Published On: Wed, Oct 9th, 2019

Missing steps on agric, oil and sundry matters

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President Buhari

WEDNESDAY COLUMN by USSIJU MEDANER

Last week, we were in a celebration mode but not without retrospectively recollecting factors: not few but many of them that would not allow us to joyously celebrate the new age of our dear nation. I had taken a tour of some of the factors that have, over the decades, kept us crawling as a nation; factors that have denied us the benefits of our rich heritage, natural endowments and productive utilisation of our population size. I concluded that our anger at the current situation of things in our country must only spur us to take decisive action to return to the table and plan to make Nigeria work. If Nigeria must return to the path of glory, we must altogether (all of us, across all boundaries and political affiliation), agree that we have a common problem and be ready to work together towards solving our many problems.
The process of solving a problem begins with the acceptance of the existence of the problem. Nigeria does have a number of problems and the social media is littered already with a lot of such: everyone is busy listing and counting the problems and cursing under the burden of the problems. We run the streets with the anger of myriad of problematic issues; we rarely remember that the problem and challenges would remain eternally with us except we begin to proffer workable solutions to them.
Opposition leaders, who should have taken the position of prescribing alternatives and superior solutions to national problems, have taken a detour from what is right to enjoying their daily cataloguing of problems to discredit the sitting government without suggesting possible solutions. We have become experts at comparing our country and ourselves with nations and people who are obviously doing better than us without taking cognizance of the fact that they were once having the same problems we have now and took the right path to where they are today.
So where do we begin? Our problems are many and multifaceted but it is also true that there is no problem without solution. An anonymous writer rightly said “when you find no solution to a problem, it’s probably not a problem to be solved, rather a truth to be accepted”. Every problem has a solution. Our problem as a nation over the years has been that we have concentrated absolutely on the problems instead of identifying the problems and concentrating our energies on the solutions. We resorted to blame game heaping more problems on the fabric of our nation which has been threatening our togetherness.
I intend to, in the course of this write-up, single out three (3) of our major problems. These, I consider sensitive because of their direct bearing on almost every other difficult situation we face as Nigerians. I will begin with a discourse on agriculture and the failure of Nigeria to be better and great as a consequence of near total neglect of this very sensitive sector of the economy. We must all begin from the point of realization that every developed nation did not become developed until they first attained agricultural development.
Agricultural development comes first with food sufficiency which is the primary need of individuals and nations but it doesn’t end there: with food security comes raw materials for industries. When a nation maximally develops its agricultural sector, processing industries naturally spring up to process the farm produce into finished products: jobs will created, crimes become minimal and people complain less.
At independence the major contributors to Nigeria’s GDP and individual incomes, the major employer of labour and the major source of raw materials to several industries is agriculture. The regions were self-sufficient with incomes generated form agricultural practices. The west was the cocoa producing region; every village in the region was a beehive of activities, the product turned out in tons and the mighty cocoa house in Ibadan completes the story. Hundreds of thousands of westerners were doing really well. Today, we ask, where is the cocoa house? Where are the acres of cocoa plantations all over the south west? What has become of the value chain of opportunities along the cocoa business? The jobs created and the prospects of cocoa processing industry in Nigeria. They are gone down the drain.
The groundnut pyramids, the cotton and textile industries and essential farm produce of the north have become only a theoretical subject in Nigeria. Once, we pride ourselves as the largest producer of palm oil in the world but who are we now. The south eastern Nigeria that used to be the beacon of palm oil production does not remember how to plant and process oil palm any longer.
The attention of everyone including successive government was off the sector. Even the agricultural extension officers that were a common sight in all our villages do not exist any longer. We have lost so much by abandoning the sector( over the years ). Today we are faced with the burden of unemployment when a flourishing agricultural sector alone can employ over 40% of our population along all its value chain.
Nigeria, a country of about 200 million people blessed with good arable soil that supports almost all crops suddenly became a zero producing and 100% food and drinks importing nation. We consume approximately 7 million tonnes of rice yearly yet we don’t produce rice,if not for the recent rice initiative of the present administration. Successive governments ignores our capacity to be self-sufficient in rice production and still cater for almost all nations in our sub-region and become the dumping ground for Thailand: a country with one-third of our population. If not of recent initiative
The list is endless, we import rubber tyres to the tune of US$309 million annually while our rubber producing capacity lay wasted. Nigeria, once a palm oil giant, now imports palm oil to the tune of US$199 million yearly. We import raw sugar to the tune of US$406 million yearly. We even import wheat ( that we can plant easily cultivate in the arable soil of north) to the tune of US$1.09 billion yearly, needless to talk about fish, pork, beef and poultry importation. Between 1990 and 2011, record shows that we spent about ₦1.0 billion per day on imported food and drinks.
So, what is the way forward? What are the decisions that must be made? I think we must unanimously agree that we must, at all cost, attain sufficiency in basic food production, increase local processing of export crops, increase production of agricultural raw materials for local industries and export, generate gainful employments through agriculture and grow to rationally utilize all our agricultural resources among others.
How do we achieve these? We must know and agree that we can produce almost all the food we eat because we possess the capacity. We must all become serious, beginning with the government at all levels. We must identify all the food items we import and give time frame for total stoppage of their importation and we must encourage, mobilise and incentivize farmers to the farm.
We must make effective usage of graduates of departments and institutes of agriculture. The NYSC scheme should be restructured to harness the knowledge of these graduates. Massive NYSC farm settlements should be established across the country and all corps members with biases in agriculture should be sent to the farms to produce food for the nation. Finally, every graduate willing to go to the farm must be fully supported by the government. I suggest a partnership that guarantees land availability, resources, market, storage, conversion and processing facilities.
Then we all must be patient. I have seen Nigerians complaining that they prefer the imported products because they claim locally produced items are more expensive and not readily available. Yes, they may be more expensive today due to lack of abundance in the market but they are our own and if we persist on the right wayslĺ, soon, the prices will come down and jobs would have been provided for our teeming unemployed youths. We will surely get there if only we will all agree to bear the pains of today.
Another major problem of Nigeria is the poor management of our oil and gas resources. Since the discovery of crude oil globally, development of nations have taken a new turn. Massive oil income from the sector has been the catalyst turning nations into the super civilization of the present generation. Since 1957, when we drilled our first oil well at Oloibiri, the easy money has been having all the negative effects on us; we had neglected agriculture; we had raised monsters among us who took more for themselves at the expense of all; we have become enemies for what should unite us.
Nigeria is so blessed with crude oil. As at 2019, we have an estimated 37.5 billion barrels proven reserve of oil and 187 trillion standard cubic feet (tscf) of gas. This is excluding the limitless unproved reserves and the prospects of successful continuous exploration for the natural resources. As an oil producing nation, we are in the league of Malaysia and United Arab Emirates. Nigeria produces an average of 2.0 million barrels/per day of crude oil over the last 20 years at an average cost of $60 per barrel, so the country has raked in approximately US$876,000,000,000 in the last 20 years from crude oil sales. Malaysia produce an average of 636,099 barrel/ per day over the same period, so Malaysia has earned approximately $278,611,362 over the last 20 years. The United Arab Emirates produces an average of 2.4 million barrels/ per day over the same period and has earned approximately $1,051,200,000,000.
Today these are the countries we envy and somehow, we would want to know what the difference is? Where did we take the wrong turn? How did Malaysia and the UAE become what they are today and we are still here struggling? The answer is simple, we produced but we destroy our refining power and no oil producing nation really benefit from the nature’s gift without refining it. Malaysia has six refineries functioning at full capacity while UAE has over 60 functioning refineries.
It is the quality of a country’s refining power that determines its take from the whole lot of the benefit of the large industry. For whatever reasons, when we export crude oil and buy finished products, we lose the entire value chain benefits of refining. We lose the whole capital flow in the refining process, we lose over one hundred by-products of refining, we lose the whole lot of potential raw materials that naturally birth manufacturing industries and above all, we lose out on the millions of potential employment opportunities that come with full refining power.
What is currently happening to Nigeria is that the oil producing company producing our crude and pay us stipend for allowing them, then we sell at ridiculous price at the international market. The crude is sold to other countries where it is refined to give almost fifty products. We then return and buy three of these products at very exorbitant prices leaving the refining country to enjoy the benefits of all the remaining products.
What is the way forward for the industry?
This is not a technical paper so detailed analysis may not suffice here but we must make the decision to localised workforce for all the industrial processes from prospecting, reservoir analysis, drilling, completion, production, to refining and all upstream/downstream operations. We must make the needed decision for the construction of at least three new national refineries knowing that continuous turnaround maintenance of those moribund existing refineries are waste of resources and fake hopes. We must open up the industry for private investors. We must block all designed leakages and leakage regimes: re-appraise the subsidy regime with a futuristic plan to permanently stop it. We must revisit all production agreement with producing companies, enshrined and fully implement the local content goals, restructure the NNPC to be more commercially inclined. We must see to a smooth, speedy and whole passage of the PIB and the implementation of the Gas Master Plan as well as ensure a total and final stoppage of gas flaring.
It is my candid opinion recommended that we return to the table to reconsider all efforts to review the NNDC policy and framework with the sole aim to develop the oil producing states and re-strategize to get real results. When this is done, sabotaging of oil and gas facilities and systems would naturally end. We must know that the simultaneous development of both the agricultural and petroleum industry would lift the country out of economic strangulation and produce tons of millions of jobs.
Lastly, for the purpose of this piece, a problem we must take seriously and ensure its timely resolution is our economic relationship with all our bordering nations. The recent closure of the Nigerian border with Benin, Niger, Cameroon and Chad has opened our eyes to the whole lot of economic parasitic relationship we share with all these countries. It has become very clear that the concept of ECOWAS free trade charter has disadvantages to Nigeria.
Imagine the exposure of Benin Republic with a population of 12.1 million (6% of Nigeria’s population) being the 6th largest importer of rice globally importing about 1.9 million metric tons of rice annually worth approximately $936,122,000. The government of Benin are duly paid import tariffs for the imports and then by some means unexplainable, about 90% of the rice are smuggled into the “Big Brother Nigeria(BBN)” with no revenue accruable to the Nigerian government, our market become flooded with the smuggled products: the local farmers are literally forced out of business and government attempts to revamp the rice industry betrayed.
Not limited to that, Nigeria imports finished petroleum product into the country, the government subsidized the product and before you say “jack”, hundreds of trucks load of the product are smuggled into these countries on daily basis. Nigeria has been the fool, losing on all fronts; their economy is booming while we continue to groan. It is not surprising that the World Bank report on Benin Republic would aptly capture the country’s survival challenges as “Benin is vulnerable to exogenous shock: adverse weather conditions, varying terms of trade (cotton and oil prices), and developments in Nigeria- its main trading partner and the main source of its economic activities as 80% of Benin imports are destined for Nigeria. The economic recovery in Nigeria, where the recession officially ended in September 2017, fuelled growth in Benin”.
We cannot continue like this. We must produce what we eat and eat what we produce and would not under any guise, any longer condone any form of sabotage coming from any of those nations. We have closed the border for just few weeks and the result is unbelievable: our daily consumption of PMS and AGO dropped significantly, local rice gaining more recognition and processing capacity increasing nationwide, even crime especially banditry has dropped and our income through legitimate importation on an unimaginable rise.
We cannot continue like this: the borders cannot be permanently closed. The Regional Bodies, ECOWAS in particular, must return to the table; the spirit of the free trade protocols must be re-assessed. Countries cannot be turned into dumping grounds because of some unfavourable agreement. What becomes of mutual symbiotic economic relationship among nations? Germany is a big brother providing shelter for several nations surrounding it, yet none of those nations is taking undue advantage of Germany to develop. The EU agreement does not allow Italy, France, Portugal, Spain and others to negatively impact Germany’s local economy.
When the terms of inter border trades and relationships protocols between Nigeria and these countries are amended through the ECOWAS Parliament and relevant sub-regional bodies, the borders should be opened for mutual benefit of all. There are hurdles to be crossed, decisions to be made and actions to be taken before we reach the Eldorado, where we will altogether be able to say like Julius Caesar “Veni Vidi Vici” (We came, we saw and we conquered).
God Bless the Federal Republic of Nigeria!

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