The last time I checked, Nigerians in their numbers were earnestly awaiting the era when the acclaimed giant of Africa would be spotted on the world map as regards automobile industry.

The aforementioned quest is not unconnected with the recent deal struck by the Nigeria’s government and its German counterpart. It isn’t equally unconnected with the candid body language that accompanied the pact.

It would be recalled that on Monday, 3^rd September 2018, the Federal Government (FG) under the watch of President Muhammadu Buhari graciously signed a Memorandum of Understanding (MOU) with the Volkswagen Group with a view to developing an automobile hub in the country.

The two were reportedly to come up with an enabling policy framework on the proposed project. The epochal move was an offshoot of the recent visit of the German Chancellor, Mrs. Angela Merkel to Nigeria, precisely in Abuja – the country’s Capital city.

It’s noteworthy that under the bilateral arrangement, the automobile firm is expected to implement a phased approach in relation to assembly of vehicles down to positioning the nation as an automobile hub in the entire West Africa region.

Lest I forget, in regard to vehicles’ assemblage as mentioned in the pact, the government must take into cognizance that there’s need to go extra mile towards reviving the country’s dying pride if they are really ready to invest in the said sector.

As we might have forgotten in haste, it’s highly imperative to recall that some of these vehicles – particularly Peugeot products – were previously being assembled in Nigeria but the lofty activity has now regrettably gone into moribund.

This, therefore, implies that the FG is required to look inwards with a view to resuscitating and boosting the aforesaid practice, which is currently considered as a lost glory. In a bid for an automobile hub, they must make frantic effort to reawake the seeming dead foundation.

The pact equally includes raising a training academy in conjunction with the German government with the sole aim of equipping the upcoming pioneer employees of the impending industry with requisite skills as well as imbuing them with the needed industrial qualities.

Definitely, establishing an academy to train the indigenous prospective workers that would kick start the hub is a welcome development. It’s thus needless to state that the MOU included the key recipe with regard to the awaited industry.

However, the bitter truth is that such an approach is liable to collapse on arrival if the stakeholders involved failed to consider the essential factors required for its functionality. Hence, the parties in charge of the initiative must leave no stone unturned towards doing the needful.

It’s similarly pertinent for the government to acknowledge that such an academy deserves to be sustained in the long run. In view of this idea, the institute shouldn’t be utilized only in the case of the ‘pioneer employees’. Thus, it ought to be retained with a view to training subsequent intakes as well as upgrading the skills of those already absorbed in the system.

Recalling other clauses contained in the pact, it’s worthy of note that the FG on its part is to ensure that the Nigerian Automotive Policy, which is currently under consideration, gets a speedy approval from the apt quarters. The policy, though still in the pipeline, includes the gradual transition from the importation of used cars to the manufacturing and distribution of new passenger vehicles.

It’s not anymore news that overtime issue regarding policies has bedevilled most of the activities taking place in the country. Acknowledgement of this recurring decimal indicates that the concerned stakeholders are required to go extra mile in their move to ensure that the lofty motive of the FG is duly actualized.

It’s on this premise that I suggest the authorities involved painstakingly consider all the needed parameters as they prepare the policy. Every required factor, ranging from setting up the hub, training academy, in-service workshop/training, to working incentives cum environment, must be holistically looked into so that nothing absolutely would be missing in the process.

It’s really saddening to note that three years down the line after the pronouncement, nothing tangible has been done by the relevant authorities to walk the talk. Hence, the government must comprehend that the citizenry are seriously looking up to them.

The legislators need to be duly lobbied in a quest to witnessing a healthy deliberation as regards the needed legislation. In his words, an Adviser in the Ministry of Industry, Trade and Investment, Bisi Daniels disclosed that the government was committed to providing a conducive legislative environment for the production of automobiles in the country.

I deem it fit to advise that such a commitment must be fully put into action if the FG is truly determined to create an industry where Nigerians as a people could boast of production of automobile machines that can be presented as well as used anywhere in the world.

As regards the sealed deal, the Minister of the said ministry, Dr. Okechukwu Emelamah strongly affirmed that the MOU was a major step in the FG’s quest for a robust automotive industry in the country, hence assured that the government was damn prepared to achieve the tech-driven objective.

The gospel truth is that, everything centres on the political will that accompanies the quest. Against this backdrop, for the tour in question to arrive at the desired destination, the government must not claim ignorance of the fact that what’s primarily of importance at this point is to support the recently embarked journey with the required will.

This is actually the time for the government to genuinely support the already existing private-owned automobile hubs in Nigeria, such as the Innoson Motors and what have you, in a bid to ensure they excel in their respective activities that’s targeted to boost the country’s economy.

Inter alia, for a thorough emergence and sustenance of the industry in question, the country’s education sector must also be involved. Hence, our technically-inclined students need to be brought closer to realities. It’s appalling and pathetic to understand that our teeming graduates in the field of Mechanical Engineering and allied disciplines cannot present the mechanism that constitute main parts of an automobile let alone manufacturing them.

It’s no longer news that in recent times, successive governments had made various worthwhile and commendable moves but in the long run, end up not actualizing the object of the initiative, owing to their inability to accompany the approach with candid practical steps. It’s thus unnecessary to remind the government that it’s expected to make a difference by acting differently.

As the Buhari-led administration is ostensibly determined to create a technology-driven economy, it must do everything humanly possible to separate priorities from frivolities.

Nigeria has to really do more for us to build a promising future. In population, the United States has about 120 million more people than Nigeria. That is where any metric breaks down. I was just going through the profits of major US banks and I became intrigued: largely the profit of one American bank in mere 3 months can buy all the banks traded in the Nigerian Stock Exchange.

Bank of America’s profit rose 58% to $7.7 billion;  Wells Fargo’s profit increased 59% to $5.12 billion; Morgan Stanley notched a $3.7 billion profit and Citibank posted a $4.6 billion profit for the three-month period that ended in September, IN News summarized.

Nigeria’s most valued bank, GTBank*, has a market cap of about $1.6 billion. If you combine all of the banks, you will not get up to $6 billion which is well below the market cap of South Africa’s Standard Bank Group.

Sure, you cannot compare a $21 trillion economy with a sub-$500 billion economy. But we need to pay attention to these numbers to be motivated to do the needful. And that “needful” must include a fundamental redesign on how we deploy state resources. For all the entrepreneurial festivals happening in Nigeria, without foreign capital, we will not have these growing startups. If that is the case, do we need to change our tax code to make those who have money to invest in productive things in Nigeria?

Why am I writing this? The news is that Nigeria has $16 billion in domiciliary accounts (about $4.3 billion are retail deposits) in our banking system. That tells you that Nigeria has capacity but we are not deploying productive assets to ramp up growth: “Nigeria has an estimated $16 billion in domiciliary accounts of commercial and merchant banks, data from the Central Bank of Nigeria reveals. We assumed an official exchange rate of N410/$ based on NAFEX rate used at the Investor and Exporter window. According to data contained in the apex bank’s statistical bulletin, Nigeria had a total domiciliary account balance of N6.566 trillion as of March 2021 which when converted to dollars at the official rate of N410/$1, translates to about $16 billion.”

I am very confident that a tax system that rewards productive investment will release capital in the economy and in the process build up the economy. When people prefer to put their money in the bank instead of investing, we can assume that our system is not working optimally.

We invite the general public to attend Tekedia Capital Public Lecture this Saturday. This is an  academic event on how we use patterns and data to determine the next winners in Africa’s startup ecosystems. Tekedia Capital is built on the philosophical construct of Pythagoras which is that the world is numbers, and we use numbers to model sectors and companies that will thrive within our investment thesis. It is a kind of symphonic innovation where we look at many elements before we commit to support extremely young companies. 

Public lecture details as follows:

• Topic: Investing in Africa’s Next Unicorns – A Tekedia Capital Playbook
• Presenter: Prof Ndubuisi Ekekwe, Chairman, Tekedia Capital USA
• Date: Oct 16, 2021
• Time: 6pm – 6.45pm WAT

Venue: Zoom link  on this link

Whenever you have a setback, besides looking at the outcomes, spend more time on the processes that lead to the failures. The biggest failure is NOT fixing things that lead to failures.

Comments from LinkedIn Feed

Comment #1 – If you are not failing, you will not still have a good understanding of what success looks like, you acquire depth from your failings, and not your successes. Nobody thinks at the highest level when everything is fine and rosy, rather it’s when it’s bumpy and uncertain.

Comment #2 –  In the words of Winston Churchill “success consists of going from failure to failure with no loss of enthusiasm”.