The Managing Director of Multi-Trex Integrated Foods Plc,
Mr. Dimeji Owofemi, who spoke with journalists recently, says by not creating
the right environment for private enterprises, the government is giving
incentive to laziness. AKINPELU DADA was there.
How would say
government policies are affecting the commodity business?
Commodity business has an up and down price structure and
the Nigerian market is one market that defies every principle in the book; that
is, every economic principle. The economic principle of whatever goes up must
come down does not apply in Nigeria. I would say government policies are a lot
of the time responsible for that; the government is a lot of the time
hypocritical and pretentious.
We all know what is not right, everybody talks about it but
nobody wants to bell the cat. It is a country where I find it strange that
people who ideally will be treated as heroes somewhere else are treated as
zeroes here. You should be heroes but you are treated as zeroes.
For instance, the Nigerians that are in their private
businesses, I am not talking about people who are government patronisers, and
when I say government patronisers, Alhaji Aliko Dangote is not a government
patroniser. Anybody who is close to him will know how hard he has worked and
what he had done; he had taken advantage of government policies that favoured
what he needed to do.
Take for instance, when the government wanted essential
commodities, the government created the environment of essential commodities;
he (Dangote) saw that opportunity, he took advantage of it. What are essential
commodities? Rice, sugar, milk etc, and the Nigerian government killed those
businesses by policies that do not recognise that farming anywhere in the world
has to be subsidised by the government because it is food. Food security is
core. It is the beginning of any upheaval. When people can’t feed themselves,
at some point they will fight back.
And we are not saying dole out money to people. We are
saying create the environment for people to want to engage in productive
business. In this country today, if you want to lay tiles you will go to
Cotonou to hire the people who will lay tiles well for you. The people riding
commercial motorcycles (okada) are these artisans.
We create an environment that makes people not to work hard.
It does not make sense. If I can ride okoda and earn N400 a day, why should I
do tile work? So, the ecosystem exists in every industry or in every society.
But there is no inducement for hard work.
In the cocoa industries, take the export of the raw
commodities and the value addition and separate them; 70 or 80 per cent of the
raw commodity is shipped out in the raw form. I don’t need to explain to you
that it has consequences because there is a very clear example of it. Crude oil
that we take out in the raw form, while killing the government-owned
refineries. Why do you think it is different from other industries? What is the
benefit of oil to us other than that it creates other problems of its own? It
creates corruption as well.
So, if the government is giving incentive to laziness, why
should anybody else work hard? About 20 per cent of the crop is value addition.
The people that are involved in raw commodity export are mostly European
companies who want to keep their factories running outside of this country,
because in addition to them getting that incentive, there is double jeopardy
for those who are adding value to the remaining 20 per cent, because those
European countries also impose tax on anything that is not raw but that is
value added; so, you give them double advantage. You give them 10 per cent or
whatever percentage and we get charged about seven per cent for exporting the
value added product; so, there is already a 17 per cent gap; when you now look
at the people who are involved in the value addition, all of us are Nigerians.
So you support what
the Minister of Industry, Trade and Investment, Mr. Olusegun Aganga, is
insisting on concerning the Economic Partnership Agreement with the European
Union?
It is not Aganga, it is Nigeria. And other African countries
have started seeing the sense in what we are saying. The European Union
minister was here with his delegation because he has been hearing us working
against it. Why should we allow our borders to be opened again when we have a
flipper of opportunity to add value? They can see that Nigeria and other West
African countries are now generating revenue; they want to come and wait for
that revenue.
But they will be setting up packaging industries, everything
will be brought from outside of this country and they will come with their own
citizens to come and run it. In the days when Nigerian Breweries and the rest
of them started, there was none of them that did not have expatriates in large
numbers.
Those they called directors or technologists were workshop
officers in their countries. The person knows the limit of his power, he gets
the same salary he will get when he is there, but we get charged the salary
they want; so, it is a way of repatriating the so called investment.
There is a fear now
that if we have a change in government that some these policies you are
appraising may be reversed, what is your take on this as an industrialist?
We will not stop talking. It is no longer wise to leave it
to the government alone. If we were not making noise, the policies will be
reversed because some civil servants have been compromised, even as far as the
manufacturers’ association, but special thanks should be given publicly to
Chief Kola Jamodu, who stood his ground, and the reason is because he is coming
from this area. He has run industries before, industries that belong to foreign
bodies, and he knows what efforts to be put in for it to stand.
PZ Nigeria is still the highest income earner for the group
all over the world. Guinness Nigeria is also the highest earner. Now, what they
want is 100 per cent, because they have started coming back by acquiring
majority stakes again. How did Cadbury get to where it is now? You need to ask
more questions about the stories surrounding some of these things that
happened. There is no country in the world that has more human resource than
Nigeria and I am ready to prove it on any platform.
The year 1986 seemed
to be a watershed in respect of the cocoa industry, with the dismantling of the
cocoa board, the privatisation of government enterprises, deregulation and so
on. Actually, what did the nation gain through the Structural Adjustment
Programme?
We did not plan what would happen after the scrapping of the
cocoa board. We believed the Brentwood people, that was why I was saying the
Brentwood economy will not work in Nollywood, it is designed for Hollywood. The
Hollywood environment is where the Brentwood economy can work. You need another
category of modification to the Brentwood economy for Nollywood to operate.
What we got wrong is that the World Bank says we should go
and scrap our cocoa board just like the EPA is forcing us now, attempting to
force us with the promise that it will benefit us by just increasing taxes on
the existing poor people. Scrap your commodity board, you are subsidising by
using the commodity board, you are protecting them and shielding them, they
said. The mother and father of free economy or capitalism is America. America is
forever subsidising its farmers. They created the World Trade Organisation to
protect themselves.
Then again with the GAT, they created so many things to
protect themselves. When one fails, they will devise another one. What we got
wrong is that we never planned for the future. And not planning is to plan to
fail. If we scrap the commodity board, what will happen to the farmers? What
are the structures sustained by this commodity board or cocoa board that will
suffer if we scrap it? Do we have the alternative value structure to protect
this value chain? That we got wrong. Nobody asked that question.
The Nigerian raw
cocoa lost its export appeal on alleged policy assessment, what is the
situation now?
Everybody who set up finance companies at that time set them
up because of foreign exchange. And cocoa, up till today, is about 70 per cent
of the foreign exchange earner in the non-oil sector; so, everybody rushed into
cocoa; anybody could gather the bags. People saw the opportunity from the
supply point of view because they were in hurry to make quick money; you know
they were taking deposit at 15 per cent. The only way they can pay that return
is to turn the naira into foreign exchange, then bring it back and turn it back
into naira, that was the basis of forming the numerous finance companies at
that time.
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