Enalamah underscores importance of infrastructure for industrial clusters

R-L: Facility Manager, Mr Alex Morrow; Hon. Minister, Industry, Trade and Investment, Dr. Okechukwu Enelamah; Managing Director OGFZA, Chief Victor Alabo, and Head of Administration & General Service, Mr Chibuisi Onyebueke, when the minister toured the facility as part of a two-day retreat by his ministry

A two-day retreat on May 20 and 21 in Onne Free Zone by the Ministry of Industry, Trade and Investment, to discuss and strategize on diversifying the Nigerian economy through SMEs development and industrialisation, underscored the importance of industrial clusters to valuable development of sectors of the economy.
In that vein, the Honorable Minister of Industry, Trade and Investment, Dr. Okechukwu Enalamah, while on a tour of the multi-serve facility as part of the retreat, recognised how such infrastructure and the cluster, with about 200 different operators have contributed to sustaining operations in the oil sector over time.

The minister spoke on the efforts of the agencies under the ministry saddled with the responsibility of ensuring standards in local products for exports, in order to avoid rejections by international markets.

Enalamah also spoke on a number of sundry issues and the way forward to stabilising the economy through the non-oil sectors.

What role do you think a facility like this can play to support the industrial cluster initiative?
A facility like this has many benefits; one of the benefits is the demonstration effect that this can be done, because it was almost being implied that you can’t make something work here.

When you visit a facility like this where the private sector, working with the relevant agencies of government, have made a firm commitment to make something work and actually doing it and doing it consistently, and have been done for several years now, I call it the demonstration effect. There is a saying that ‘if you can fly one plane, you can fly 20 or even 100.’

The second thing is the particular importance of this facility to the oil sector; it has been a very important player in the oil sector providing the right infrastructure; both hard infrastructure and soft infrastructure like power, transport, logistics, which is what Intels is all about.

Soft infrastructure, you talk about the policy consistency and planning, in a way that they know what your policies are, they know you are in a stable environment that they can operate. I think all those things, like an oasis of sanity of sort, has been very helpful to the oil sector. I also think that is why they have about 200 companies operating here and able to deliver on services, which in turn helps us to be able to continue with our oil production, be a part of the global economy, which is what the oil sector is really.

The third thing is the development of Nigerians; every company you go to they tell you how they have systematically developed Nigerians, and that is how our people get well trained, become more qualified, they earn more. There is no reason why that cannot become the standard, and the same thing can happen in every sector all over Nigeria. So, one of the things we will want to do as government, is to make sure we are creating the environment for businesses to thrive because if they are thriving, it is our people who are thriving.

When Singapore started, I read the book written by Lin Qua Yu, the Prime Minister who made Singapore what it is. He said, even though he didn’t like the British for colonising Singapore, when they left, he recognised their importance in terms of the skills and the know-how they brought, and he swallowed his pride and sense of injustice and partnered with them to develop Singapore.

He said to them,  ‘I want you to stay, I will create the environment, provided you train my people, give them jobs.’ Of course, that was how he started and started to do all kinds of special economic zones, which were instrumental to the development of Singapore. I think we have to do the same thing; we have to partner with both local and foreign interests to build the Nigeria of our dream for the sake of our people.

What is the ministry doing to reduce the rejection of Nigerian products for export due to standardisation?

Am sure you understand the question, dealing with quality and standards on Nigerian exports. There had been incidences when Nigerian products were reportedly rejected abroad.

It is something we take very seriously, we ensure that the agencies  and departments of government that are relevant to exports and standards, have actually been working together in inter-ministerial, inter-agency model as a group to deal with this issue and am quite confident it is receiving the right attention.

The Nigerian Export Promotion Council to Standards Organisation of Nigeria, to NAFDAC, and to the ministry itself, we have been meeting; in fact, we have discussed all these in our last meeting we had with the agencies, ministry of industry, trade and investment.

This matter was discussed and I was very satisfied with the responses we got because it ties into a bigger policy trust, which is really promoting export. I am sure that you have heard of the zero-oil strategy of the Nigerian oil promotion at the NNPC, which again, is what the NNPC is working on with other agencies. The whole idea is to say if we play to our own comparative advantage as a nation, there is actually no reason why Nigeria cannot produce enough for its own people and ultimately export as well.

Part of it has to do with creating the enabling environment for these exports to happen; part of it has to do with empowering the relevant agencies to work in a collaborative way, and that is why I mentioned creating enabling environment that is friendly to business, to support them.

If you are the Standards Organisation of Nigeria for instance, and you are regulating exports, and you are doing it to help the people export more, you are actually the ally, not an adversarial regulator and that is really the way we want it.

We want to be able to support our players who are based here to succeed. That is why we are having this retreat, and we have had a very good first day and a lot of it was around synergy, a lot of it is around making sure that our policies are implemented in a very sound way where we are working collaboratively and I think you will find the probability of our goods being rejected, going forward, is not likely, and that is because of this collaborative approach now.   

Issue of SON being physically present in the ports?
The standards Organisation of Nigeria obviously have an important role to play by definition, given its name. I think SON has every interest in making sure they are monitoring, evaluating and encouraging standards of goods being produced here and those coming in and goods trying to leave here. So, my understanding is that they have been trying to get better collaboration with the ports. At a stage in the port they tried to streamline the number of agencies including SON, not to be physically there.

But you need to understand that where the ports are coming from as well, they want to be much more efficient, much more technology driven. The point is that you don’t throw away the baby with the bathwater’ while we are removing the rent-seeking and the bad behaviour, we shouldn’t then ignore the importance of standards.

Therefore, there is every need to have a dialogue with SON, and plan how, as part of that one-stop agency model that we are now trying to pursue, where everything happens without too many stops and bureaucracy, but such that you know you can’t ignore standards.

I am confident that that will be addressed. We have better collaboration with this government and those discussions are ongoing. In any event, there is an attempt to automate the ports and make sure that all the relevant agencies are plugged into that automation so that everybody can, using technology, including SON, do their own work without being excluded, and I think the role of SON is very much recognised.

Does zero-oil policy have anything to do with industrial cluster and is the government interested in the policy of industrial cluster policy?

Two things that you mentioned are related, but synergistic. The zero-oil strategy of NNPC is based on the idea of trying to create a non-oil export, and also a non-oil diversified economy, which clearly, in order to do, you need to create the enabling environment for the non-oil to thrive.

That enabling environment is where the clusters, the industrial parks, and dedicated economic zones come in. Because it turns out that the things that inhibit industry if you really think about it, are infrastructure, which include things like power, logistics, and transportation.

We talked a lot about that today, so, you can actually concentrate efforts and focus on industrial clusters and centres, to make sure that all the required infrastructure you key them in and you still have to plan. You can also think about all the other things you can do in terms of suppliers.

 One of the famous professors of strategy, Michael Porter, who wrote on industry and competition, was actually the one who talked about these clusters. The whole idea is that all the people who are related to an industry can come together, work together; the suppliers and the customers.

So, they are mutually reinforcing. It is not like you are trying to manufacture auto and every part is in a different place. Therefore, clusters reduce the cost of operation. I am very confident that Nigeria is headed in the right direction because we are going to move from the buzz words to actually doing it.   
We had a good meeting and we are coming up with our game plan.