Tech-In-Series…Sharing For a Better World

I have always wondered what a better the world would be if we did more in sharing rather than be locked in a combative battle.  I am sure a better world would be ours if we keep a blind eye at times at naira sign that glistens on every cherished note.  I am sure in such avenues will the creativity of mankind bloom to solve the most pressing issue of the globe. From content, events, multimedia and entrepreneurial opportunities, we are sharing with information getting viral in a second. If we imbibe this in all we do, I mean beyond the profit motive at every instance, there will be more social values to protect and we will have a more prosperous and happier world. I am sure that our climate will be better if we cared how we throw our litter and our neighbourhoods will be safer even without tall fences and tinted windscreens. We would have fewer bankers who use leverage instruments to overhang the system leading to loss of jobs.  It will be a better world if we all believed all our actions are not of private costs but have social impact on an unknown mass.

I was part of the Second Tech-In-Series which focused on leveraging on technology platforms to boost citizen participation in governance. Tech-In-Series is organized by the Co-Creation Hub and founded by Femi Longe and Bosun Tijani is a 48hr experiment living lab gathers geeks and designers to co-create novel web and mobile based solution aimed at empowering citizen to contribute to good governance.

I submitted a novel idea to make Nigerian budgets to be more readable, accessible and interactive via the web and mobile application. I have often been ashamed of how I glean facts from Nigerian budgets and its attendant effect on citizenry but only few understand the complex items of the document. It is a fact that budget as a proposed financial statement is a public document but the dexterity needed to understand it bit by bit is not available to all Nigerians.

In 48 hours the camp started, we were expected to come with a prototype and a sustainability plan that transform the idea to the product. The members of the team were anonymous to me and the tech tools to transform the idea were also unknown. I found myself in midst of passionate people with infectious energy ready to take the idea to next level and for non-profit to the employed team members; they brought their hard-earned skills to the team. My idea was named BudgIT was judged second losing to the Resident Reports idea.  It was a glorious moment to see how young people will work energetically for a common purpose to help their society. The biggest point in the event was not the prize but when I saw the geek in my younger brother who with his peers was working another project Citizen Vine.

Many people of great respect have talked up on how social entrepreneurship is a key factor to solve the global problems. I have always believed that social injustice and all that synonymous with a picture of that half naked child with a begging bowl can find its solutions, if we have more change makers who rather than sip gallons of coffees in cozy offices have an humane heart to reach to the world. I have seen them in iHub Kenya and also countless of these ‘Cheetah Generation’ in Nigeria. Let keep applauding Co-Creation Hub and other social entrepreneurs to do more, let’s understand in a world of shared responsibility which they believe in, we can all make the world a better place.

Jobs and Resource Value Chain

What a year so far! It’s being a year of addictions with the BB. I mean at first my blackberry and Buhari-Bakare ambition . I am always locked in an internal battle to stop talking, hawking or thinking our lame politics. I wish I really stopped being concerned on the streets. I wonder what’s this inner anger with me to put Nigeria in a proper place of nations? Am I crying more than the bereaved or being more catholic than the Pope?  Am I bothered than the Nigerian who sees government as stage play and watches the actors do performance of intrigues. Never mind, It‘s just me passionate about Nigeria and considers how effective public policy puts this country in the right part. I will quickly show you two examples both led by the PDP government.

There was a time in this country when telephone was a prime luxury. I remembered how long I queued at NITEL Ibadan to make a call to my dad who works at Lagos. But we are witnesses of rapid change in our life as a result of boom in the telecomm sector. How in over ten years we have moved from an abysmal 400, 000 lines to 83 million lines? It is to the credit of Olusegun Obasanjo and Ernest Ndukwe that we have seen this boom but that they have left NITEL to stink is a matter for another day. Let takes a value chain analysis of the telecoms sector and the impact on jobs.

When the telecoms sector came in, there was massive boom in banking and structuring facilities for them (jobs), then you have to print recharge cards (jobs) . Someone has to distribute recharge cards along the retail and wholesale level (jobs). I have more than seven spots on my streets that sell recharge cards on my phone if we extrapolate that nationwide that will equal millions.  Not neglecting that I can use my ATM, mobile or web because least some one sits the server end (jobs). Then the companies have to do advertising, network expansion through local contractors, cleaners , security agents to man offices and masts (jobs) , someone imports telecoms equipment, there is a clearing and forwarding agent, then someone starts a telecomm training center  and employs an engineer. MTN thinks of Who wants to be a millionaire contracts it to an event manger (jobs), event manager guy looks for ushers, skilled cameraman, animation experts? Can you ever think of how many schools have been built, CSR projects and jobs such as customer service officer, tower riggers, mobile app developers, network engineer, phone retailers and much more. These were lost jobs of the past but a simple government policy backed by law made this happen.

Now let’s take the analysis of the oil that we have and don’t refine, the land we own that we don’t till or the iron that we have and can’t make steel. With facts I am sure of, It is estimated that, about US$910mn, on a monthly basis, was expended to import refined petroleum product in 2010. In the same year, the country earned an estimated average monthly income of US$3.5b, translating that about 26% of total oil earnings for the year goes out of the economy to settle the purchases of refined petroleum product! Why would our last refinery be built in the early 80s? Why would after the firesale of OBJ technically deficient refineries, Yaradua reversed it and we still have not moved an inch to building even cottage or modular refineries.

You extract oil and government takes full taxes on the oil its people would use.  Then you pay a foreign shipping line to take it to Ivory Coast or anywhere and then the Gbagbo’s government takes all the taxes and duties for the import. The refineries get the oil refined but will surely do it with a profit (the cost to be borne by Nigerians).  Rather than we profit from the residue of oil needed by plastics, petrochemical and other allied industries, we pay the shipping company back to bring only petrol, kerosene and diesel separately back to us.  Then our customs and others take full import duties charges at our ports.  When oil fluctuates due to the madness of Ghaddafi, the costs of subsidies rise as well for Nigerians. Rather than us build lasting structures for refining, we create a short circuit founded on patronage and about N785bn was estimated to have been spent on petroleum subsidy in 2010. At very export of the crude oil, we have also exported direct and indirect jobs. We sold the job of the fresh engineering graduate, the nimble accountant, the recharge card seller , the canteen woman, the technician with three kids in school. We export jobs when we export our natural resources or leave them to waste like gas and import them back as  finished products.

 

 

 

 

 

The imported subsidized oil is used to fuel our imported generators on which Nigerians spend almost 2 trillion naira. What of impact on the environment and so on. We might have created jobs for the generators sellers in Oyingbo and Mikano might employ ten maintenance engineers but what is the multiplier effect on the general good of the economy. Nigeria really needs help. The same goes for rice and sugar importation when we have plains of fertile land. We have the tact strategy, clear roadmap and implantation plan to fix this anomaly. I have seen volumes of documents, so I am not a nerd presenting new ideas. There is just a system that benefits government stooges. They tap Nigeria like strings with efficient importation and collection of subsidy and you wonder why they would be happy to keep the system that way.  The government that stands as a bridge for public good is of them and financed by them.  When the infrastructure rots and government policy is in a somersault with no iota of transparency, the country becomes incompetitive  it will be a buying and selling , import and export economy and only  few foreign investors will erect a structure there.

Nigeria needs change and it’s that of transparent government that forgoes the import/export interests of few cronies to find the right policies that values competition and expand the economy. Our job agenda rather than distribute more motorcycles, make graduates traffic wardens, tree planters or cleaning officers, should be  to first knit our education system with entrepreneurial skills, boost infrastructure,  SME lending  and explore our natural resource from first  to last end of value chain, and in between jobs will arise.

 

 

Nigerian Economy – My Competitiveness Diagnosis

Every country in this globalised world is looking for competitive ways to remain an export engine or an outpost of global trade. The BRIC (Brazil, India, China and Russia) are using internal fiscal and trade policies to empower their people and tapping into their demographic strength to produce competitively. The oil rich emirates (Bahrain, Qatar, UAE and Oman) are carving a liberal niche, building the biggest structures and developing strategies to make themselves an avenue of global trade and tourism.

A look at the top twenty economies shows traits of a booming service sector or low cost industrial base that maximizes human capital. Though many are blessed with natural resources, they are maximally using it to power new sources of growth through innovation and industrial growth.  The Top twenty own the biggest industries of the world, best sets of education, attractive financial industry and most importantly they tap into the creative energies of their people. They have diverse leadership ideologies but they guard their interests to remain competitive through job and value creation.

By competitiveness, Nigeria is classified as factor driven economy where growth is primarily determined by primary production factors especially land unskilled labour and capital.  Factor driven economies like ours are mostly sensitive to world economic cycles, fluctuations in exchange rate, commodity prices and are mostly resource based economies. Ours is oil and this clearly shows why oil provides 95% of our foreign receipts and the sole determinant of our budget procedure is the benchmark price of oil.

Nigeria according to Goldman Sachs has identified in next 11 economies with potential to bloom after the BRIC. Nigeria is also among the most populous African countries known as Africa11 with huge demand potential and spending pattern. According to Goldman Sachs report, by 2050 Nigeria and other populous African peers will aggregate to a G7 economy size. Potential can always be static if we don’t take a look at the critical solutions of the Nigeria economy. Recurrent expenditure with gross inefficiency are piling up amidst a few available jobs in a surging youth bracket.

I have taken account in how we want to create jobs and this involves more than doling out money at low rates or empowerment schemes that hire graduates as traffic wardens or tree gardeners..  Nigeria has got natural resources but according to an IBM analysis, Nigeria with its other Africa peers doesn’t explore their natural resource to last end of value chain where lies the critical mass of profits and jobs. We are either producing oil to refine elsewhere or with acres of arable lands import rice or have solid minerals with a moribund steel industry.

We are in a dividing-the-pie syndrome with monthly allocation handed to states when there should be the right policies to activate private sector growth. The pertinent question is how does Nigeria accelerate its enormous potential to possibilities? How will Nigeria take the leap from factor driven indices to build massive creative distractions from diminishing oil- its present sustenance? Nigeria has a young population with 65% of the population under 40 which stands a risk as well as an opportunity. It also owns diversified natural resources especially proven gas reserves that can last for 110 years. To transit the Nigerian economy to an efficient driven will require consideration of the outlined metrics:

  • Convergence of Public and Private Policies: Public policy has to clearly defined with opportunities for private sector interests that values competition, value chain development, societal development and profit maximization. There has to be continuous robust discussion between both sides to develop a common purpose of creating shared wealth and expansion of the middle class.
  • Competitive Federation Structure: Nigeria at present has not devolved powers to its states as the federal governments takes over 56% of current allocations. It is also of note that most states are run with poor macroeconomic and debt management. Nigerian states have to wean themselves from oil based revenue and pursue expanding-the-pie solutions to develop its own people. This requires granting more autonomy to states to explore its strengths and find opportunities to collaborate for efficiency. States can develop an agricultural, industrial, green economy, resource based, service sector or technologically based approach and this requires sound leadership currently few in numbers.
  • Political Stability, Budget Discipline and Transparency: Nigeria has a poor budget performance with an average of 50% in Nigeria over the last five years and more worse in most states. The budget has a rising level of 69% recurrent expenditure in the last three years and such does not free up funds for capital projects which are engines of growth. The recurrent expenditure need to be restructured to prune unnecessary growing expenditure mostly especially in government overheard expenses, personnel cost and cost of subsidies.  A transparent government that forgoes the import/export patronage system  of few cronies to find the right policies that values competition and expand the economy is of urgent need.
  • Bridging the Unbanked gap: Access to finance is a critical issue in Nigeria as 65% of its population who are presently unbanked. The banks have to be properly regulated with stable policy mechanisms and this is through sound corporate governance and risks mechanisms. Reaching the unbanked has to pursued with microfinance banks. Such banks need to ride on accessible technological support, innovative products backed to deliver efficient services to the rural and low income population.
  • Infrastructure Development: Nigeria’s infrastructure deficit stands at $100bn and as such will need massive scale of finance to plug the gaps. This requires FDI flows through Infrastructure financing and development of private and public partnership. Power is especially the net contributor to the huge deficit with a 3,500 megawatts which clearly explains why the manufacturing sector of a populous country contributes 4% to its GDP. Competitiveness will hugely improve if clear policy direction, private sector support and enabling environment is provided with the power sector reform. Railways, roads, agricultural assets access to market, enhanced distribution network and water supply needs to managed efficiently to scale the infrastructure hurdle.
  • Human capital Development: Nigeria presently has a competitive advantage in terms of an active labour force with represents over 70% of the population. This is also a possible risk as unemployed youth population will scale up vices such as militancy, kidnapping, cybercrime and son that present threats to competitiveness.  A quick surgery needs to be done the curricula, educational infrastructure, getting trained personnel to develop next set of national champions. There has to be a development of industrial or technical based training that transfer our natural resources in finished products based right on our own soil.  Nigeria needs to replicate global structures of education with a sectoral revamp and allow more import of scientific knowledge based increased exchange interaction and ploughing back skilled Diaspora into the economy.
  • Sound Trade policies: China and India in terms of GDP per capita and most of Asian countries dubbed workshops of the world are low cost economies with growing influence in the Nigerian economy. Nigeria needs to reinvent its local SME industry and improve its infrastructure to reduce direct competition with low-cost imports from these countries. A clear trade policy that refine the Nigeria economic sector to tap into its uncultivated arable space, mining potentials, petrochemical and crippling agro-allied industry needs to be formulated. Nigeria needs to acquire massive know how, infrastructure development, promote incentives for home grown industries and accept imports of goods in places of scarcity in the Nigeria’s economy. This will support growth of jobs internally and reduce capital flight that puts our currency at a peril.

Nigeria has enormous potential to expand its middle class and become an efficiency-based category of competitiveness. This will gradually lead to develop of research-based institutions, innovation development, flow of capital, high end technology, increasing wages and reduced inequality. All these are traits of a country that seeks relevance in 21st century global economy. Politicians can make a hell of promises on their plans for the economy but with now strict management of excess crude account, over blown recurrent expenditure, Nigeria has to set quick priorities  (not political projects like 36 airports) hinged on right competitive parameters.  It all depends on the right and upright leadership that can use the right policy based on equity and social justice to take the best out of our multiple resources – the human and natural.