. We used the contract paper and some properties as collateral to get the loan.

    Gibles Group has six subsidiaries including oil and gas, marine and logistics and hospitality, among others, do you have a technical partner either foreign or local or do you operate a one-man show?

    We believe in partnership because it works. I don’t subscribe to family business that one manages with your wife and son because of you people are not resourceful and don’t have ideas, the company will just die. We don’t want that. Based on our vision, we have many things we want to do and we cannot do it with one company. Gibles is into engineering services including blasting and painting, fabrication, manufacturing, procurement and equipment leasing. But Vital Oil Limited is for downstream. Our downstream operation will come on stream next week. We will be marketing premium motor spirit (petrol), automotive gas oil (diesel) and dual purpose kerosene. We will start our marketing and distribution outlets in Lagos where we will move on to other parts of the country.

    What informed your desire to play in the downstream sector?

    Playing in the downstream sector has been part of our initial plan and vision. We don’t want to put all our eggs in one basket. We cannot concentrate only on the upstream. The emergence of shale oil and gas, according reports, will have negative impact on the country’s upstream sector; therefore, we want to diversify into other sectors. We also look at our role models such as Mr Aliko Dangote and Chief Mike Adenuga. They are into different sectors of the economy and that is the way we want Gibles Group to go.

    What is your budget for Vital Oil in the short term?

    We are working banks and I don’t want to disclose exactly our budget but it will not be less than N150 million for a start. We want to start with distribution of AGO (diesel) and renting of filling stations. We don’t want to start construction of new filling stations immediately. We want to rent filling stations for at least a year. We are talking with depot owners for products purchase. We have already paid for four trucks that will carry the products. We have also concluded training for the personnel that would do the job. These preparations delayed our taking the final investment decision (FID). The downstream marketing is a profitable business but one has to be very prudent in running it. We will finance 25 per cent of the cost while banks will do the remaining.

    Are you looking at vessel acquisition and importation of petroleum products in future?

    We are just dealers because we haven’t got licence to carry out the business you are talking about but we are working on it. One of the products codes registered with NIPEX includes vessel acquisition under the marine logistics. We have secured certificates from NIMASA and NPA.

    What is your take on deregulation of the downstream sector?

    Deregulation is good but the government should assist operators in the downstream because the cost of funds (securing loans is high). Government should see how to come in and make banks’ interest rates come down.

    What are your challenges?

    The most challenging area is securing funds to finance projects because if you go to the banks they ark you will bring all manner of collaterals, get this and that. If not because I have assets in Lagos and other places, it would be difficult for me to secure loans from banks. Another challenge is in the area of skills development. Government should find way of making Nigerians to be trained to be able to take over from the IOCs. Many locals lack skill and expertise and are very lazy. Nigerians should set up requisite training centres to train Nigerians.

     

  • Why local content failed, by NITDA

    WHY has the local content policy not made an impact? It is because of the government’s inability to convince its ministries, departments and agencies (MDAs) to patronise local software and original equipment manufacturers (OEMs).

    Director-General, National Technology Development Agency (NTDA), Prof Cleopas Anagaye, said these OEMs lacked capacity, throughput and performance analyses.

    He spoke at a forum by the Pan African University, Lekki, Lagos entitled: Role of ICT in the transformation agenda in job creation.

    He said when the directive to partonise the OEMs was issued in 2006 during Obasanjo administration, the aim was to grow the local OEMs for job creation.

    But one of the local OEMs, Beta Computers, described the allegations as baseless, insisting that none of the factories of the local OEMs is running above 25 per cent.

    Its Managing Director,Will Anyaegbunam, said the MDAs misinformed the NITDA chief, adding that the mentality to keep patronising foreign brands and inability to monitor and sanction erring MDAs are responsible for the situation.

    “Seven years down the line, another directive was issued last year. Let the MDAs come out and say, ‘We gave this OEM jobs to do, but it could not meet up with quality and schedule of delivering the job.’ They keep advertising foreign brands in their offices.

    “As for support, they are talking balderdash. NITDA should monitor and sanction them. Toyota, IBM and other world class manufacturers have had causes to recall goods already in the market. NITDA is a technology development agency. It should help in developing OEMs,” he said.

    Angaye said the ‘directive’ required that they should patronise indigenous software and computers. He insisted that no sooner had the directive been implemented than the MDAs, especially, public institutions, started complaining.

     

     

     

     

     

     

     

     

     

     

     

     

     

  • ‘Underwriters yet to tap into local content’

    The insurance industry is yet to take advantage of the benefits of the local content policy due to low human capacity, Dr. Wole Adetimehin, President Chartered Insurance Institute of Nigeria (CIIN), has said.

    Adetimehin told reporters in Lagos that the situation had remained a challenge to the industry.

    According to him, nobody can fault the underlining reason of the local content policy initiative, which cuts across the sectors of the economy, noting that in appraising the benefits so derived from the sector, stakeholders were having the fears as to what report they would give.

    He said from all facts available, they were yet to start. Though there had been some participation, it was still far from what was expected, he added.

    He said: “I would say this has remained a recurring challenge facing our industry, which is more prominent with the underwriters. Nobody can fault the underlining reason of the local content policy initiative and it is meant to cut across all the sectors of the economy. But in appraising the benefits so derived from the insurance sector, we are all having the fears as to what conclusion or report card we would give at this time. This is because from all facts available in real and concrete terms, we are yet to begin.”

    Adetimehin said there was need for the industry to address the challenge in a more pragmatically by re-strategising and one of such ways is for stakeholders to come together and evolve solutions.

    He noted that the idea of everybody going about it alone could not resolve the challenge, adding that at the institute’s level, the challenge is to promote training and curricular that would open or widen the minds of practitioners to what to do.

    He further said though the capital base of companies have grown beyond imaginable scope, a lot more is expected.

    “You do not underwrite or shoulder risks with your capital. You can only provide infrastructure that would propel you to underwrite. What needed to be developed is the capacity to absolve. Stakeholders should be advised to shun independent approach to doing things and align more effectively to the fundamentals of insurance practice globally, which is pooling and sharing of risks.”

    “The experience has been fairly good in the oil and gas, but if stakeholders can come together under pool formations at many levels, capacity would grow. We would even go beyond the shore of Nigeria to absolve risks,” he said.

    The National Insurance Commission (NAICOM) to reduce capital flight in the country and enhance the participation of local insurers in the oil and gas business, released guidelines to regulate the operations of the business in December 2010.

    The rules stated that no person or organisation “shall transact an insurance or reinsurance business with a foreign insurer or reinsurer in respect of any life, asset, interest or other properties in Nigeria, classified as domestic insurance, unless with a company registered under the Insurance Act 2003.”

  • Local content push for job prospects

    Local content push for job prospects

    The local content policy is all about domestication of technologies and skills. The policy, according to information communication technology (ICT) experts, will open job opportunities for the unemployed, writes AKINOLA AJIBADE

     

    For the unemployed, all hope is not lost.The local content policy introduced to drive the information communication technology (ICT) sector unlocked some activities hitherto not done in the country. The Ministry of Communication and Technology initiated the idea to encourage patronage of locally-produced ICT products.

    The policy promotes domestication of technology, using indigenous capacities and resources. Subsumed in the policy is employment generation. In fact, the initiative is expected to lead to the development of skills in the country.

    Before now, critical components, such as hardware/software production,were farmed out to expatriates believed to have higher level of competence. The arrival of local producers, such as Omatek, Zinox and Vedan, did not change the situation because they all import and assemble ICTs’ facilities.

    But with the growing advocacy for adoption of local content by stakeholders’activities done by expatriates are being handled by Nigerians and this is creating employment. Stakeholders say the essence of local content is that globally it comes with substantial job prospects, if well-implemented. They said Nigeria has a huge market, adding that it would not be long before people start creating jobs in the ICT industry locally. They said lower, semi and highly skilled people would get jobs in the industry soon.

    They said jobs would be available for researchers, software developers, programmers, marketers, technicians, welders and iron benders, among others.

    The Managing Director, Teledon Group, Mr Emmanuel Ekuwem, said the local content initiative revolves round five major areas namely the hardware, software, physical infrastructure, technology integration and expertise. Ekuwem said there were immense job’opportunities in the five areas, urging Nigerians to explore them for growth. He said the areas are of critical importance to global ICT industry, adding that nothing can be done successfully without them.

    He said Internet Service Providers (ISPs), Global System for Mobile (GSM), communication operators and Code Division Mobile (CDMA), among others, would provide skilled and unskilled labour through the local content policy.

    “There are thousands of welders in Aba, Owerri, Enugu, Ogbomoso and other places in Nigeria who can weld steel well. Why should telecoms companies or ISPs import readymade towers or masts from Europe and the United States when we have welders who can do the jobs perfectly at lower cost? With local content policy gaining prominence, we should be expecting huge employment prospects soon. Many welders and their auxiliaries like suppliers of iron, and steel would experience a boom in business activities. In the long run, directly or indirectly, jobs would be created for the teeming population,” he said.

    He said many people would get jobs as a result of technology integration soon, arguing that the policy creates room for people to combine different technologies together to achieve the desired objectives.

    Ekuwem said there are Nigerians who can develop good software, stressing that they would get more jobs to do it when the local content policy is fully implemented.

    “Since the likes of Nigerian Computer Society(NCS), and the Institute of Software Practitioners of Nigeria (ISPON) are firmly on ground, it would not be long to see more Nigerians venturing into software development to maxmise the gains of local content. It would be amasing to know that there are huge prospects in software creation locally,” he added.

    According to him, the market of producers of barb wires would increase, as a result of the execution of local content policy.

    “Why should we import barb wires to fence the sites? Why should we import portakabin for generators installed at the sites? he asked rhetorically.

    He said these things can be done locally, stressing that people would leverage on local policy to produce them in large quantities and further create jobs. He advised Nigerians to go for skills acquisition in ICT, arguing that this is the only way they could reap from the implementations of the policy.

    The Chairman, Zinox Technologies, Mr Stan Leo Eke, said the introduction of local content policy would create jobs for people, arguing that the unemployed would get jobs when more telecom plants are sited in the country.

    Speaking during a stakeholder’s forum in Lagos, Eke said the industry will use the Nigeria Content Advocacy Initiative (NiCADI) to drive local content initiative and further bring more Nigerians into employment nets. NiCADI is an advocacy project that promotes local usage of ICT facilities, competence, among others.

    Eke said Veda Computers and Omatek, among others, have provided jobs in the country, adding that more people would be employed as new plants roll out operations. He said Original Equipment Manufacturers (OEMs) operating abroad would be invited to produce semi and final ICT products at cheaper rates in Nigeria. He said when this happens, more opportunities would be provided for job seekers in the country.

    He said: “Backward integration is the trend all over the world. There is a flipside in the production of ICT facilities globally. The level of activities among the producers, suppliers, and sellers is inter-changing. We are trying to ensure that OEMs get a space to operate in Nigeria. By this, products that are hitherto shipped into the country would be produced locally. The development will provide jobs, increase productivity, and grow the economy.“

    He said an appreciable level of competence is required from Nigerians, who want to get jobs through the local content concept. He said research and development cuts across every facet of production of ICT‘s accessories, adding that the area would need more workers.

    Eke said people in ICT are in futuristic business than their colleagues in banking and the oil and gas industry, observing that the prospect is brighter for as many Nigerians that are ready to earn a living in the sector.

    The President, Association of Licensed Telecom Operators of Nigeria (ATCON), Mr Lanre Ajayi, agrees. Ajayi said the local content policy comes with a lot of benefits for the operators and the economy in particular. According to him, the benefits include creation of a viable market for operators, increase in capacity, transfer of skills, among others.

    Lanre said the job’ potential are numerous, noting that people will get employed irrespective the ICT skill they have when local content policy is introduced in the country.

    He said the bulk of the software used in Nigeria are imported from Europe and the United States, adding that many would leverage on the local content policy to develop their own websites for growth.

     

  • $180m content fund scheme set for take-off

    The planned pilot scheme on how to use the Nigerian Content Fund meant to aid Nigerian oil and gas companies secure loans from banks for projects and capacity development, will start this month, it was learnt.

    The fund was established in view of the constraints experienced by local firms in accessing loans from banks. By virtue of the Act establishing the fund, one per cent of contracts in the oil and gas industry go into the fund, which has netted about $180 million.

    The Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB), Ernest Nwapa, said the board would start a pilot scheme with two or three member-companies of the Petroleum Technology Association of Nigeria (PETAN) on how the fund would be used.

    He also explained that the deployment of fund is structured in such a way that cash would not be given to a beneficiary company, but the board through the fund would guarantee and pay up to 50 percent of the interest accruals on a loan a beneficiary company is seeking from a bank.

    The Chairman of PETAN, Emeka Ene, said the pilot scheme, which would have started much earlier, would take off this month. He said the delay was due to time spent on educating the banks on the unique nature of oil and gas projects and how the fund would be used through the banking system.

    He said: “In case of the pilot scheme, the financing process is much slower than we anticipated simply because the board has been educating the banking system on the unique structure of oil and gas projects and the deployment of the fund.

    “The NCDMB has been partnering with PETAN to see how this can be rolled out. We expect that the pilot will be in place by March. From there, other companies can tap into the Nigerian Content Fund to grow their companies and be able to fund their contracts with lower cost finance.”

    On PETAN’s partnership with NCDMB on the building of industrial parks in the Niger Delta, Ene said: “On the initiative that was announced by the Executive Secretary, I think it is targeted at the grassroots entrepreneurship and manufacturing. The idea is to make some investments at the grassroots where it matters. For instance, simple nuts and bolts, most of them are imported and the technology for manufacturing nuts and bolts is not rocket science.

    “Therefore, by going to the grassroots and creating these industrial parks, the idea is to create the enabling environments where these equipment and services would readily available and affordable for the industry.

     

     

     

     

     

     

     

     

     

     

     

  • Omatek boss tasks FG on local content

    Omatek boss tasks FG on local content

    The Chief Executive Officer of Omatek Ventures Plc, Mrs Florence Seriki, has said that unless the federal and state governments lay good examples by patronising locally made products, Nigerians will not take the government seriously.

    The Omatek boss said for the local industries to grow, government at all levels must lead by examples and stopping patronising foreign goods. She added that Nigerians must also shun the rush for foreign products as the locally made goods are of the same quality with those made abroad.

    “Unless the president and other government officials put their trust in local products by patronizing them, Nigerians will not take them serious,” she said.

    The ICT boss added that the company is poised to produce quality computers and other technology products and urged Nigerians to trust local manufacturers. She also advised President Jonathan to do more for the ICT Industry by providing funds for researches to be made.

    It would be recalled that the federal government recently announced plans to ban foreign computers and technology products in public institutions and schools to encourage patronage of “Made-in-Nigeria” and foster growth in the local ICT industry.

    She equally advised Mrs Omobola Johnson, Minister of Communication Technology, to be proactive by ensuring that all ICT products that are used in the ministry are locally made as this will not only take the sector to its next level but create unprecedented employment opportunities for the teeming youths of this country.

  • Nigerian Content Fund gets $100m from oil firms

    Nigerian Content Fund gets $100m from oil firms

    •Onne Port $2b Phase 4 jetty ready in 2014

     

    Oil companies have already contributed about $100 million towards the

    Nigerian Content Support Fund (NCSF) to be launched in October. The fund represents one per cent of oil firms’ profit.

    Speaking at the Nigeria oil and gas Trade and Investment Forum, in Onne, Rivers State, the Executive Secretary, Nigerian Content Development and Monitoring Board ( NCDMB), Ernest Nwapa, said: “The designated accounts for NCDF and procedure for payment of one per cent sum has been set up. The structure for NCDF has been developed and approval secured for award to Financial Advisors.

    “The new fund would be used as a pool to attract and facilitate venture capital. Professionals will run the NCDF, which closes all the identified gaps in the old fund.”

    Nwapa said the structure of the new arrangement would insulate the operations of the fund from the NCDMB, but added that the board still has overall responsibility for the fund.

    He said industry cooperation would be required to succeed in using funds for targeted capacity, and attributed the growth of the Nigerian Content from five per cent in 2004 to 35 per cent in 2010.

    The implementation of the provisions of the Act, which was signed into law by President Goodluck Jonathan on April 22, 2010, is envisaged to ensure the retention of about $40 billion in the Nigerian economy within the next four years at an average of $10 billion yearly.

    According to statistics, the Nigerian economy currently retains only $4 billion out of the yearly oil and gas expenditure, estimated at $20 billion.

    The new legislation also has a capacity to create over 30,000 direct employment and training opportunities; as well as enhance the establishment of three to four new pipe mills to service the demands of the industry and develop one or two dockyards.

    Also, the $2billion Phase 4 jetty under construction in Onne Oil and Gas Free Zone, Port Harcourt, would be completed in 2014,.

    The Head, Commercial, Intels Nigeria Limited, Iuri Tarmulus, who stated this during a tour of Onne Port, last week, said over 30 million cubic meters of sandfilling has been done, while about $500m has been invested.

     

  • Adopting India’s IT model to boost local content

    Adopting India’s IT model to boost local content

    Worried by foreign domination, local firms have launched a campaign to take over the ICT market by learning from countries with a robust and strong industry, writes AKINOLA AJIBADE

    For stakeholders, there is only one way to boost local participation in the information communication technology (ICT) industry and that is by learning from other countries with a strong industry. The stakeholders are seeking increase in local expertise, transfer of knowledge, software development, patronage of ICT products, among other issues that would engender growth in the industry.

    Some of the stakeholders, such as Ministry of Communication Technology, the National Information Technology Development Agency (NITDA), Nigerian Communication Commission (NCC), Information Technology Association of Nigeria (ITAN), Internet Services Providers of Nigeria (ISPN), Nigerian Computer Society (NCS), Computers Professionals Council (CPN), Association of Telecom Operators of Nigeria (ATCON) and Association of Licensed Telecom Operators of Nigeria (ALTCON) argue that there are capable local firms that can run the industry better than foreigners.

    The bodies had at several fora called for stronger local content policies to help drive the sector, stressing the need to develop the huge potentials in the industry, and further make it one of the best globally. Leading the initiative was the Ministry of Communication Technology. Since its establishment one year ago, the ministry has introduced a number of far reaching measures to promote local content. Under the leadership of Mrs Omobola Johnson, the ministry has rolled out a local content agenda to ensure wider participation of more Nigerian companies in the industry. The agenda is anchored on five goals namely – promoting local software and services, production of devices, card manufacturing, ICT infrastructure inputs and skills development.

    Of note is capacity development, an issue that is gaining ground among the stakeholders. They believe the country must have a strong workforce to be able to drive the local content policy. They said an improved, efficient, and reliable workforce is necessary, if Nigeria wants to achieve its local content objectives. Proponents of these arguments said United States, Britain, Germany, China, India among other countries were able to record huge successes in the area of ICT through local initiatives, arguing that Nigeria cannot be an exemption.

    They said the ICT sector is growing faster in Nigeria, and that the country needs to learn from countries that have grown their ICT industry to an enviable height. Little wonder that the Nigerian ICT’s operators initiated exchange programmes with their colleagues in other countries abroad. Recently, the information Technology Association of Nigeria and the National Association of Computer and Software Companies of India (NASSCOM) organised a conference in Lagos.

    The theme of the conference was: “Empowering and Resuscitating Local IT Entrepreneurs via Local Content Development and Funding.” The forum attracted delegates from Nigeria and India. It also provided room for cross-fertilisation of ideas among the operators. A major objective of the conference was to enable Nigerian operators learn from their Indian counterparts, and seek ways of replicating the knowledge in the industry.

    The reason is because India has recorded tremendous growth in the area of information communication and technology. The country is not only outsourcing ICT services to United States, but also deriving huge revenues from the industry. Reports have it that the bulk of contributions to India’s Gross Domestic Product (GDP) comes from ICT industry.

    Speaking at the event, the President, Association of Telecom Operators of Nigeria, Mr Lanre Ajayi said India has been growing its ICT industry well, and therefore needs to assist the country in this regard. Ajayi said India has advanced greatly in the area of information communication and technology, arguing that the country has become a force to reckon with globally. He said India is one of the leading nations in the area of development of ICT’s infrastructure, arguing that Nigeria need to learn from the country.

    He said: “What we are doing today is to learn from our India counterparts and further improve capacity. The Local content policy cannot achieve its objectives, unless we develop local capacity. The only way to achieve this, is to learn from India, among other countries that have a well developed ICT’s industry. India’s achievements can be attributed to its citizens in Diaspora. Britain granted independence to India several decades ago. After independence, many Indians stayed back in Britain. These people have helped in transferring knowledge to India to grow the country’s ICT industry. Today, India has become one of the best ICT’s countries.

    “Nigeria would have achieved a lot in the area of ICT if its citizens in Diaspora have taken after the Indians. Since Nigerians in Diaspora have refused to come home and impact necessary ICT knowledge on us, we have to learn from a country like India that has recorded a robust growth in ICT. What I know is that one must learn from those that are superior to him. And that is what we are doing to spur growth in the industry. We believe that the idea will help in promoting the growth of local content agenda in the future.”

    Also, the President, ITAN, Mrs Florence Seriki said the issue of local content development is important because it would create jobs and revenue for the economy. She said there are lots to learn from countries that have carved a niche for themselves in the global’s ICT market, arguing that the collaboration between Nigeria and India would further grow the industry. She said operators are encouraging students to use locally manufactured computers, laptops, and Personal Computers (PCs), adding that the development has paid off. She said through the partnership, the two countries would be able to transfer skills that would strengthen the growth of the sector.

    The President, National Association of Computers and Software Companies of India, Mr Som Mital said the two countries would learn from each other and collaborate on the issue of investing in Nigeria. Mital said efforts would be made to forge lasting partnership arrangements between the two countries in the area of ICT development. He said investments in ICT industry in India is worth $300 billion, adding that the country has generated huge revenues from IT outsourcing services.

    “India boasts of a larger percentage of ICT’s market globally. The development has created a lot of value chains in India, and other countries where we have considerable influence. Through this collaboration, India and Nigeria will benefit from each other. With time, Nigeria will declare ICT as the biggest employer of labour. What the country needs to do is to open up its ICT’s industry for growth. The reason is because it can create capabilities, and further make the government to be more transparent. Mital said the two countries would benefit from each other, arguing that Nigeria would gain more in the area of capacity building.

    The Minister of Communication Technology, Mrs Johnson Omobola said efforts would be geared towards policies that encourage the patronage of locally developed software. Represented by her personal assistant, Mr Ola Ogunleye, Omobola said the government would continue to promote the establishment of ICT incubation centres that operate in a private sector/ entrepreneurial setting.

    “Included in this initiative is the promotion of a venture capital fund that would provide alternative and more appropriate means of funding for software and other ICT entrepreneurs especially in the start-up phases, as well as providing avenues for the commissioning of bespoke software by the business community. Government has directed that computers and laptops of a certain configuration purchased through appropriated funds must be locally assembled or manufactured in Nigeria. Likewise, local card production and consumption has been institutionalised to drive local content policy. For example, government insistence on local manufacturing of recharge cards has been successfully done and jobs and values have been created,” she said.

    The minister said appropriate guidelines and standards for IT products/ services, as well as campaign for the patronage of “Made in Nigeria” products have been launched. She said the ministry is working on providing regulatory framework that will protect intellectual property rights and privilege of the local entrepreneurs. She stressed that entrepreneurs would enjoy incentives such as tax-breaks, tariffs/levies concessions. The minister said the collaboration between ITAN and NASSCOM would encourage the growth of the ICT industry in India and Nigeria respectively.