"The Lagos State Governor, Akinwumi Ambode, can do with (that) wisdom as he lusts after foreigners bringing their businesses to Nigeria. Recently, when he met officials of the retail chain, Walmart, he expressed such unrestrained enthusiasm about their berthing in Nigeria and the potential for jobs they would generate for the economy. Walmart is not a charity organisation, why should it care about Nigeria’s employment figures? Walmart’s advent in Lagos cannot be sheer altruism. . "
The misgivings expressed here is on correct grounds. However one of the jobs of every right thinking government is to channel the "greed" and extreme capitalistic propensity of each and every multinational towards serving the national interest. Are we up to the task?
Milk and yogurt, that would otherwise be wasted (or perhaps not even produced), are now available to grace supermarket shelves in Lagos and Abuja. We have Friesland WAMCO and the so-called white Zimbabwe farmers of Kwarra State to thank for that.
Whether it is through Dole, Del-Monte, Transcorp or Walmart, the same situation is about to evolve in the area of fruit juices. There is more to come. Fresh all season corn on the cob, avocados, mangoes, oranges and papaya.
For example, without surrendering to say rice smugglers, Nigeria still needs to lean on organisations that know what they want to do, based on track record. Right now we are leaning on Olam and others for rice. These companies must however be ready or be made to share the benefits. We must sharpen our negotiating skills. To keep them honest, we must keep some competition in the game. Best practices are not learnt overnight, especially in our dog-eat-dog business environment.
Having said that, I can now aver that the berthing of Walmart and similar organisations in Nigeria can and should be a good thing. Nigerian companies are pretty advanced in merchandising, both retail and online and also in logistics. However applying that to perishable agricultural products is a whole new ballgame. Inadequate electrical power supply has rendered the vital cold chain a most unreliable link in the many vast enterprises that the nation must rely on for increased productivity and hence growth. Add bad roads and the nonexistent railway network and you have a situation akin to middle China in the 1940s during the Japanese invasion. That is how bad I read the Nigerian situation.
One writer recently took the trouble to explain how a broiler chicken bred in Sokoto and sold for N300 apiece to wholesalers gets resold at Lagos at N1,600. The reason was quite simple. The losses are routinely in the region of 60-70%. And we are not talking about bird-flu.
India is a country that, despite wide spread endemic poverty, is still much more advanced than Nigeria on all fronts. Even before the new Prime Minister Nahendra Modi took office, the nation was involved in serious soul-searching in the matter of allowing the Walmarts of this world set up shop there. The merchant class were understandably up in arms, while pro-growth analysts harped on the same arguments that I have tried to deliver above.
Let me draw attention again to this statement by Ms Adelakun: "Recently, when he (Gov Ambode) met officials of the retail chain, Walmart, he expressed such unrestrained enthusiasm about their berthing in Nigeria and the potential for jobs they would generate for the economy. . etc"
Fortunately or unfortunately, that is the way such business is initiated. Investors must be made to feel welcome. Even in the US, counties will tempt investors with various sweetners and local tax holidays. At this very moment, New York state has introduced a 10 year tax holiday scheme for new investments covering most of the state. Other examples abound.
It would be instructive to find out from those who should know, (and that includes Nigeria's ambassadors), how Alhaji Aliko Dangote is received when he lands in most African capitals. I can easily visualize the fawning. What with the decades-long benign neglect by both the Blue Circle and the Lafarge groups. That's the power of capital for you. That does not mean that we have to hand over the family heirlooms just because foreign investors express an intention to invest in our economy.
Nigeria is still in the very easy stages of engaging the megabusinesses and conglomerates with whom we must do business to sustain the 5 to 10% growth rate that we so much desire and covet. I have written extensively in the past on power, gas development, coal mining and the mining industry in general.
The truth is that we have not really started. When we do start, there is no way BHP-Billiton, Rio-Tinto, Anglo-Gold Ashanti, Vale, Newport etc will not be involved. One should also add to this list Glencore (Trafigura) who have to date only shown interest in trading in our underpriced crude oil and selling us refined petroleum products that we normally shouldn't import. With the sad economic developments of the past few weeks, these mining behemoths seem to have bitten more than they can chew, for now. We still have no choice but to cultivate them.
Kellog Brown & Root, Fluor and Bechtel will have to get on board in engineering and construction to join the Japanese and Koreans. The incestuous relationship we have had all these years with the Bilfinger-Berger group is definitely not sustainable.
For our railways Bombardier, Alstom and the Chinese must be seen competing for transport infrastructure projects.
A big and fast growing economy requires big investors with access to huge capital. We are in for a very long and turbulent ride with all sorts of sharks in order to move Nigeria forward. Does the government have the requisite legal manpower that can pilot the nation through the legal minefields we must necessarily cross in the course of the negotiations? Unfortunately the track record so far does not offer any basis for confidence. But we must move on.
One should therefore note that the "teeny-weeny" $1b investment that General Electric has put down in Nigeria is, to use the local expression, "cikiny moni," - chicken change. What in a country where, rightly or wrongly, a single individual is routinely accused of pilfering $5b!
To keep Nigeria on the desirable growth trajectory, we may often have to stoop to conquer, whilst still not losing our heads in the process.
To conclude I wish to paraphrase a statement by Dr Pat Utomi at an event hosted by the Indigenous Quoted Group of the Nigerian Stock Exchange some 20 years ago. In his paper he had lamented the "inexplicable mixture of timidity and brashness" exhibited by our public officials while dealing with foreigners. Striking a proper balance is essentially what Ms Adelakun should be asking for.
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