Catalysing subnational IGR growth with the “One Kindred One Business” initiative 

Communal efforts dominated economic growth and development in Nigeria’s pre- and post-colonial periods. Town unions, religious groups, women’s associations, age grades and so on rallied to build community schools, worship houses, markets, and other social infrastructures and collectively owned enterprises benefiting virtually everybody. Apart from public infrastructure, some communities also offered scholarships to their academically brilliant ones as a collective investment to enable such beneficiaries to acquire better education, earn more income and return to support the ongoing development programmes and projects. Although the culture has not entirely waned, top-down and government-led development appears to have become dominant since the oil boom of the mid-70s. Government interventions using programmes such as the Universal Basic Education, which saw the government build several schools in many communities, slowed the pace of grassroots involvement in public infrastructure provisioning. Many communities still earn revenue from collectively owned business assets they put together. Examples include leasing market stalls, town halls, and public address systems. Some also collectively owned commercial buses. The key advantages of such a bottom-up participatory development approach comprise inclusiveness, which harps on the local people’s collective sense of ownership and decision-making, the opportunity for their creation of progress grounded on their recognized needs, and becoming a partner with the government in development. This partnership contrasts with the view of the government as a merciful father providing most of the entrepreneurship-supporting infrastructure. Unfortunately, the weak economic performance of most subnational economies in Nigeria and the underlying non-progressive motivations of many in political authority means that such full-bodied reliance on government might not help much. Grassroots-level intervention might be the new deal.

Imo State, through Kenneth Amaeshi, its chief economic advisor, a professor of Sustainable Finance and Governance at the School of Transnational Governance, European University Institute, and chair in Business and Sustainable Development and director, Scaling Business in Africa at the University of Edinburgh, is pioneering this new wave of intervention through its large-scale, grassroots entrepreneurship programme called One Kindred One Business Initiative (OKOBI). OKOBI is a model of bottom-up development which rallies the second layer of social relationships after the nuclear family to cooperate in profitable entrepreneurial activities. In most African cultures, the “kindred” comprise the combination of second and third layers of kin aggregation after the nuclear family. The assembly of kindreds makeup villages. At the same time, a collection of villages make up the towns. Under the model, kindreds identify ventures they can collectively set up and operate. The financing of such kindred-owned businesses can be through contributions by one or a few of their members or through borrowing as may be agreed. Regardless of the operational modalities and business financing arrangements, the primary offering of the OKOBI is the incentive for kindred groups to establish and manage at least one profitable business within the state. Once the kindred group meets the specified minimum threshold in the business readiness requirements, the government can use other incentives to enhance its chances of survival, profitability and overall success. Besides the improved earnings and employment opportunities, OKOBI drives large-scale cooperative entrepreneurship and production, combinatorially the fastest way to build capacity at the base level and catalyse economic transformations. Members of the kindred group quickly become expert entrepreneurs by participating in decision-making processes, consensus-building, risk management, business cost minimization, product marketing etc. Such healthy entrepreneurship mastery also incentivizes the replication of businesses. Nnewi’s unrivalled parade of a millionaire-per-kindred resulted from an alternate model – the Igbo internship model – which also quickly equips young interns with business management expertise at the early stages of their lives.

Again, the OKOBI model encourages kindred group identification and the development of comparative and competitive advantages. The intense desire to earn income often exposes neglected latent potential within communities. OKOBI, in some ways, is a form of entrepreneurial awakening for most kindreds who will now begin to scout for and discover the economic and business potential they possess. For instance, a kindred group that owns vast hectares of highly fertile land may find that the only thing they need additionally to create a cassava processing business is some credit to hire some tractors to cultivate cassava on its vast land. Consequently, all that such kindred would do is put together a proposal and relevant documents showing their ownership of the land and how much they can self-provide out of the entire financing requirements and make the submission to the government of Imo state. OKOBI would have successfully activated such a kindred group’s comparative and competitive advantages when the prospective venture came alive. Activating such comparative and competitive advantages is the frontal focus of the “one local government, one product”.

In addition to the activation of comparative advantages is the promotion of self-help and self-reliance. As explained, the pre-and postcolonial communities did not wait for the government of that era before conglomerating to help themselves build markets, hospitals, schools and other infrastructure they needed to succeed. OKOBI presents and facilitates such opportunities among kindreds to rely on their collective ability, resources and goodwill to enhance their socioeconomic prospects. But more than any other advantage, OKOBI strengthens the philosophy of the “aku ruo uno” [wealth owners take them home] prevalent in many cultures in Nigeria, particularly among the Igbo people. By investing and making investment decisions at the kindred group level, the wealth of the kindred reaches and helps create additional wealth in the home of the wealth-maker. This perspective is usually attractive to diasporans who are emotionally connected and keen on developing their communities.

Unquestionably, OKOBI is a super catalyst for subnational IGR expansion. First, because it is essentially a massive pro-poor socioeconomic growth programme, it not only banishes poverty in its wake but creates more taxable assets and income for the states and local governments to harvest. Therefore, if implementing subnational governments are successful with the programme, the limits to the abundance of exploitable revenue will depend on the efficiency of their tax collection institutions. Second, it is plausible to assume that the conversion periods for the government to start harvesting independent revenue from this programme will be considerably short as most kindred groups may not be able to embark on massive capital-intensive projects with long maturation. Low-income people dominating most subnational economies in Nigeria usually embark on business projects with very short payback periods. The favourable implication is the opportunity for state governors and local government chairpersons to have reasonably enough resources to plough back into the programme and provide good governance. Thirdly, citizens’ compliance rates will most likely shoot up primarily because of the increased earnings of the masses and an enhanced provision of business-supporting public goods. Fourth, implementing states will most likely attract international development partners who may ride on the back of the ongoing intervention to unroll other beneficial programmes and financing for their sustainability. These potentially additional impetuses will also expand and strengthen citizens’ earnings and the state’s independent revenue generation.

Although the OKOBI model and the one local government one product [OLOP] initiated in 2004 and currently championed by the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) have different objectives, they can seamlessly synergize to create even more powerful models of subnational economic growth and expansion. While the OLOP framework focuses on developing comparative and competitive advantages in a product for each local government, the OKOBI focuses more on economically empowering citizens at the most granular level beyond the nuclear family. For instance, in Katsina, SMEDAN using the OLOP model, supported members of the ‘Kayuiki community reputed for the production of ‘Kilishi’ to form cooperatives and consequently provided them with necessary entrepreneurship assistance such as product packaging and branding, marketing and other forms of sensitization to strengthen their advantage in the product. They also gave them some financial aid to buy the necessary raw materials. OKOBI’s successes may see the resurgence of family and kindred-owned businesses. SMEDAN may therefore ride on the back of OKOBI’s approach to drive its target products across local governments at the kindred group level. Undoubtedly, OLOP will be more impactful if it effectively leverages the OKOBI structure. State and local governments may consider this level of model integration for maximum impact.

In the same way, OKOBI can benefit from the norms of the long-standing Igbo apprenticeship system to support kindred groups in quickly building their entrepreneurial capacity. Like other businesses, kindreds venturing into entrepreneurship will do better when they have a reasonable percentage of the kin involved possessing the required expertise in the area. For several decades, the Igbo ethnic group leveraged the apprenticeship system to informally but rigorously equip young men with commercial, artisanal and business management skills through master-supervised hands-on learning-by-doing approaches. The rapid post-civil war recovery of the ethnic group and the meteoric billionaire replication of the Nnewi people were ascribable primarily to that. Kindred groups interested in setting up specific kinds of businesses may delegate some relatives as apprentices or interns to improve their practical knowledge of running such enterprises of interest. Apart from the human resources and entrepreneurship required for successful kindred-level businesses, is the challenge of business financing. The OKOBI project reassures kindred-owned ventures that meet minimum thresholds of formalisation, implementation of effective governance structure and some proportion of financing of complimentary support. The financial area may also be one of such windows that in-country and overseas diasporans can take advantage of to support their relatives and the community. A single or a combination of diasporans doing well can entirely or partially finance the project in the spirit of the “aku ruo uno”.

Finally, if subnational governments expect bumper revenue harvests, they also need to sow and nurture the seeds of economic growth. The faster the speed of economic growth, the larger the revenue the government can earn. OKOBI holds the promise and, with deserving push, can orchestrate economic transformations of unimaginable magnitude. Other state governments may need to begin to understudy and possibly adopt the programme early. OKOBI’s economic growth-powering potency will also exponentiate with the synergistic effect of OLOP and possibly the large-scale injection of the Igbo apprenticeship system into the model. It is now up to the chief economic advisor of the Imo State government currently driving this process to consider exploring the intersections of these three powerful entrepreneurship drivers and incorporate them into the fascinating OKOBI model.

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