The Organised Private Sector, OPS, yesterday, insisted that the Central Bank of Nigeria, CBN, must review its policy on the 41 items restricted from official foreign exchange market.
According to the group, the decision is hurting the manufacturing sector in such a way that could no longer be ignored, having led to the closure of many companies and relocation of others from Nigeria to Ghana and other neighbouring countries. It has also led to the refusal to repatriate over $10 billion held offshore by Nigerian businesses. These views were expressed by the Manufacturers Association of Nigeria, MAN; National Association of Small and Medium Enterprises, NASME, and the Lagos Chamber of Commerce and Industries, LCCI, at a ‘Stakeholders’ Dialogue on the Manufacturing Sector in Nigeria’, organised by NOIPolls and the Centre for the Study of the Economics of Africa, CSEA, in Abuja.
Generally, MAN, NASME, LCCI and NOIPolls stated that about 272 manufactures are either ailing or have closed shop over the last couple of months, while thousands of jobs are being cut on a daily basis.
According to Mr. Vincent Nwani, Director, Research and Advocacy, Lagos Chamber of Commerce and Industry (LCCI), the CBN announced the 41-item list without consulting the sector and that the chamber has made several representations to the apex bank without the desired results.
“We did press releases; we did stakeholders engagement; we engaged with the CBN at all levels, at least three times; we met the directors twice–up to the CBN Governors on this same matter of the 41 items- giving them examples of product-by-product. There must be an urgent review of the CBN’s policy on the restriction of access to foreign exchange placed on 41 items, as about16 of the total items in the list, serve as critical raw materials for intermediate goods produced in Nigeria, especially as the country lacks the capacity for optimal production of the items.”
Specifically, he said the ban on oil palm has led to the loss of about 100,000 jobs over the last couple of months, with major blue chip companies in Nigeria relocating to neighbouring countries; while the ban on glass and glassware has led to the loss of 80,000 jobs mainly in the pharmaceutical industry, as companies in this sector now find it difficult to package their products.
He said: “Local production of oil palm is put at about 600 metric tonnes annually, but the total demand of the country is put at about 1.8 million metric tonnes. Today, Presco Oil has orders of up to December 2017 to fill, it is presently hard pressed with demands. Listing oil palms among the restricted items meant that we have a shortfall of about 1.2 million metric tonnes.
“Some of the items placed on the restriction list by the CBN should be reinstated until the country develops the capacity to produce them locally. Some of the items need a period of between three and seven years for the country to develop self-sufficiency in their production. For instance, it takes a minimum of five years for oil palm to be planted and for harvest. The CBN should have given us more time. The manufacturing and industrial sectors lost about N1.4 trillion as a result of foreign issues, while about 780 raw materials needed by the sector were affected by the restrictions placed by the CBN.
“I have talked about palm oil, I have talked about glass and glassware, I have talked about rubber and rubber ware. Glass and glassware, rubber and rubber wares you need about a 3 year gestation period. The palm oil, we need 5 years gestation period before we can have the local capacity to be able to supply the 1.2 million metric tons that is in deficit as we speak. I will not be able to remember all the items off hand but we have the list and I can simply make it available.
“We have sent it to CBN before, they put up resistance about it and we are ready to send it again. You know the challenge the organized private sector had initially was that we were not able to understand the magnitude of this challenge.
“We are making this demand on the basis that we don’t have local capacity for the affected items on the list. Even if we are having scarcity of foreign exchange some of these lists need to be supplied and because of that, few of our members who have been able to earn export credit or export income in dollars have refused to bring it in or repatriate it. We have about $ 10 billion stuck in one country or the other earned by our members. Some of them are not manufacturers; some are agriculturists or merchants of different products. They cannot bring it in because the business confidence, the manufacturing confidence, industrial confidence is negative.
“Until we do something to boost this confidence all of this money will be stocked abroad. Even Nigerians that are living in the Diaspora that was able to bring in $ 23 billion in 2013. Last year we saw about 5 billion dollars, this year it is going to be less than 3 billion dollars. This is what negative confidence can do to an economy.”
Speaking in the same vein, Executive Secretary of NASME, Mr. Eke Ubiji, stated that recently, about 222 of its members have either collapsed or are ailing, while he blamed lack of access to credit, foreign exchange challenges, high interest rate, multiple taxation and poor infrastructure, among others, for their woes.
Also speaking, Mr. Ambrose Oruche, Director, Economics and Statistics of the Manufactures Association of Nigeria, MAN, lamented that the unavailability of productive inputs is the major challenge confronting manufacturers, stating that this was as a result of the restriction placed by the CBN on certain items.
According to him, the current operating environment in the country is harsh for many manufacturers to continue to operate, disclosing that some economic policies churned out by the Federal Government and the CBN are conflicting and are retarding the growth of the manufacturing sector.
He argued that the manufacturers were not consulted by the CBN and other regulators before the restrictions were placed on the items, noting that many of the products under foreign exchange restrictions are raw materials needed by manufacturers.
He said, “Presently, about 50 manufacturers have closed shop, while some have downsized.
Some manufacturers are still producing due to their love for this country. Government policy on cement should have adopted in this case.
“In the case of cement, Nigeria used to be a net importer of cement, but the government set up a policy over a five-year period, which made it possible for us to be a net exporter of the commodity.”
Mr. Oruche further faulted the decision of the CBN to increase the Monetary Policy Rate, MPR, to 14 per cent, stating that it has made it difficult for manufacturers to access funds to finance t heir operations. According to him, the fact that the economy is technically in recession, the CBN’s effort should have been directed towards expanding the economy rather than contracting it.
He also listed high interest rates, poor patronage of local manufactured products, poor supporting infrastructure, such as poor power supply, policy somersault and policy inconsistency, among others, as the challenges confronting manufacturers. To address the declining fortunes of the manufacturers, Mr. Oruche called for the resuscitation of domestic refining, as this would ensure that certain chemicals imported into the country, can now be sourced locally.
He also stated that attention should be paid to developing the infrastructure base of the economy and also on energy generation and distribution, while the Federal Government should also grant incentives and concessions to businesses.
The Chief Executive Officer of NOIPolls, Mr. Bell Ihua, said that the organization’s survey covered all six geopolitical zones of the country and that urgent actions were needed by the federal government to save the sector.
International Breweries To Train 500 Young Entrepreneurs Through Kickstart Initiative
As part of its commitment to bringing people together for a better world and its objective of delivering impactful, developmental and sustainable projects, International Breweries Plc through its social investment arm, International Breweries Foundation has launched the 6th edition of its Kickstart entrepreneurship programme recently.
The initiative is targeted at enterprise growth and development for young entrepreneurs between the ages of 18 and 35.
During a media briefing to update the public on the process of this year’s edition, Managing Director, International Breweries Plc, Hugo Rocha expressed delight that the Kickstart Initiative had evolved from the regional programme it used to be, to an inclusive national programme that reaches the six geopolitical zones and 36 states of Nigeria.
“Over the years, we have held the conviction that the energy, zeal, and brilliance of the youths of Nigeria who constitute about 70 percent of the total population should be tapped and channelled to productive use. This is the logic behind Kickstart – to promote a culture of entrepreneurship among young people through training, provision of capital and mentorship,” Rocha said.
Rocha concluded his remarks on a high note, stating that, “as International Breweries celebrates its 50th Anniversary this year, I am pleased that the results of a 3-year impact assessment study that we commissioned on Kickstart came out positive and gives us the confidence to continue to support young people to achieve their dream of entrepreneurship. We remain steadfast in our commitment towards the economic development of Nigeria”
Also speaking at the press conference, Chairman, Advisory Board, International Breweries Foundation, Peter Bamkole explained that International Breweries Plc and its foundation is dedicated to continuing to contribute its quota towards tackling the twin challenges of unemployment and poverty while promoting Decent Work and Economic Growth in line with Goad 8 of the United Nations Sustainable Development Goal (UNSDGs).
“By creating Kickstart, International Breweries Foundation set out to be the nursery of innovation in a business where budding enterprise managers are groomed—held by the hand and taken through the rigour of entrepreneurial work. We aim to produce well-rounded entrepreneurs who understand and are prepared to put in the work it takes to do business successfully in a unique climate like ours.” Bamkole said.
Over the past five years, the Kickstart initiative has provided training, mentoring, and seed capital of N325,136 million (in total) for 274 grantees; 708 direct beneficiaries and 2,832 indirect beneficiaries across a wide range of business sectors; with the result of the creation of about 571 jobs and 1,392 new jobs projected across the six geopolitical zones of Nigeria.
Speaking on the mechanics of the award, Legal and Corporate Affairs Director, International Breweries Plc, Temitope Oguntokun revealed that the award is in three phases: the application phase, the training phase and the pitch fest phase which is the final selection of grantees by judges.
She explained that the Kickstart Initiative will be incorporating an expansive training module that will train 500 young entrepreneurs online, with a number of them going into the bootcamp. This year’s edition also features a streamlined search for entrepreneurs into Agriculture, Modular Retailing, Circular Packaging (Recycling), Technology, and Renewable Energy sectors.
“After a transparent selection process on the Enterprise Development Centre (EDC) platform via the link, https://reg.smetoolkit.ng/program-apply/kickstart-nigeria-2021, which will open on the 20th of May, successful applicants will be equipped with critical skills and training on entrepreneurship by experienced entrepreneurs and corporate professionals during a 2-day boot camp. They will partake at the pitch fest where a panel of judges will appraise their proposals before final selection. Winners of the pitch fest will then be awarded grants at the awards ceremony in Lagos,” Oguntokun noted.
The press launch which held last week in Lagos had in attendance dignitaries such as the Director for Employment, Lagos State Ministry of Wealth Creation and Employment, Mrs Iyabo Seriki-Bello, Director of Partnerships and Coordination for Small and Medium Enterprises Development Agency of Nigeria; Dr Friday Okpara; Chairman, Advisory Board, International Breweries Foundation, Mr Peter Bamkole; members of the International Breweries team, past Kickstart Alumni, mentors and a host of others joining online.
Following its trajectory of success, impact over the years, and its extensive yet immersive plans for the 6th edition, Kickstart, under the auspices of International Breweries and its foundation is geared towards transforming Nigeria into an economic powerhouse through the impact of entrepreneurship.
More and More Under 30s Seeking Financial Advice
A growing number of under 30s are seeking financial advice, according to data released by one of the world’s largest independent financial advisory and fintech organisations.
deVere Group has revealed that there has been a 54% year-on-year jump in the number of enquiries from potential clients under the age of 30 who are seeking to work with a professional adviser to devise and implement a financial planning strategy.
Nigel Green, chief executive and founder of deVere Group, comments: “The sharp increase in the number of under 30s seeking out advice, once again, debunks the myth that younger generations are not interested in building a plan for their long-term financial security.
“It would be a reasonable assumption to make that the year-on-year increase has been largely driven by the pandemic.
“It has brought into all-too-real focus how things can quickly change, how important it is to have a back-up/emergency plan, and value more than ever what really matters to them. For most, this includes ensuring that they can enjoy the opportunities and lifestyle that they desire.”
In March this year, a deVere poll of 450 clients found that seven out of 10 people will not splurge excessive savings accumulated over the pandemic.
When asked ‘Are you likely to spend the majority of the extra money you have managed to save over the last 12 months?’ 72% responded ‘no’, 16% said ‘yes’ and 12% ‘did not know.’
Mr Green continues: “Whilst it’s a fool’s game to generalise about any given cohort, anecdotally, our advisers who are working with the under 30s report that there are some definite trends.
“Perhaps unsurprisingly, more than other generations, the under 30s – who are ‘digital natives’ having grown up under the ubiquitous influence of the internet and other technologies – demand digital solutions such as fintech apps alongside their personalised financial advice.
“This gives them immediate, on-the-go, low-cost access to, use and management of their money.”
Another trend, says the deVere CEO, is impactful saving and investing.
“Our advisers say that, typically, younger people want to use their savings and their investments not only to improve their own lifestyles but for the betterment of their communities and the environments.
“Having more control over their financial affairs is a critical part of their wider activism on issues such as human rights and climate change.”
Mr Green concludes: “Perhaps more than ever, the under 30s are showing a desire to be financially resilient and put their long-term financial goals at the heart of their decision-making process.
“I believe that this ‘think about tomorrow first’ attitude is likely to be a permanent phenomenon due to recent seismic cultural, social and economic shifts.”
Econet Group and Mastercard To Collaborate on Fintech Solutions For Covid-19 Response in Africa
The Econet Group through its subsidiary Cassava Fintech International (Cassava Fintech) and Mastercard have entered into a strategic partnership to advance digital inclusion across Africa and collaborate on a range of initiatives including expansion of the Africa CDC TravelPass.
TravelPass is a digital health pass developed by Cassava Fintech and offered in conjunction with the Africa Centres for Disease Control and Prevention (Africa CDC). It is accessible to users of Cassava Fintech’s Sasai SuperApp and is recognised as one of the leading initiatives in the fight against the cross-border spread of Covid-19 in Africa. Mastercard is partnering with Cassava Fintech to enhance the security of TravelPass through Mastercard’s Community Pass platform. Mastercard Community Pass is an interoperable digital platform facilitating service delivery for marginalised individuals and communities, including access to critical health services like patient care plan tracking for Covid-19.
The joint initiative between Mastercard and Cassava Fintech seeks to offer a unified solution with greater convenience and enhanced security, that is expected to promote safe cross border travel in Africa in response to the Covid-19 pandemic.
The partnership will also allow the two organizations to explore collaboration such as the further integration of the Community Pass with Cassava Fintech’s mobile and financial services, acquiring and processing of card payments across the continent, along with the introduction of a virtual or physical card on the Sasai SuperApp.
Cassava Fintech’s CEO, Darlington Mandivenga said the partnership with Mastercard would pave the way for both companies to jointly tackle the challenges facing African economies as they re-open post the COVID-19 pandemic.
“We are excited to work with Mastercard to explore solutions that will, among other things, mitigate the risk of falsified presentation of a third party’s Travel Pass at access and transit points,” Mandivenga said, adding that the same technology could also be used in payment solutions.
Cassava Fintech uses an integrated model to provide financial and digital services to ensure a “financially inclusive future that leaves no African behind”.
“We look forward to joining hands with Cassava Fintech in exploring new solutions that will make a difference and benefit the continent. In addition to digital innovation for future travel, Cassava will also leverage our secure payments network to advance access to financial services,” said Mark Elliott, Divisional President, Southern Africa, Mastercard.
Mastercard is a leading global technology company focused on building an inclusive, sustainable digital economy that benefits everyone, everywhere, by making transactions safe, simple, smart and accessible.
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