Don Ebubeogu is the managing director, Tiger Foods Limited, a fast growing indigenous conglomerate with headquarters in Onitsha Anambra State. He is also the outgoing President, Onitsha Chamber of Commerce, Industry, Mines and Agriculture, ONICCIMA. In this interview, with Daily Sun, the industrialist took time out to review the challenges of doing business in Nigeria and the imminent threat posed by the influx of Chinese products in the Nigerian market. He also reflected on issues affecting businesses not only in Anambra state but also in the entire south east, stressing the need for government to play its role of creating enabling environment for a thriving private sector.
He spoke also on a wide range of economic issues including power, transportation infrastructure and the influx of Chinese products into the Nigerian market.
Challenges posed by erratic power supply to private sector
Do we really have power? People still generate their own power and the bulk of the diesel we buy in this country is to power our generators which is also why generators are still in high demand across the country.
And again, public power supply is not getting cheaper despite the erratic supply because they are increasing tariffs almost every other day.
What advantages are we going to have when we are looking at China, India and those other countries who should be competing with us when they are making their power cheaper and here we are , making our own costlier. I want to say that the Federal Government’s decision to give out DisCos to private individuals was a wrong approach because power is supposed to be in its exclusive list. It should be part of the things to use in regulating industrial growth but when you give it out to people whose interest is simply to make money, you end up messing up the economy and that’s what we are seeing presently. Ordinary prepaid metres, is proving very difficult for them to give to the consumers and people still go to the black market to buy meters to have power. We are yet to get our priorities right in the area of power which is indeed a big issue in the country which was why some stakeholders opposed the African free trade, a noble idea to have free movement of goods among African countries.
But again we must be ready so that agreement so that we don’t disadvantage our industrialists, and the only way to get ready is by making sure that infrastructure are there. and they are competitive so that by the time they produce they can compete favourably with the rest of Africa. Can we be able to do that and in all honesty compete with the rest of Africa? Why are Nigerian companies going to Ghana and with the free trade thing in Africa, what it means is that locating your company in Ghana you have easy access to Nigeria? In Ghana where there is stable power supply, good roads and youths having qualitative education at the end of the day, they will have comparative advantage we don’t have and they will take over our markets. That’s why I said it’s not about signing treaties but it’s about getting your people ready.
Doing business in Onitsha and the South East
Basically, one of the major challenges we are having today is the problem of accessibility, or access to markets. Onitsha became what it is today because it used to be the hub of transportation where the east, south and west including the north converge. It has markets quite alright but those markets thrived because people could access them easily by using road transport. You can connect any part of the country from Onitsha. Today however , market is no longer about roads, you talk about airports and the railways, vessels and badges. These things I mentioned here are lacking in Onitsha and they are affecting business activities in the south east. For instance, the Federal Government is spending huge amount of money on the railway project, but what is coming to Onitsha if one may ask? No one is sure any railway route is coming into Onitsha. What it means is that Onitsha is going to be denied a level playing ground within the Nigerian marketing infrastructure.
What it means is that if it’s going to take a farmer in the North `to transport a basket of tomato through the railway to Lagos maybe at N10 per basket, it’s going to take the same farmer may be N70 to transport the same basket from the North to Onitsha. So it’s going to disadvantage Onitsha based on pricing thus making it uncompetitive.
Looking at the road transport system, we are already cut off. The Onitsha Owerri road is cut off, Enugu Onitsha expressway is in a state of disrepair , Onitsha-Asaba Benin is also terrible and so the question is from where do you connect the rest of Nigeria to this industrial and commercial hub of the South East.
Remember we are no longer talking of ECOWAS free trade, but of African free trade and we ask which African are we talking of? How many African countries can boast of the population in the South East? When you are ignoring this zone where Onitsha is the anchor market and you are talking of African market, are we not being insincere? Talking of African market, Nigeria is a huge market on its own and every African country is looking at buying into the Nigerian market. Have we been able to utilise our numerical strength to sell among ourselves? If it is easier for somebody in Aba to go to Cameroun to buy their pepper and difficult for the same person to go to Nsukka to buy the same pepper, the capital flight can never be stopped. These are the examples of this situation in Onitsha, but government appears to be ignoring all these and focusing on Intra Africa Trade. I think its high time we pause and ponder about what our priorities are indeed.
China opening a consular office in Awka
Well, I read it in the newspapers but the South East business community was not informed. The Chinese came to Awka and had a meeting with the governor and after that they said they were going to site a consulate here. We don’t know anything more about that. As per the Chinese denying Nigerians visas, I think that was a deliberate policy they enacted in order to take away our markets. There is no way you can be denying visas to people who have track record of trading with you over the years. We have records of people who have done business with the Chinese for over ten years with huge turn over but yet they are denied visas to go and see their partners or even see what is being shipped to them. Yet, the same Chinese have their visa without hassles on arrival in Nigeria . What this means is that the Chinese can easily walk into an airport, buy a ticket, walk into Nigeria and collect a visa yet a Nigerian businessman with track record finds it hard to go to China . Something is fishy and that is why you see a lot of Chinese everywhere in Nigeria doing trading in every corner of the country both in bulk and retail business.
Simply put, the Chinese are trying to take away the market from us and nobody is talking. Where are the Immigration and what papers do they have to come into Nigeria to be trading because I know that the laws that makes people to come into Nigeria and do business doesn’t give you the latitude to do retail trading. The question is who is encouraging and allowing them into such businesses when they are denying our people visa.
Reasons Onitsha port is being stalled
The question should go to the Federal Government. Why is that port not functioning after three commissioning ceremonies? Why are you coming to commission a project you have not gazetted? Until you gazette it, it has no legal instrument to work which means that whatever you’ve being doing since was mere political gimmick. But when you gazette it, you concession it and people will come in to run it just like any other business, then you begin to see the economic implications of running the Onitsha port.
Why would somebody in Asaba or Agbor go to Lagos to import when you can route your goods to Onitsha here and collect them. That will give our roads longer stability before they can deteriorate. But because heavy trucks are moving on those roads day in day out, they get bad so often. Jonathan spent about N4 billion just to re-service the machinery at Onitsha port, why wasting all the money? The Shagari administration that sited the project there wasn’t stupid but successive governments have been playing games with the project. Jonathan that spent that huge amount on the project why didn’t he gazette and concession it? These are issues that we need to probe further because if the project takes off fully, it is not going to benefit only the South East alone but all Nigerians.
My achievements at Onitsha Chamber of Commerce in two years
So far so good. I think I will give myself a pass mark because I wasn’t able to do many things I set out to do not because of limited time I had . But the fact that the structures I met on ground were not too fantastic I did my best to improve on the . We didn’t have a system so to say when I assumed office and such needed to be improved upon and I had to devote a lot of time doing that. The Chamber in the way we have repositioned it now is excelling and the business community is having more confidence in its advocacy role.
It is a continuous thing and so I didn’t expect magic from my tenure but I believe that having done much underground, people will see much of the result of what we’ve done in the next two to three years under my successors. The person coming after me is a vibrant person and I have no doubt that he will take it to the height that couldn’t be reached under my tenure. We have put a lot in the place, developing manpower, recruiting capable hands and providing an enabling environment to make sure they have the necessary tools to achieve results. Most importantly, we‘ve been able to gain the confidence of the Onitsha business community.
Chamber’s engagement with relevant authorities on port project
Every successive administration in ONICCIMA has always done seminars and workshops on that port issue. We have never rested because we know the importance and the issue has always occupied the front burner in any of our annual lectures. We often invite the relevant stakeholders both from the Federal, state governments and the business community but everybody keeps asking why is Onitsha River Port not functional. It is only the government that can answer the question. We invite the government to come and tell us why it is not working but the same government will come and ask us same question.
What government should do under the circumstance
They should simply do what governments all over the world do. Nobody is asking government to give them free money or to come and build industries for them. People are ready and willing and are also running their businesses. What they are only asking for is simply for the government to provide the enabling environment including the basic infrastructure.
We are talking about railway, it won’t take government anything big to call the stakeholders and ask them to make inputs in the railway project. Why is the South East being ignored despite all our contributions to national economic growth and industrialisation?
You can’t talk about having railway in Lagos and Kano without talking of Onitsha so let’s just remove politics and do the right thing so that Nigeria will excel.
Empowering state governments to repair Federal roads
I used to ask myself such questions too. Why do I have to wait for the Federal Government to come and do palliative measures on a road that is so important to me such that if that road breaks down, my people will not be able to move around. That is the question we should ask the governors. For instance, this Onitsha –Owerri road, when we started noticing potholes there, these are things even a local government chairman can fix without waiting for the state. Now, it has turned into deep gullies in multiple places that require more money to fix and I don’t see them doing it soon which means we are already in trouble here. Must we wait for Federal Government forever?
How businesses are coping with security challenges
It is a very big challenge and we are going back to the era where the security situation scared away various businesses and it is coming in multiples unlike before where we had only issue of kidnapping. Today it is combined with armed robbery, abduction, farmers’ herders’ crisis and whole lot. Nigeria is seriously challenged and it is no longer what any state governor will come out and say he is able to harness and immured his state from. It is something that the entire governors in Nigeria with the Federal Government should sit down and have a security summit towards finding a lasting solution to the anomaly. Until that is done, security is going to wipe away whatever gain we might claim to have recorded over the years.
Who is to blame in this circumstance, government or the business class?
The government is taking the blame 100 percent. The industrialist cannot provide road, railway and other enabling environment for business to thrive. We have a seaport here which has been politicised for many years and it is not the industrialist that can make the port functional and you know that if the port is functional, it would reduce the cost of transportation of containers both inward and outward ones . Moving a container from Lagos to Onitsha costs above N700, 000 and if the ports are working here, it won’t take more than N100, 000 to move the same container to Lagos. Those are the costs we have to look at if we are talking of helping businesses to grow not just in Onitsha but in Nigeria. We need to look at those bottlenecks and dismantle them one after the other. Why do you have to put Customs on every kilometer of road when the Customs are already at the seaports, airports and the borders? Why are they here disrupting free flow of business when it is clear that by the time you dismantle those bottlenecks, business will simply flow on its own?
Advice to Nigerian business community
My advice to the Nigerian business community is to look beyond buying and selling. The way the economy is going and the world becoming a global community, trading is endangered. I used to talk a lot about the initiatives introduced by Dora Akunyili when she was Director General of NAFDAC. There was a time she sent out a circular saying that some categories of products you only register once after which you would be expected to start producing them from here after some time. What this means is that if you come for the registration of that imported product, it would be registered once with a lifespan of five years and then it is renewed again for another five years making it ten years. After those ten years, you would be expected to start producing such products locally.
That was a novel and noble idea which if it was sustained, the bulk of products people are still importing would have been produced locally by now. It wasn’t sustained and if you look at the situation now, there are so many things being imported into the country today that can be produced locally by now. Technology transfer is easy now, you’ve been importing, you know the market already and sometimes when you visit some of the companies producing those things abroad, the technology they have will be so cheap that you as an average businessman in Africa will be able to afford that. These are the areas we should be looking at and with this African Free Trade Agreement, the ball is in our court to take the lead and dominate the African market. We certainly cannot dominate by importing from China and selling to our neighbours because the Chinese would simply go to our neighbours and block us. The truth is that we should now look beyond trading and embrace manufacturing because manufacturing and agriculture holds the key to Nigeria’s economy economic and industrial development. The two sectors have the potential to liberate our country from economic quagmire.