The Nation Newspaper

Tag: Development

  • Before Oil Runs Dry: Options For The Development Of The South-West Of Nigeria

    Before Oil Runs Dry: Options For The Development Of The South-West Of Nigeria

    The Case for Restructuring the Political Economy

    Our incipient economic crisis triggered by declining oil revenues calls into question our entire governance model and political economy which revolves round the distribution  of oil rents. The elite consensus and the political architecture that have informed how Nigeria works (or does not work as the case may be) have long been overdue for review. The current crisis offers us an opportunity to do just that and to restart the stalled conversation about the necessity of a truly productive federal order and create a new template for organizing the republic. In order to begin this conversation from the proper point, we must entertain a brief historical excursion that examines how we got to where we are.

    During the First Republic, regional federalism was the order of the day. Nigeria was divided into three (then subsequently four) regions each with a great degree of autonomy to organize their affairs as they saw fit. The regions enjoyed fiscal autonomy, constructing their social economies based on the taxation of the economic activities carried out within their territories. They had control over the nature and forms of their development and how they could explore latent and evident potentials in their environment to maximize on the most effective ways to deliver the goods of governance to their people.

    The regions had their own constitutions, had total control over and regulated issues relating to education, agriculture, healthcare, taxation, and other significant aspects of their existence. Yet they subscribed to a central authority that held the exclusive right to make decisions pertaining to defence and a few other select issues. The regions were in charge of the resources that they generated, could develop at their own pace and according to the manner that they deemed fit, while contributing a percentage of their revenue towards the keeping of the centre afloat.

    A new order commenced in 1966 with the first military intervention that terminated the First Republic. Under the military, governance was centralized, the regions were abolished and their tax-based social economies along with them. What emerged then was a militaristic-unitary state built atop the ruins of the old regional federalism and a new economy based on the proceeds of selling crude oil on the world market. Where regional authorities had previously harnessed their internal resources and the energies of their people to propel development, there arose a federal military government which shared the revenues from crude oil sales to states which were now administered not as autonomous federating units but as subsidiary and subordinate departments.  The primacy of the federal government would be decisively established over the course of decades to the extent that local and regional autonomy became virtually politically incorrect.

    Provoked by the internecine anarchy and violent political conflict that characterized the First Republic’s last days, the military resolved no federating unit should ever be strong enough to threaten national unity. Accordingly, the military literally dismantled most of the First Republic’s federal structures and adopted a new revenue allocation formula. The power to manage all natural resource (oil, gas, solid minerals) was vested exclusively in the Federal Government. Rights over revenues changed. The regions were divided into states which became the new allocative units for sharing the nation’s wealth. Consequently, the more ‘states’ any group could get, the higher their collective ‘share’ of the national cake. The fiscal viability of the states themselves was not an issue. The verdict confronting now confronting us is that this form of oil-dependent unitarism has reached its expiry date.

    Today, we are faced with the crippling limitations of our “feeding bottle federalism.” An obscure and remote federal authority cannot purport to provide these benefits for all the population. It simply lacks the capacity and the reach to do so effectively in a country as heterogeneous and geographically expansive as Nigeria. The scale of demands are simply too great. We cannot manage and address the aspirations and concerns of over 167 million people from Abuja.  This is one of the reasons why developmental efforts authored by the federal government, despite the huge sums committed to them by successive administrations have failed. Real development emanates from the people’s perceptions of their own problems and their willingness to take responsibility for solving them.

    For development policies to work, the people have to take ownership of them and drive their execution. For this to be the case, the development goals have to be generated right at the grassroots by the citizenry and tally with their own needs and aspirations. It is a process that flows from the bottom to the top. The imperative is the restructuring of the Nigerian state in line with the core principles of decentralization – Subsidiarity, Fiscal Federalism and Cooperative Federalism; which provide for governance matters to be handled by the smallest, lowest or least centralized authority capable of addressing the matter effectively. In other words, in the Nigeria of the future, the central government should have a subsidiary function, performing only tasks which cannot be effectively performed at a more immediate or local level. The various levels of government would thus interact cooperatively to solve common problems.

     

    The Necessity of Economic Diversification

    A case can certainly be made that oil wealth has made us lazy and unimaginative given the bountiful resources with which Nigeria is blessed. Consider solid minerals and agriculture, two sectors brimming with potential but which have suffered great neglect because of the obsession with oil. In fact, agriculture is already this country’s biggest employer and could become even more significant if more effort is devoted to it. It could help address the problem of unemployment. Solid minerals are equally largely untouched.

    However, the biggest resource we have is demographic. We have a youthful working age population that needs to have their energies unleashed. The challenge is to take this population and turn it into human capital to drive development. Zero-natural resource economies such as Japan have been able to successfully harness their human capital with great economic advancement to show for it. Already, the informal sectors as well as youth-led economic sectors such as Nollywood have proven that the Nigerian youth need little incentive from government to thrive. We can all therefore imagine what a functional power sector can do in stimulating creativity and industry at the grassroots. The successful reform of the power sector holds the key to unlocking the potential inherent in our country’s youth bulge. On the other hand, our failure to direct the energies of our teeming youth appropriately would keep them undermined and vulnerable to the inducement of being used as fodder in the cannon of fundamentalists who seek to destabilize our great country.

    No country can prosper by being a net exporter of natural resources. Nigeria, like all mono-resource export economies is extremely vulnerable to fluctuations in world commodity prices. However wealthy oil has made us now, we must understand that it is a finite resource. Its exploitation for sale is a primary economic activity that is subject to the laws of diminishing returns because natural resources are exhaustible or can be rendered irrelevant by innovation. Manufacturing is the key. We have to resuscitate our industries. The path of growth lies with value-added economic activities of manufacturing.

     

    Diversity and Decentralization as two Sides of the Same Coin

    The need to diversify our economy and the necessity of decentralizing the governance are coterminous imperatives. Indeed, one cannot occur without the other. We cannot diversify the economy without decentralizing governance. In the emergent post-oil-centered dispensation, a regime of fiscal federalism which devolves economic power to states and municipalities is now imperative. States have to depend on internally sourced revenue and taxable productive endeavour as against federal largesse. We must see that our prime economic resource is neither oil nor solid minerals but human capital – productive citizens whose entrepreneurial endeavours create wealth and whose taxes fund governance. The principal task of the government is to create an enabling environment that permits citizens to actualize their economic and entrepreneurial potential.

    Thus, fiscal federalism incentivizes smart governance because unlike the current order in which state governors are judged by their ability to distribute patronage, a new order which offers scant resources for patronage immediately levies a demand on local elites to supply the developmental deliverables that make life meaningful. Fiscal federalism, by its very nature, incentivizes productivity and de-emphasizes patronage. By the same token, a tax-paying citizenry whose hard earned funds oil the machinery of public administration will necessarily motivated to adequately interrogate that administration, to ascertain how their taxes are being spent and to hold politicians accountable. In sum, economic diversification and political decentralization will have the effect of strengthening our democracy.

    Since 1999, it has become increasingly clear that a number of our national developmental objectives now fall within the purview of states rather than the federal government. What we need now is for this recognition to become institutionalized through the devolution of powers and resources from the centre. As states are unshackled from federal control, they will become freer to engage in regional and inter-state collaborations to meet the scale of the demand on the ground.

    We may not be able to re-establish the regional architecture of the First Republic today. State governments and local governments as presently constituted have existed long enough to have developed institutional and political lives of their own. Abolishing or reconfiguring them in order to recreate the regional dynamic of the First Republic will be politically onerous. But this does not mean that we cannot create forms of regional cooperation among political leaders, civil society actors and stakeholders to chart a path forward. Moreover, a confluence of economic, social and political pressures may make the transition towards regionalization a fait accompli. Economically unviable states will cease to exist by merging with others to form new regions and consequently regional hubs that will multiply the economy’s centres of gravity.

     

  • New council chief promises infrastructural development

    The newly appointed Executive Secretary of Agbado/Oke-Odo Local Council Development Area of Lagos State, Hon David Famuyiwa has promised to promote infrastructure and community development initiatives that would uplift the lives of residents.

    At the swearing in of the members of the transition committee of the council area on Tuesday, Famuyiwa asked for the cooperation of all stakeholders and residents of Agbado/Oke-Odo LCDA for efficient delivery of services.

    “On behalf of my committee, members and leaders of our great party, I want to express my gratitude for the warm reception accorded us by our colleagues in the civil service led by the Council Manager, Mrs Mayowa Ikuforiji, who has held forte since the tenure of the last administration expired.

    “The rehabilitation of two critical link roads; Ajakaiye and Idowu Adeniji streets carried out under the watch of Mrs Ikuforiji is a testimony of the council’s capacity to deliver services when properly mobilized.

    In her remarks, Mrs Ikuforiji said: “I thank God that with the limited resources at our disposal, we have been able to make impact on the lives of the residents.I want to assure the new leadership of this council area that we shall work together as a team in order to achieve success.”

  • Fayose, NFF endorse ‘Walk for Youths Development Through Sport’

    Fayose, NFF endorse ‘Walk for Youths Development Through Sport’

    Ekiti State governor, Peter Ayodele Fayose, and NFF Assistant Director (Technical), Siji Lagunju, and notable sports philanthropists in Ekiti State were some of the personalities who have lauded the efforts of the Fountain Youths Sports Club at promoting healthy living in the state.

    The declaration came at the ‘Walk for Youths Development Through Sports’ programme marking the fourth year anniversary of FYSC, when Fayose and General Manager Ekiti State Sports Council, Bejanmin Adewunmi, led thousands of others on a road walk at the weekend.

    The ‘Walk for Youths Development Through Sports’  was designed to create awareness and sensitise the populace and the government about the importance of sports in youths development.

    Also on hand to witness the exercise were former NFF board member, Taiwo Odebunmi, Oluwole Oloworemo (Ag. Chairman Ekiti FA), Ganiyu Mustapha Owolabi, Engineer Femi Fateru, former IICC star, Pastor Segun Adelakun, among many other dignitaries.

    Governor Fayose, while reminding the people of the need for regular exercise, said all members of the society should, on a weekly basis, take road walks, noting that the promotion of healthy living is for the generality of the populace.

    Ayodeji Desmond Alabi, who represented Fayose, said his government has highmark programmes for youths to be positively engaged and he is poised to reposition sports in Ekiti State.

    “The youths are the future of tomorrow, therefore it is the priority of my administration to empower them and help to fulfil their destiny. Productive engagement like walking is important, athletic culture and sporting activities are veritable tools of engagement for the youth,” Fayose said.

    Coach Lagunju, in his speech, commended FYSC for initiating such a laudable programme, saying he was amazed to see the large turn-out of people taking the five-kilometre walk.

    The NFF topshot said the ‘Walk for Youths Development Through Sports’ is to physically exercise ourselves, and to ensure that we stay healthy. He advised parents to allow their children to be involved actively in sports for Ekiti State to have more talents.

  • IITA votes $2.2m for cassava development

    IITA votes $2.2m for cassava development

    The Support to Agricultural Research and Development of Strategic Crops(SARD-SC) project, funded by the African Development Bank (AFDB) and executed by the International Institute of Tropical Agriculture (IITA), has budgeted $2.2million  for its cassava value chain activities for next year’s  cropping season.

    This was revealed  when the SARD-SC project had its review and planning meeting for cassava crop held  in Bagamoyo, Tanzania. The purpose of the meeting, a statement said,  was to review project achievements this year; develop work plans, budget and procurement plans for next year.

    The review, it said, also provided an opportunity to identify militating factors against increased  cassava productivity of cassava and proffered solutions.

    The meeting which had in attendance a broad spectrum of scientists including agronomists, socio-economists, breeders, plant pathologists and Commodity Specialists, reviewed how the productivity and profitability of cassava can be improved to enhance food security and farmers’ welfare.

    Some of the issues affecting increased productivity of cassava crops identified were: inadequate use of fertilisers and herbicides by farmers which causes degradation of land. This affects its commercialisation and profitability. The other issue, according  to the statement, was the pervasive Cassava Brown Streak Disease (CBSD) affecting crops in some African countries. The viral disease wastes crops, engenders low productivity and discourages farmers from investing in cassava cultivation. Scientists at the meeting discussed various strategies to combat the menace.

    One of them is dissemination of disease-resistant cassava varieties to areas majorly affected by CBSD in any project target countries.

    To increase the productivity of cassava, the scientists’ proffered intercropping cassava with legumes, while extensive discussions were held on the release of bio fortified yellow cassava.

  • Nigeria, justice and development

    At the international level there has been a growing shift in conversation on why justice and respect for rule of lawmust be included in the post-2015 Sustainable Development Goals. Since the Millennium Development Goals were first developed in 2000, over the last 14 years, it has dawnedupondevelopment partners and other relevant stakeholders that both justice and rule of law underpin not only security, but sustainable economic development as well. As the MDG’s are coming to an end next year, we must look more seriously at why including justice in the Post 2015 Development Agenda is vital. For a country like Nigeria – Africa’s “economic powerhouse”-this move would represent a valuable step forward for justice, security, the economy and gender rights as a whole. But first it is important to take a look at the current state of affairs in the country, then see why the setting of new benchmarks with the Sustainable Development Goals could help improve the overall state of affairs in Nigeria.

    Nigeria’s criminal justice system

    The criminal justice system in Nigeria today is one where ordinary people are not sure what justice holds for them, courtrooms and prisons are dilapidated and a vast majority of those in prison are awaiting trial. The search for justice is costly and often times not even worth the effort. With low manpower and poorly trained personnel in the judiciary and justice ministries, both civil and criminal cases suffer long adjournments. Most times, litigants abandon their claims due to high costs occasioned by protracted period of litigation. The slow pace at which reform is being carried out in the criminal justice system ostensibly keeps access to justice far from the reach of the poor and downtrodden.

     

    Police force mistrust

    Justice and security are interlinked and inseparable, andin Nigeria both are deeply ailing. There is a perpetual state of tension and anxiety across the nation – one which is exacerbated by the (often) uncontrolled use of state power, justice that is rarely assured and a police force that lacks public trust.The departmentthat isnormally charged with maintaining law and order, security and safety has lostpublic confidence throughgrowing concerns about the spate of corruption, bad leadership, ineffective or poor supervision and absence of clearly defined goals. For Nigeria’s common man, justice offers little more than an elusive ideal. The result is a society that either condones crimes committed against them or (most often) resorts to extra-legal means to ventilate their claims or grievances. This slow and (sometimes complete absence of) crimes investigation impairs the judiciary’s ability to dispense justice altogether.

     

    Economic consequences

    The heightened atmosphere of insecurity bears negatively on Nigeria’s economy – it discourages potential investors and hinders economic growth. If Nigeria’s vast resources were maximally harnessed in a regime where justice, human rights and rule of law prevailed, the country could reach new heights.

     

    Enhancing the status of Nigerian women

    Moving towardsa post 2015 agenda, it has become increasingly obvious that a strong and deliberate intervention is needed to enhance the social, political and economic status of women in Nigeria. As in many other parts of Africa today, an estimated 70 per cent of those living in abject poverty in Nigeria are women (qualified as living off less than a dollar per day). In the public sphere, the figures are equally skewed – a meager seven percent of women are represented in the public sphere, occupyingpositions in parliament, the judiciary, executive arms of the government and various businesses. The “key problems”for Nigerian women living in a largely patriarchal society, remain unabated and are yet to be effectively addressed. Such problems include incessant domestic violence, rape and cultural barriers that hinder their growth and relevance. In addition to economic factors, the non-flexibility of socially ascribed gender roles further limits women’s access to power, education, training and productive resources. With 16 years of uninterrupted democracy in Nigeria, experience has proven that women can immensely contribute to the country’s socio-economic and political development if liberated from current limiting cultural barriers.

    Access to information

    Historicallypublic governance in Nigeria has been bedeviled by a culture of secrecy, which hassurrounded all levels ofaccess to government information.  For decades, State institutions hardly kept records because of lack of knowledge or their strong desire to maintain secrecy. More so that civil servants were protected by the Official Secrets Act and other laws from disclosing sensitive information.

    Since the Freedom of Information Bill was passed into law in Nigeria, there has been palpable progress in the areas of public accountability and governance. But there is still a real lack of freedom of information, which has undoubtedlyimpaired Nigeria’s democratic process, impacting onits social and economic development. When information is stifled it impedes the possibility of ensuring inclusive participation in the governance process. With well-articulated targets and goals set to increase access to information, Nigeria stands a great chance to reduce corruption to its barest minimum, and enhance public accountability in governance which are the needed precursors for sustainable economic development.

     

    Conclusion

    Access to justice and respect for rule of law in any given society underpins security and ensures a just society. It serves as a bedrock on which all other social, economic and political activities thrive. Over the years, we somewhat ignored this perspective, but when we consider rule of law as a development goal it cannotbe neglected. To ignore justice and rule of law in any development plan in Nigeria is a recipe for failure.

    That said, it is increasingly obvious that Nigeria can no longer sustain its development targets and goals in post 2015 if they are not hinged on justice and rule of law. Nigeria’s post 2015 Development Plan must rest on a foundation of justice, respect for rule of law and human rights, effective security and safety for all. To do otherwise is like building a house of cards.

    The time to set priorities for Post 2015 is here and the opportunity to place justice and rule of law at the heart of Nigeria’s development agenda must not be missed. At the core of Nigeria’s empowerment, stability and development is justice and rule of law. In the next fifteen years, justice and rule of law shouldoccupy a distinct place in any proposed or adopted development agenda. If we exclude justice and rule of law, the consequences of such omission may be too heavy for us to bear. It may be extremely difficult to achieve respect for human dignity – particularly for the vulnerable. The time to act is now!

    •Oziegbe, is Senior Partner with Partnership for Justice, a non-profit organization of professionals who share a commitment to equality, justice and globalization of human rights standards and a consultant with OSIWA.

  • ‘Lack of business development plan bane of SME growth’

    The Small and Medium Enterprise (SME) sector has the capacity to transform Nigeria into a globally competitive economy in the mould of China and other Asian Tigers if operators could come up with viable and robust business development plans, Registrar/Chief Executive Officer (CEO), Institute of Business Development (IBD), Mr. Paul Ikele has said.

    According to him, most SME operators in Nigeria have no direction because of lack of business development plan.

    In an exclusive interview with The Nation, Ikele said: “SMEs need to come up with business development plans. Before a company is incorporated, that company should come out with a business development plan. Before you open an account for a limited liability company you should submit a business development plan so that government will key into it and follow it up. If at any point that business does not achieve its objective, it is quietly withdrawn. By so doing government will be able to identify those people that are performing and those that are not performing.”

    Ikele, a former MD/CEO of Noble Path Finance and Securities Limited and General Manager, Business Development Olympia Insurance Limited,expressed regrets that most people move into the SME sector because they don’t have any other alternative whereas SMEs can assist in turning around the economy.

    “I can assure you that if you are in SME and you know exactly what you are producing, you already have grown a market share in that particular business, you will be able to identify your key customers and focus on servicing them,” he said.

    The Registrar noted that this has not been the case with SME operators in Nigeria where “most SME operators are incompetent personalities, who just want to use it and do other things and because they know how to get to the sources of that fund they get the money and before you know it they channel it to other areas.”

    He pointed out that most people, who are interested in SMEs, are either incompetent or don’t have real intentions in that business. Rather, their intention, he said, is to use that money for other objectives.“This is why the Institute is insisting that every organisation should come out with a business development plan so that it will encourage them to submit at the end of the year the result of the evaluation of their operations,” he said.

    He said before setting up an SME, there is need to engage professionals to draw up the business plan. Also, there is need for an environmental scanning to determine whether that business would survive in that particular area.

  • Emefiele’s move to connect finance to development

    Emefiele’s move to connect finance to development

    It is clear to see that Mr. Godwin Emefiele has demonstrated preparedness for his current position as Governor of Central Bank of Nigeria than what analysts may have acknowledged. During his confirmation-hearing before the Senate, Mr. Emefiele said his regime at the CBN will make banking count for development. Since assumption of office, he has made concrete policy commitments to back his assertion that finance should have strong connections to development. One can safely expect that more actions in this regard will follow in the course of his time in office.

    Mr. Emefiele’s position has long been validated by the International Labour Organisation (ILO) as well as the United Nations at various times and through various pronouncements and declarations. Since 2007, long before the financial and economic crisis, the ILO has maintained its positionregarding the role of central banks in controlling inflation and promoting job creation. The point is, despite precarious levels of unemployment and underemployment in the developing world, many central banks in those regions have not seriously considered employment creation as part of their mandate. Instead, they have narrowly interpreted monetary policy to mean just stemming the tide of inflation through inflation-targeting and price stabilisation.

    As has been established by development experts, it is now trite for central banks to limit monetary policy solely to price stabilization. This is notwithstanding the fact that this alone cannot guarantee that economic growth will improve since low inflation does not necessarily lead to a high income and a stable economy. Nor does a high rate of economic growth necessarily lead to a high rate of employment creation. This is especially the case in Nigeria where we have witnessed impressive GDP growth rates over the past seven years without a corresponding reduction in the unemployment rate, which rose to 23.9 per cent in 2012 relative to 13.9 per cent in 2000.

    Indeed, in his presentation at his maiden press briefing, “Entrenching Macroeconomic Stability and Engendering Economic Development in Nigeria,” Mr. Emefiele disagreed with the dominant school of thought that sees the role of central banking as being limited to achieving low inflation as a policy strategy for growth, increase in employment, and poverty reduction. He audaciously stated that the CBN under his leadership would also begin to include the unemployment rate as one of the key variables considered for its Monetary Policy decisions.

    To truly create a ‘people-oriented Central Bank’ as envisaged by the Governor, the issue of access to finance by Micro, Small and Medium-scale Enterprises (MSME) needs to be quickly addressed. The weak connection between banking and development in Nigeria is expressed in the remarkably low access to financing by the MSMEs; difficulties in accessing financing by women entrepreneurs; paucity of long-term funding for real sector operators; high cost of credit across the business spectrum, owing to prohibitive interest rates; general low banking penetration; and weak grassroots banking due to very limited success of microfinance banks. Without a doubt, these issues are impediments to economic growth and development. MSMEs are generally regarded as drivers of innovation. They are also reckoned as the engine of economic growth across developing and advanced economies. In China’s vibrant economy, SMEs account for 99.9% of total number of firms, and they provide 84% of total employment (World Bank, 2013). Inadequate funding for this sector in Nigeria has long been diagnosed as an impediment to innovation, employment generation and economic growth.

    Another frontier of growth is women entrepreneurship. Empirical data has shown that women are increasingly getting involved in business formation. This global trend has gained even more momentum in developing countries where women, from time, have been known to be very enterprising in the agrarian economy and in trade. But notwithstanding, around the world, women still very much lag behind men in business ownership. Businesses operated by men tend to be more successful. Apart from the myriad of social forces that militate against the success of women entrepreneurs relative to men, lack of access to financing has been somewhat intractable. Primordial prejudices against women have shifted only in some little ways. Thus, disparity in access to financing based on gender is unfavourable to women.

    The funding structure in the economy also calls for interventions in real sector activities. Manufacturers of different stripes turn to Nigerian Export – Import Bank (NEXIM Bank) with the same requirement. They want long-term financing at affordable, or preferably, single-digit interest rates. But the funds to supply credit under these conditions are hardly available in the market. The lending environment is defined by tight monetary stance, which has seen the Monetary Policy Rate remaining at 12% in the past two years, in order to stymie inflationary pressure. In tandem, yields on risk-free government securities are in lower double digits. Moreover, low-cost deposit mobilization by commercial banks remains aspirational due to low level of household savings and low banking penetration. (Only about 25% of the population is banked.)

    As for the microfinance segment, it would be apposite to have the following hypothesis tested. One of the consequences of the rapid pace of urbanization over the years is that renewal of the economically-active population in rural and suburban settings has been impeded. As such, microfinance is being addressed to the urban poor while the rural poor are chronically underserved. But social identification which influenced traditional practice of micro lending and drove positive repayment behaviours is absent in the cities. For that reason, microfinance banks have especially struggled to make significant impact and remain in business.

    This general context to financing in Nigeria has meant that commercial banks are hardly taken to be agents of development. This perception needs to change through the implementation of policies that underpin the role of banking in the development process. It is, therefore, appropriate and also commendable that Mr. Emefiele has construed the role of the CBN as making banking particularly relevant to development.  Central banks have policy tools to make this happen. The CBN governor has hinted on his intent to deploy a variety of such tools.

    The MSME Fund

    In August, President Goodluck Jonathan launched the Micro, Small and Medium-scale Enterprises fund. Promoted by Central Bank of Nigeria, the N220 billion fund has become the first concrete step under the regime of Mr. Godwin Emefiele to deliver on his promise that the CBN will be an agent of development. The MSME fund spared none of the issues that have been enumerated above. While the size of the Fund means that it will not meet all the needs; it can provide the basis for scaling up the interventions in one form or another.

    The MSME sector comprises an estimated half a million operators. Operators in the sector collectively account for about 50% of Nigeria’s GDP, according to the Minister of Commerce, Trade and Investment, Mr. Olusegun Aganga. However, only 8% of the MSMEs in Nigeria are reckoned to have access to financing. This underscores the importance of this Fund which will lend at single-digit interest rate. With significant funding, it is imaginable that, like the data from China, MSMEs in Nigeria can contribute over 90% of the GDP.

    The MSME Fund is not necessarily a novel idea in Nigeria. There have been similar initiatives in the past, which achieved little success. But here is a situation where past failures should not be a hindrance to new efforts. The stakes are higher now for the success of the MSME sector. Because of the large number of the firms, they not only constitute the engine of growth for the economy, they will also create millions of jobs and therefore alleviate poverty. To put this in context, it has been acknowledged that micro, small and medium scale enterprises tend to employ the poor including those without formal qualifications; and the enterprises are usually the only hope of employment in rural communities. Even so, most poor and unskilled people only get by through self-employment.

    It is no surprise the CBN governor has worked really hard to launch the MSME fund with presidential backing and as quickly as he did. He has restated time and again his determination to link Nigeria’s economic growth to job creation. Around the world and in the country, policymakers are weary of “jobless growth” because of high unemployment rates. Instead, they are pressing for inclusive, job-oriented economic growth models. Global employment rates have raised concerns, but not merely because employment has again played the role of the laggard in recovering from the last economic downturn. Unemployment is also associated with social risks, and a move towards full employment is critical for inclusiveness and shared prosperity.

    By design, 60% of the MSME Fund is allocated to women entrepreneurs. This is good news for gender advocates and those who care about inclusivity. The fund is a necessary boost for women entrepreneurship. I agree completely that women are the new frontier for finance. The women folk have long been deprived of access to credit. Whereas women are adept at business formation, mostly in order to improve the living conditions of their family, they are less successful in business. Their greater dedication to family life poses a limit to their business success. But beyond this, lack of collateral, often based on gender discrimination especially in land and property ownership, has meant that women have lesser access to financing for their businesses. However, women are proven to be better money managers. Their success is also known to have more impact on the family than when men are the bread winners. This, therefore, means that women can make more contributions to development if they are empowered with financial access.

    Working through the DFIs

    The decision of the CBN governor to work with development finance institutions is of particular interest to NEXIM Bank, and Nigerian exporters in the non-oil sectors. Although the development finance segment of the Nigerian finance industry is in the early stage of transformation, the DFIs have garnered some experience to help deliver development outcomes in their areas of focus.  NEXIM has been working with SMEs in our sectors of focus — Manufacturing, Agro-processing, Solid minerals and Service – under what we call the MASS Agenda.  Our interest has been to help nurture indigenous businesses in the MSME sector to become global players, by financing their production and export capabilities. From our experience, the “MASS” sectors are in the frontline of employment generation, and they are mostly characterized by low barriers for new entrants. This means that interventions in these sectors can quickly scale up.

    It is very heartening to note that President Goodluck Jonathan has been an ardent supporter of the DFI community in Nigeria. This undoubtedly will translate to fiscal support for the agenda of the CBN Governor for intervention in the quest for development in the country. We saw this in the housing sector with the launch of Nigerian Mortgage Refinance Company earlier in January. As already noted, the MSME programme received presidential attention, with Mr. President being physically present at the launch of the fund. Also, the Coordinating Minister for the Economy and Finance Minister, Dr. Ngozi Okonjo-Iweala has already hinted last June, at the dinner organised by the African Development Bank (AFDB) to flag-off events marking its 50th anniversary that the Federal Government was fine-tuning plans to establish a Nigerian Development Bank in 2015. This is in addition to other programmes by the Administration that will restructure and strengthen development finance institutions in Nigeria to enable them scale up results and close the gaps in development financing. NEXIM Bank is very enthusiastic on these brighter prospects.

    – Moghalu is Head of Corporate Communication, Nigerian Export-Import Bank (NEXIM)

  • ‘Social media a boost to SMEs development’

    ‘Social media a boost to SMEs development’

    In this age and time, we are expected to process information in the super highway, at the speed of lightening. Of course, this information revolution is being accentuated by the social media. Curiously, everybody has caught the bug from individuals, corporate bodies, entrepreneurs, name it.

    Taking into account the history of instant messaging, even the blind and deaf can rightly point out the evolution that has swept this technology space. The days of yahoo messenger and any other IM of that time, albeit still around, are clearly phased out with social media apps that are more engaging, more personal and definitely interesting.

    One company that has since recognised the endless possibilities of the social media in terms of its sphere of influence among others is Afmobil Group.

    The company which set up shop in 2009 has a soar away brand, the famous Palmchat, which is an app for social network on the web.

    The current reach of Palmchat across the country is an average of five million users in Nigeria alone and over 39 million users worldwide.

    With over 80,000 new users signing up daily from different mobile devices, Palmchat is fast becoming the choice social mobile platform for users around the world.

    Speaking with The Nation on the potentials of the app for startups, Blessing Joe, who has responsibility for the company’s Brand Management, said there is immense potential for small businesses with Palmchat.

    “As a startup, the social media is a veritable tool for networking generally, especially with little or no cost,” Joe began.

    Speaking further, he said: “You can stay really social on Palmchat even with as little as 30MB data using the Palmchat voice messaging function. Just hold down the ‘Voice’ button, record your message following the prompt and send your voice recording to your friend or group of friends using the broadcast function.

    “You can also share your cool pictures, music and recordings with your friends, getting in touch with them in private messaging. Yep, clever incentives are good motivators and in this age of social media frenzy; with loads of social platforms literally sprouting out from nowhere, cool incentives play a key role in building that reason-why-I-love-this-platform kind of loyalty.”

    Palmchat, Joe stressed, “Is an amazing innovative mobile social app that is compactable with all mobile operating system, and downloadable from all mobile app stores:  Java, Windows store, Apple store, Google play, Blackberry world-among others. It has interactive and fun custom features: Shake-Shake and Look around with other functional capabilities like the file share, instant messaging and voice recording.

    “Palmchat is a unique instant messenger which is targeted at the Nigerian youths. With its unique interface, trendy and hilarious smileys and emoticons, engaging chatrooms, Palmchat is indeed the “happening instant messaging.”

    “One of the most exciting unique things about Palmchat is the “shake shake “feature. Now all you have to do to find friends around is shake your phone to select who thrills your fancy and get chatting.”

    Expatiating, Joe further revealed that the company has a working partnership and brand affiliation with Tecno Nigeria and Techno International, which enables perfect user interface for potential customers with smart phones.

    With its wide reach, startups are assured of improved social networking at a pocket-friendly cost unlike other product offerings out there.

    Palmchat as a social networking app is also a matchmaker of some sorts with happy-ever-after stories been told by users who met online using the Look-Around custom feature to connect with each other on their first date.

    A unique feature of Palmchat is look-around feature that gives the users the power to avoid all the queer chatties and connect with that special one just over your shoulder.

    Citing the story of Mrs. Bimpe Ajayi, a Human Resource Manager with a multinational company in Lagos, who met her hubby, Frederick, on Palmchat, Joe recalled the couple’s love story thus: “It was a very pleasant night; the first night of our honeymoon. Frederick is such a loveable person; he always has something amusing to say, quite an accommodating gentle man and slow to anger. Some people find it hard to believe me when I tell them that I met this amazing man on Palmchat.

    “I didn’t just bump unto him on Palmchat-no. I wanted him, I dreamt of that special one but I just didn’t know how, where and when I will meet him until a friend introduced me to Palmchat,” Joe recounted the lovey-dovey tale of the Ajayis.

    Echoing similar sentiments, Mr. Mounir Boukali, who manages a team of Public Relations specialist, managers and several high level agencies who handle TRANSSION Holdings’ brands, holds the view and very strongly too that social apps like Palmchats have limitless possibilities when it comes to user-engagements.

    According to Boukali, “Now you wish social platforms don’t consume your data all-too-quickly.  You are probably not on Palmchat-yep, you’re not a Palmchatter. On the Palmchat platform you will chat more for less…I mean 30MB data on your mobile device is just good enough.”

    Besides, he said: “Nigerian ladies can join the world of hi-tech beauties on Palmchat; check out whose story is the most inspiring and whose selfie is making the buzz as Nigeria’s premiere beauty contest gets social as well as join the growing community of Palmchatters; sign up on Nigeria’s most trending mobile social platform with over 30000 daily sign ups. Be a Palmchatter.

    “It offers really different features from those we’re already used to. You can choose to join any chat room of your choice, discussing a number of issues, from sports to romance, and even get discounts from online stores. It has become the user friendly interface and custom features usher in a new face of social interaction and bonding.”

  • ‘Creation of more states will bring development’

    Community leaders in Arigidi-Akoko,Ondo State have commended all the delegates to the just-concluded National Conference for recommending additional States in the country including Ose to be carved out of the present Ondo State.

    It would be recalled that the Conference ratified the creation of 18 new states cutting across the six geo-political zones in the country.

    A statement by Arigidi Leaders of Thoughts (ALT), signed by its Acting Chairman, Lawson Owadokun and Secretary, Bola Olutoye hailed the president of the Senate, David Mark for upholding the delegates’ recommendation.

    Besides, the Community leaders praised the indigenes of Akokoland especially the leader of Oodua Peoples Congress (OPC) Otunba Gani Adams, Chief Seinde Arogbofa, Taofik Abdusalam and Mrs Yemi Mahmud Fasominu for their commitment to the ratification of the proposed Ose State.

    The group also appreciated the Southwest Leadership of the Conference particularly Chiefs Olu Falae, Kunle Olajide and others for displaying exemplary behaviour during the Conference.

    It urged Owo and Akoko indigenes to ensure that the proposed State becomes a reality, stressing that the valedictory speech made by President Goodluck Jonathan during the closing ceremony re-affirmed the strong disposition of the President to the supremacy of the rule of law.

    The Community leaders said:”The President’s willingness to work hand in hand with members of the National Assembly to ensure that necessary legal frameworks are perfected to ensure that the outcome of the conference is diligently implemented is a pointer to the fact that the deliberations are not in vain.”

     

  • Youths urge council on development

    The Rubochi Youth Association (RUYA) in Kuje Area Council of the Federal Capital Territory (FCT), has called on the authorities of  the council and the FCT Administration to provide infrastructural facilities for residents of the community.

    In a communiqué jointly signed by the union’s President, Comrade Iyakwo Joseph, Secretary, Comrade Abdullahi  Galadima and Publicity Secretary, Comrade, Ayaje John Bako at the end of the union’s first economic summit held at the community, the youth urged the council to provide potable water, electricity and good road network to link Rubochi-Gombe with neighbouring Gadabuke town.

    They also urged the FCT Administration to intensify efforts in rehabilitating the Kuje-Gwagwalada and Abaji-Rubochi roads, saying it would go a long way in attracting the attention of merchants that will patronise traders at the Rubochi Market, thereby boosting economic activities as well as revenue generation for the council.

    The communiqué also said the council authorities should encourage local farmers to engage in more productive farming activities through the provision of modern farm inputs and implements such as improved seedlings, fertiliser, tractors, harvesters and storage facilities. These will improve food production.

    “The authorities of  Kuje Area Council, under the leadership of  Mr. Shaban Ishaku Tete, should, as matter of urgency, save the neglected Rubochi development secretariat from total collapse by renovating it. Consequently, some departments of the council could relocate to the secretariat for easy of accommodation,” the communiqué said.

    The youth stressed the need for the council chief to designate some days to personally attend to official matters at Rubochi, an action, they said, would enhance administrative activities in the secretariat.

    The union therefore, pledged to collaborate with the council authorities in providing banking services at Rubochi, especially micro-finance bank that would encourage economic activities, even as they assured businessmen and residents of safety of their resources.

    “RUYA is also assuring businessmen and women that it would collaborate with palace chief of Rubochi and government of Kuje Area Council to ensure that all resolutions reached are implemented,” they added.

    In another development, The Chairman of  Kuje Area Council of the Federal Capital Territory (FCT), Hon.Shaban Tete has expressed determination to partner with the National Film and Video Censors Board, in order to eliminate uncensored and unapproved videos from the FCT markets.

    Tete made this commitment when members of executive of the National Film and Video Censors Board visited him in his office to express their gratitude to the council chief for the office space allocated to them.

    According to Tete, for the board to choose Kuje as site for their office was a welcome development, saying the leadership of the council will collaborate with the board in order to sanitise the movie industry. He noted that uncensored immoral movies seen in the markets currently are not capable of teaching good morals to the young ones.

    “We will do what it takes to support your board, so that you will succeed in your endeavour. Our hands are on deck, because we need to control the types of movies that our children watch at home that could negatively affect their behaviours.

    “So, anywhere the council needs to encourage your board, we will do so. Our doors are open to support you so that the movie industry would be properly sanitised,” he said.

    Earlier, Mrs. Patricia Bala, Director-General, National Film and Video Censors Board who expressed gratitude to the chairman for giving them the office space, said the board needed to collaborate with the leadership of the council after setting up the office, to make their fight against uncensored movies successful.

    “We hope to set up a committee with the council and we want the council to nominate a desk office which we would be liaising with to the council. We really need to set up the committee to start working, because we need to sanitise the industry. As it is now, our staff strength cannot cover the whole country.

    “We really need the collaboration of the council, since there are a lot of uncensored movies in the market. We alone cannot cover everything, which is why we need to work with the council. We will be happy if the committee is set up, so that we can kick off immediately. There are too many unwholesome movies in the market and if they are not approved, they will be thrown out,” she said.