Feature/OPED
Tinubu Must Solve That Power Problem
By Prince Charles Dickson PhD
Quickly last week, my office premises and environs did not have electricity, and a few steps from my office is the Jos Electricity Distribution Company. The company is one I did rate a four out 0f 10 which by any standards is fair enough. So, they were powering the office with a generator, yes, you heard me, generator.
And I have seen this scenario once or twice, but it just occurred to me that we are not well as a people. However, truth be told, worse things have happened.
A few years ago, the Bureau for Public Enterprise BPE sold NITEL, the nation’s elephant telecom company, to a building in Switzerland; it was a building housing a church, all the dance and drama. We soon let go. Just a reminder, it was called PENTASCOPE. Years later, the father of a white cloth-wearing former Honourable bought the NITEL House…The NITEL story remains a tale by moonlight, plenty of lies, half-truths, misinformation, propaganda, a potpourri of sorts.
How about the Steel Rolling Mill in Jos, Plateau, it was ‘racketered’ in that sweet-sounding word privatization. Some journeymen bought all the assets and renamed it Zuma. Today, the only functional thing is the housing estate. The factory and machines have long been vandalized.
There was that drama of the Daily Times, publishers of that old-time newspaper. Before I go far, a former Managing Director of the once pride of publishing told me, “Charlie, Daily Times is like a big elephant; everybody comes and cuts his/her own and goes away.”
You need to appreciate that statement in context; at a time in point, Daily Times had properties virtually everywhere Nigeria had a presence in the world. All that changed; what is left of the elephant was sold to some clowns, and the rest is history…the elephant eventually slumped.
Let me spare us the story according to Nigerian Airways, the Nigerian Shipping Lines, or our textile industry in Kaduna state!
Anyway, my admonition is on our power sector, the Buhari administration is leaving a sector comatose after promises that the power supply would get better, and indeed on some odd occasions, I and many Nigerians have enjoyed more than 8 hours of electricity. But don’t forget; it was not the norm; it was an exception. The President, his aides, and ministers made pledges but delivered very little in this respect.
I will put it in context, almost 200% increase in tariffs in 8 years, with more than 100 nations still paying cheaper for electricity, and depending on who’s statistics you are looking at, we have spent over N7 trillion on our power sector since 1999, with the bulk of that finding itself in private pockets.
We don’t have enough electricity but under the WAPP initiative to promote and develop power generation and transmission infrastructures as well as to coordinate power exchange among the ECOWAS member states. Nigeria currently supplies electricity to the Republic of Benin, Togo, and Niger.
The economic loss due to grid collapse is almost 3% of the nation’s Gross Domestic Product (GDP).
I recall the drama of Enron, a failed American company that was reckless in its use of derivatives and special purpose entities. Mr Tinubu, the incoming President, started the IPP project in Nigeria with Enron, then in Lagos. It is noteworthy that he was the first to challenge the monopoly of NEPA. He conceptualised the bulk purchase agreement. Obasanjo stopped the implementation. We wait to see what lies in wait and fate…
Put in perspective, with 12 Turbines, the Mambilla Hydroelectric Power Station is a 3,050 MW hydroelectric power project under development in Nigeria. When completed, it will be the largest power-generating installation in the country and one of the largest hydroelectric power stations in Africa. It is still 6 years away from the expected completion date of 2030 and costs $5.8 billion.
For those that did not know, the Mambilla hydroelectric project was originally conceived in 1972; it could advance only after 35 years when China’s Gezhouba Group awarded a contract to develop the project with 2,600MW installed capacity in 2007, all still na voicemail.
At 50 years old, Kainji hydroelectric dam is the oldest functioning power plant in Nigeria. Kainji is one of 3 major dams in Niger state. The others are the Jebba Dam (1985) and the Shiroro Dam (1990). A fourth dam is currently under construction at Zungeru.
The Federal Government, in February 2023, announced the preferred bidder for the concession of the 700 megawatts Zungeru Hydroelectric Power Plant for a fee of $70,000,251 per year for 30 years
We have blamed witches for power outages. We have since forgotten the Minister who resigned and the controversies surrounding all that power scams.
And then the many Chinese loans taken, yet we are on the same track; the Power Holding Company of Nigeria has been sold, and the drama continues. But if you know Nigerians and Nigeria, it is only a repeat episode, nothing new.
Most of the owners bought PHCN properties for peanuts. Owners that have no required expertise, distribution companies aptly called DISCOs that see the venture as new ‘oil wells’ dancing around our collective psyche.
Looking at the best efforts of the government or the DISCOs, I recall those days when we read the novel by Adaora Ulasi, many things we don’t understand. What captivated me then was not just the story but that title.
Yet, from PHCN to NEPA, one-time ECN for those old enough to remember. Now Distribution Companies, the power sector and these Discos repeat episodes of things we never may understand.
Why can’t we get 22 hours of electricity in a nation with so many resources both human and financial? Like how do we expect to get the desired megawatts with generating and transmission points that are run like Lugard lamps?
Only last year, a handful of men put the whole nation in darkness in the name of a power strike. No one cared about the loss of those hours that the nation was left in the dark. We still suffer high voltage—electric gadgets bear the brunt; no one is held liable, and then low current—you can barely see, so there is electricity, but it cannot power a bulb.
The transmission company people are doing loads of hard work, but truly it amounts to nothing when there are many questions and no answers; I agree that we are a difficult people; it is probably only in Nigeria that PHCN owes NNPC for fuel supplied, and NNPC has not paid for electricity supplied and state houses owe utility bills, while citizens that have not paid bills in years have power as long as there is the power to spare.
I do not need to lecture us on the benefits derivable to the Nigerian economy if we sort out our electricity palaver. I must state the solution does not lie in Chinese, World Bank loans or Private Partnerships but in a strong political will by leadership.
If and if only Mr Tinubu can lay the groundwork for solving the power problem, to address the energy palaver, to direct his energy to the octopus-like the Ajaokuta Steel Rolling Mills, just solve the power problem, posterity will judge him fair, but as it is—only time will tell.
By Prince Charles Dickson PhD
By 1983, the army had struck and aborted the second republic, but here we are, the 10th Assembly will soon resume, and it’s been 24 years of a hullabaloo democracy; many are not happy, but we are making some form of progress, there’s been no martial music.
Despite the heated controversies in Lagos and other places, the death toll as a result of gun-throttling ballot snatchers reduced, and the magic figures of the Kardashian states also have reduced. However, we still have a marathon on our hands, but sadly we are building on some shenanigan principles that don’t spell well for us.
I recall in our recent democratic journey, a governor that had won a second term, after being sworn in, blamed his predecessor for huge debts and unpaid salaries…and more. Someone had to tap him, reminding him that he was the predecessor.
In this dispensation, another governor simply refused to sit on the seat of his predecessor, and others would embark on a sacking galore, after all, only weeks to the end of the last man on the helm, there were loads of hiring, firing is then in order. I know that it is a lie that the Zamfara state governor declared N9 trillion in assets, but not to worry, many would declare outrageous sums (forgetting that we know their real worth), while others would dance the musical chairs, refusing to declare.
The block and freeze accounts group would be at it, accounts that would be elapsed after the initial gra-gra, where there are democracies, in many parts the governor would make statements banning payments of one levy, tax or union dues, but trust me, these payments would come back.
Most of the new governors have dissolved state councils, boards and parastatals. Some governors will demolish, either immediately or later, the new kids on the block must chop, new Heads of Service, and all those new commissioners etc.
This new administration has taken off with subsidy removal. A most contentious issue, one that every energy moron and fuel expert has an opinion on.
What exactly is deregulation? How exactly does this subsidy work? I have talked to government officials, petroleum marketers, a few ‘big boys’ in NNPC, and a couple of eggheads. The truth is that they do not know, or better still, they know but cannot explain what these terms mean.
All the grammar boils down to an inability of a system to solve a problem because a strong group of persons are benefiting from that problem. It also is an indictment reflective of the faulty planning by those in charge, that’s if they plan at all.
The government tells us that it cannot influence the price of the product since deregulation is the in-thing, but in common sense, no one has been able to tell us how fellow oil-producing nations have successfully dealt with their petroleum needs.
A friend suggested why don’t we go to Angola, Venezuela, or Brazil and just steal their blueprint? It’s working for them, let’s just stop these subsidies and deregulation grammar and deceit of subsidies and duplicate their success, localize it for the collective good of Nigerians, but of course, the term ‘collective good’ is an alien term to us. Insecurity won’t allow our newly old train systems to work, blue and green rails at cutthroat costs have not reduced the cost of transportation or eased people’s burden, our waterways are wasting, you are riding bicycles, car drivers would knock you down.
It is a sad picture of a society that has lost balance; the ruling class needs to be taught a bitter lesson; they need to be made to bleed, Nigeria’s live at less than a dollar a day while a few flaunt a nation’s collective wealth, so if the current administration is scraping subsidies, it should be supported, but it can’t get that wholesale support because of trust deficit.
No number of essays or commentaries can explain the impact of fuel, cooking oil and diesel on the economy; it’s like explaining the impact of constant electricity on national life. These are terms those in power do not seem to grasp; the reasons are way simple, too…one, they have big power-generating plants in their homes and offices. Two, some of them cannot really recall when last they were in a fuel queue and with millions of naira in remuneration and salaries, what do they care?
The NLC died a long time ago courtesy of an Obasanjo-inspired poisoning, aided by the greed of those put at the helm of its activities, its only panacea being strike and strikes.
Over two dozen fuel price increases since 1978, five times it was reduced minimally but hiked back almost immediately. From N8.45 in 1978 to N65 in 2009, representing an increase of almost 60,000%, the trend has simply continued. In 1978 when the first increase was announced, one of the reasons given was that a majority of petroleum users were using it for pleasure, and there was a need to bring discipline into society. Strange thinking, another reason was that N95 million was being spent a year on subsidies.
As of this year, we are talking in trillions; where is this money coming from, how does this subsidy thing work, how can you deregulate when your refineries are not working? How do you pay subsidy cash and still do crude oil swaps? Who can really explain the fraud called Direct Sales, Direct Purchase DSDP? I have not touched all the loops like bridging costs, demurrage, and forex fluctuations that marketers play with, minus selling at international prices to neighbouring countries. Even the commissioned Dangote refinery has not started working and is not starting anytime soon. You will see that wahala dey!
The top echelon of society cannot explain to Nigerians exactly the reason why we cannot buy fuel at an affordable price for three years in a stretch without scarcity. Not every Nigerian is a novice to the political, economic or social implications of oil pricing. However, the ordinary Nigerian suffers this failure and complacency of leadership.
Subsidies and deregulation mean the price will ultimately fall, and money will be channelled to other areas of the economy; in local parlance…’our leaders like to mumu us’. When the broadcast industry deregulated, we saw the instant benefits, the same applies to telecoms (although we pay some of the highest tariffs in the world); we saw and are still seeing the benefits. But once you hear these terms in the petroleum sector, it’s like it stands for the disappearance of the commodity, and when it reappears, its price increases.
Who are those responsible for the billions and trillions that disappear in subsidies, who are the few that want to punish the majority? All the best explanations of the government, until it is seen to be done, are more of hullabaloo.
Why is it that this policy to a large population of Nigerians is simply a tightening of the screw of poverty, no massive improvement of our colonial rail system, no free education or healthcare, no social security, or unemployment benefits?
Legislators neither here nor there, governors supporting with both sides of their mouth at variance, everyone on top supports, and every person underneath suffers it; in all the noise, the product disappears. Transportation fare increases, food prices skyrocket…a nation that has a disconnect between the ruled and its rulers.
The subsidy has become part of our transitions; if this government gets it right and can pull this off with a humane face, it will get a lot of things right, but the citizens need to play their part, the Yorubas say Ẹni tó tan ara-a rẹ̀ lòrìṣà òkè ńtàn: àpọń tí ò láya nílé, tó ní kí òrìṣà ó bùn un lọ́mọ. This means it is the person who deceives himself that the gods above deceive: a bachelor who has no wife at home but implores the gods to grant him, children. (It is self-deceit to expect the gods to do everything for one when one has not lifted a finger on one’s behalf). I can only say—May Nigeria win!
Nigeria has seen a sharp increase in unemployment over time, with a current estimate of 33%. All age categories in Nigeria are affected by a serious unemployment problem, with young people bearing a disproportionately high share of the burden. When people don’t have work, it makes life difficult for them and their households. Note that this causes labour migration, as people leave the country in quest of better opportunities and income sources abroad. Unemployment is one of the key reasons why its citizens migrate their labour to other countries.
Nigeria’s economy has struggled to produce enough jobs to accommodate this expanding workforce due to the country’s high population growth rate, which causes a large number of job seekers to enter the labour market each year. SMEs could be essential in reversing this trend and creating jobs, but they face challenges such as restricted access to capital, inadequate business support services, and a challenging business climate. Additionally, highly qualified individuals leave Nigeria in quest of better opportunities abroad, depleting the country’s talent pool and widening the skills gap in critical industries.
It is important to emphasize that because of the interdependence of these factors, a multidimensional and all-encompassing approach is required to address labour migration and unemployment. To mitigate unemployment and labour migration in Nigeria, a variety of actions can be taken. A few of these include:
➢ Job Creation and Economic Diversification: Nigeria is extremely vulnerable to variations in the price of oil because of its dependency on fuel. Through the promotion of companies and sectors other than oil, economic diversification can boost job chances and reduce dependency on a single industry. In Nigeria, it is crucial to increase the variety of employment options. The establishment and growth of various businesses and sectors can also encourage the emergence of new occupations and positions. There is a higher chance of employment for people when there are more businesses.
➢ Provision of Adequate Infrastructure: Infrastructure improvements have the potential to boost economic growth and draw in industries that can employ workers. For businesses to invest in and create jobs, they need a strong infrastructure that includes a dependable power supply, efficient transportation systems, and digital connections.
➢ Support for Small and Medium-sized Enterprises (SMEs): Encouragement of entrepreneurship and assistance for small and medium-sized enterprises (SMEs) can promote innovation, generate job opportunities, and boost economic growth. Agriculture is a sector with a lot of SMEs. It has a great deal of potential to boost food security, minimize rural-urban migration, and create jobs. By giving farmers access to funding, cutting-edge farming techniques, and market connections, production can be increased and jobs created throughout the value chain of agriculture. Programs for training, mentoring, and access to financing and business development services also support these businesses.
➢ Changes in Business Policy: The development of many successful firms, especially SMEs, has been hampered by culpable policies and deregulation laws. Business owners, producers, and other market participants take advantage of policy gaps to perform arbitrary functions. Therefore, reviewing and updating corporate policies, regulatory frameworks, and labour laws can help to foster a climate that encourages investment and job growth. In addition, employment prospects may increase as a result of streamlining administrative procedures, lowering corruption, and guaranteeing fair competition for all enterprises.
Conclusion
Although it is a difficult problem to solve, mitigating unemployment and labour migration is crucial for Nigeria’s economic progress. Another strategy for this development is to strengthen the institutions of the labour market, lower company costs by streamlining regulations and lowering taxes, improve the business environment, and improve education, safety, job accountability, and security. By doing this, employment opportunities will be generated, and the general public’s professional development will be encouraged. Lastly, the government’s main priorities for sustainable solutions should address societal issues, attract investment, enhancing skill development and business climate.
Emmanuel Otori has over 10 years of experience working with 100 start-ups and SMEs across Nigeria. He has worked on the Growth and Employment (GEM) Project of the World Bank, GiZ, and Consulted for businesses at the Abuja Enterprise Agency, Novustack, Splitspot and NITDA. He is the Chief Executive Officer at Abuja Data School.
By Kehinde Ogundare
Running a business in Nigeria can be an arduous task. Business owners face fierce competition as they strive to secure market share, acquire new customers, and enhance their productivity and profitability.
The business environment is getting more competitive. According to World Bank data, 97,988 new businesses were registered in Nigeria in 2020 (the last year for which numbers are available). The country’s rapidly accelerating tech sector provides further evidence of that increased competitiveness.
A report from McKinsey found that the number of startups in Nigeria and other African companies grew threefold between 2020 and 2021.
The growth of a business, whether it offers a product or service, is closely linked to its customer base. In order to remain competitive and retain these customers, it is crucial to use data-driven insights to inform business decisions and facilitate a successful customer experience.
Understanding data analytics
In the simplest terms, data analytics is about making sense of all the data that a business gathers and using it to help the business improve its decision-making or to gain insights into a particular subject or problem.
It enables entrepreneurs to make profitable decisions, drive innovation, anticipate market trends, and manage budgets. However, a report by KPMG that analyzed the usage of data and analytics in Nigeria’s business environment reveals that 56% of organizations in Nigeria base their decision-making on intuition rather than data. This shows that businesses are yet to grasp the true potential that data can bring to decision-making.
Another report highlights that, on average, organizations plan to spend at least N50 million annually to develop data and analytics capabilities, indicating the potential for businesses seeking to integrate these practices. However, just 16% of organizations have a defined role for their Chief Data Officer, and many merge data analytics responsibilities with the Chief Financial Officer (CFO), highlighting a talent gap.
Finding the right solution
A strong BI platform can gather data from across different software used by different departments, such as sales, marketing, finance, and inventory, to help the user make sense of the data through simple-to-understand charts, graphs, and other visual tools. This, in turn, facilitates strategic decision-making.
Zoho, for example, provides a robust BI solution that comes with self-service data preparation and augmented analytics. It has strong AI/ML capabilities, enabling users to use natural language commands such as “show me our revenue growth last quarter” to get charts showing just that. Zoho Analytics can also be embedded in any third-party software, so users do not have to log into a new app just to view reports.
In today’s world, where there is high competition for customer attention among businesses along with organizational operations driven by technology, data analytics enables a business to optimize performance and make data-driven decisions. Having real-time insights into how their business is performing and the current market trends can help business owners adapt to the fast-changing landscape and stay relevant.
Kehinde Ogundare is the Country Manager for Zoho Nigeria
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