Nigeria's Minister of Industry, Trade and Investment, Otunba Richard Adeniyi Adebayo

How We Sustained Production of Essential Commodities During Lockdown– Adebayo

The Honourable Minister of Industry, Trade and Investment, Otunba Richard Adeniyi Adebayo, in this interview with The Commerce Africa’s Managing Editor, Yusuf Issa An-Nuphawi, revealed how the Ministry sustained the production and delivery of essential commodities across the country during the economic lockdown occasioned by the COVID-19 pandemic. Excerpt:                                     

TCA: Your Ministry coordinated the stakeholders in the manufacturing value chain to sustain production and delivery of essential consumables during the lockdown of the economy. Would you share your experience?

Adebayo: First, some context is required. As you know, manufacturing activities involve complementary and crucial stages that are each complex in themselves. Keeping all these processes going while also managing distribution during the pandemic, without significant hitches, was a new experience for us. But then we quickly realized that we either mitigate these challenges or the whole production and distribution of those very items needed to combat the Virus would have been totally disrupted. Of course, the consequences are better imagined.

To address all the foreseeable challenges, the ministry immediately inaugurated a committee on Sustainable Production and Distribution of Essential Commodities during Covid-19; with the core mandate of ensuring undisrupted production and delivery of essential commodities. The Committee promptly set up an Emergency Operation Center (EOC) with membership from the Ministry, MAN, NACCIMA, NASME, SON, the Press, and other members of the organized private sector (OPS).

For one, initially we had to deal with the omission of some essential items and services from the approved list, one of which was packaging materials. For example, the cover for PET bottles used in packaging of hand sanitizer and other products. We had a case where producers ran out of covers: the sanitizers were ready, bottled but no cover. The ministry had to make contacts and series of calls to finally get enforcement agencies to allow free movement of these items. Generally, it was the same for most packaging products.

Also, remember that Mr. President’s lockdown order was initially for Lagos, Ogun and the FCT; while we had some states declaring lockdown and curfews on their own. Some of them also had their list of essential items as pronounced by the Governors. The problem was, most of the states’ lists were less inclusive, and the task forces took advantage of the situation which created unnecessary delays and gridlock. Fortunately, most of the state commissioners concerned were contacted and the issues were resolved but not without avoidable loss of resources and time.

For raw materials, it was a different and more complex hurdle for us. It quickly became apparent that we do not have the basic raw materials for a lot of our productions, hence the problem of clearing became a serious barrier. You had a situation where imported inputs could not be cleared because the banks were closed; payment of excise duties and charges was not possible because there was no arrangement for online payment of most of these charges and physical presentation of payment evidence to concerned authorities. Here again we were able to intervene successfully.

We also had to deal with the problem of casualization of factory workers. Most of them refused to work, especially in Lagos, because there was no benefit or insurance cover for them. It was understandable for them to take that stance. After some back and forth with affected manufacturers, we were able to get them back to work.

Overall, I have a sense of fulfilment. Despite all the foregoing challenges, we were able to keep factories producing essential commodities running. Also there was no report of shortage or absence of essential commodities in any part of the country, therefore we have delivered on the assignment given by Mr. President. Looking at all this, I am personally fulfilled and satisfied by the activities of the Committee, especially the EOC. The Ministry, through the Emergency Operation Center received over one hundred and thirty cases during the lockdown, and were able to successfully resolve about 121, while others were channeled to more appropriate quarters. 

TCA: You are the chief strategic implementer of the government’s policies to attract domestic and foreign investments and promotion of industrialization. What are your concerns in the face of the current economic realities?

Adebayo: The global disruption of production value chains has exposed the need for increasing domestic production capacity in MOST countries, particularly for items that are considered “basic” or “essential” to national needs. We expect a focus on building and rebuilding this capacity from all countries as a greater sense of normalcy returns. This suggests even more aggressive competition for Foreign Direct Investment and investor attention from better developed economies.

Given the keen competition for capital and the incentives that many countries will offer to attract investors, the economies that will win will be those that are able to provide investors with attractive prospects in a conducive business environment.

We believe that properly coordinated efforts by government agencies can help to assuage investor concerns, restore investor confidence, and position Nigeria itself as an attractive investment destination.

Our reform efforts to improve Nigeria’s business environment need greater sense of urgency to remove the administrative bottlenecks that underlie the challenges faced by new and existing investors in starting and running business in Nigeria.

TCA: Nigeria’s NIRP policy (2015-2020), for which you are the accounting Minister, is in its mid-term. What are the gains, challenges and opportunities that emerged from the implementation of the policy, so far?

The Nigeria Industrial Revolution Plan (NIRP) was actually launched in 2014 to serve as a roadmap for the industrialisation of the country. The Plan, because of its uniqueness and robustness, was adopted as the industrial component under the Economic Recovery and Growth Plan (ERGP).

 It is important to state that before the launch of the NIRP, there were no clear-cut detailed directions for the manufacturing sector that recognised specific areas where the country possessed comparative and competitive advantages.  Since the launch of the Plan, sector specific policies for Cotton Textile & Garment (CTG), Sugar, Automotive, Leather & Leather Products, Cement, Tomato etc; have been formulated to ensure growth as well as encourage and facilitate investments in these sub-sectors where we are well known to have the comparative advantage.

The implementation of these policies has resulted in Nigeria attaining self-sufficiency in Cement manufacturing and we are even now exporting to other African countries. There has been increased investment in the Sugar Industry with a view to meeting a bulk of the Nation’s demand by 2025. In the same vein, OEMs have commenced investments in the Automotive Industry in the country.  There have also been renewed interest and investments in the CTG as well as the Leather sectors resulting in CBN injecting billions of Naira in the anchor borrowers scheme to support farmers in the Cotton and Tomato sectors.

The NIRP is a ten (10) year Plan, which is currently undergoing review. It is expected that the mid-term review of the Plan, which is being carried out in conjunction with other stakeholders will focus on more sectors, such as the Paper industry, Batteries, Tyres as well as Electric Meter Production.

TCA: By the latest World Bank ranking, Nigeria is currently among the top ten most improved places to do business in the world, jumping 15 spots from 146 to 131 out of the 190 countries surveyed. What are you doing to sustain and improve the record?

 Adebayo: First of all, please note also that Nigeria was named one of the top 10 most improved economies in the world for the second time in three years. Nigeria is one of only two African countries to make this highly prestigious list.

The steady improvement in Nigeria’s ease of doing business score and rank is a testament to the reforms implemented by the Buhari Administration over the past four years in line with the reform agenda being implemented at national and sub-national levels across the country since the establishment of the Presidential Enabling Business Environment Council (PEBEC) by President Muhammadu Buhari in July, 2016.  The PEBEC, chaired by His Excellency the Vice President and myself as Vice Chair, with 12 other honourable ministers as members amongst others, has, through the Enabling Business Environment Secretariat, collaborated with ministries, departments and agencies (MDAs), the National Assembly, the Judiciary, State governments and the private sector to carry out over 140 reforms so far in a bid to remove bureaucratic constraints to doing business in Nigeria and make the country a progressively easier place to start and grow a business.

Since 2016, the PEBEC has executed five iterations of its home-grown reform strategy, an accelerator tool comprising concentrated interventions focused on enhancing collaboration across government to enable a seamless business environment in Nigeria.

Furthermore, the Executive Order 001 (EO1) on the promotion of transparency and efficiency in the business environment has been acknowledged as one of the most innovative strategic initiatives to deliver quick, pragmatic changes for Nigerians. The Order mandates MDAs to develop and publish schedules of fees and timelines to establish service delivery standards. A report card is issued every year in keeping with the promise to improve transparency and efficiency in the business environment. Today, citizens and businesses are able to demand services in line with the published standards and can lodge and/or provide feedback on services rendered by government agencies on the ReportGov.NG platform. The ReportGov.NG platform provides opportunities for the private sector to hold government agencies accountable and further strengthens the reform monitoring and evaluation process.

The private sector remains the fulcrum of the ease of doing business interventions. We are committed to more engagement between reform-implementing organs of government and the private sector players and we are happy with the progress recorded since the last ranking of the World Bank in October 2019. Let me highlight a few of the reforms implemented so far:

The Nigeria Immigration Service has completed the installation of the Migration Information and Data Analysis System (MIDAS) – a global travel security standard – at the international airports.

The passage of the Companies and Allied Matters Bill 2019 by the 9th National Assembly.

Certificates of Incorporation of Companies will now carry Tax Identification Numbers (TIN) – a product of the collaboration between the Corporate Affairs Commission and the Federal Inland Revenue Service.

The reduction of Right of Way charges by State Governments.

We are working with other agencies to ensure the full implementation of the National Single Window and also install scanners at the ports.

TCA: What are your concerns for having a single market for goods and services in Africa vis-à-vis implementation of the AfCFTA?

 Adebayo: First, I think some context is very critical. As you know, Nigeria was one of the last to sign on to this agreement. And the reason is the significance of Nigeria in the African economy, with a very large domestic market of over 200 million. By definition, the issue of whether we are a net beneficiary becomes important as we are a natural magnet for exports across the continent in an AfCFTA world.

Also, as you may know, of Nigeria’s top 15 trading partners, 3 are Africans. Two of those 3 i.e., Ghana and Cote D’ivoire are part of our Ecowas trading bloc, while the 3rd is South Africa, the largest economy after Nigeria. We believe that in addition to the impact of AfCFTA, the likelihood that the Covid19 pandemic will also lead to the shortening and regionalization of global supply chains will also lead to a shift in the structure and dynamics of our trading partnerships and therefore more trade with African countries.

However, it is not all about concerns. The AfCFTA provides immense opportunities for Nigeria’s service companies to expand to Africa, especially those in financial services, e-commerce and the digital economy. Nigerian companies have built critical capacity in these sectors and have long desired to expand to Africa but were constrained by trade barriers which the AfCFTA will remove.

Finally, note that a key part of Nigeria’s overall industrialization strategy is the increased domestication of production. This was always going to drive a reduction in our trade balance deficit. However, with the COVID-19 as I mentioned earlier and the shortening of global supply chains, this will only be further accelerated and we are positioning to benefit from it.

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