EMMANUEL IJEWERE, one of Nigeria’s most eminent accountants and businessmen, has had wide ranging experience across banking, finance and agriculture. A past president of the Institute of Chartered Accountants of Nigeria (ICAN), the Institute of Directors (IOD), and the Nigerian Red Cross, he is the national coordinator of Nigeria Agribusiness Group (NAGB). He holds chairmanships and directorships in many companies, including Best Foods Group, Emson, Nigeria Agribusiness Group, Drum Resources Nigeria Limited, Apel Capital & Trust Limited, Countrywide Direct Mortgage Company, Kerildbert Holdings, Computer Warehouse Group (CWG) and Gemini Pharmaceuticals. In this interview with business a.m.’s TOLA AKINMUTIMI, he provides insight on a number of issues, including the Federal Government’s Economic Recovery and Growth Plan (ERGP) from a very broad perspective. Excerpts:
Let’s start with your appraisal of the government’s Economic Recovery and Growth Plan (ERGP). What do you think the ERGP holds that is different from previous economic development blueprints and how do you think the government could achieve its growth objectives?
It is a good concept, private sector-driven but government-managed. I don’t think much can be achieved through the plan until the fundamentals are put in place. The first thing we need to put at the side as a country is where our priorities are.
GDP is useless if it does not impact on the human beings in the country; [just] as oil money is useless if it does not impact on the lives of the people. My own thinking is that government has a myriad of problems but we need to prioritise the ones that will have positive impact on the others. That is why I believe it is a shame that not enough emphasis is being given to agriculture in our national economic development plans. Agriculture, of all the sectors of the economy, is the biggest employer of labour, it is the biggest provider of dignity to people, it is the biggest employer of keeping people and developing them where they were born.
It is the biggest provider of security to our people. So, it also provides the ability to economically develop the various rural areas. Unfortunately, this has been pushed to the background. So, the ERGP is a good one but the fundamentals are still not there. The real people who are involved in this sector are not included. The ERGP is not an inclusive arrangement. It is a brilliant idea for re-jigging our economy to find out where the problems are, but the ERGP did not drill enough. They called people to come to Abuja for six weeks for the Focus Labs. Yes, beautiful idea but the kind of people you are going to get in that place, a serious organization that is struggling to survive cannot have its chief executive to go and sit down in Abuja for that length of time. Now, what is going to be achieved by that? What is even worse is Abuja is one of the most expensive cities in the world. What is a company going to derive from spending money on transportation and accommodation there? But that did not in any way take away from the concept but I am just saying that some of the fundamentals are not yet in place. Government has not taken agriculture to where it is supposed to be at the grassroots level. What is the budget on agriculture? I feel very sorry for the Minister of Agriculture working very hard but what is the allocation given to agriculture? It is treated like any of the others. So, what is the priority of President Buhari’s government? We believe that if you create jobs in the rural areas, these same rural areas through what is happening in the Anchor Borrowers Scheme can develop themselves economically. In the process, those who had just one acre can go to two acres next year. Two, they have guaranteed people who would be buying from them as off-takers and by so doing they are encouraged to go further. Yes, they don’t have light today but by next year, with increased production and reduction in post-harvest losses, they have more money in their hands. They can now afford to provide solar energy in those areas. Those same people are able to send their children to school. That is economic development coming from the grassroots. But this one where the economic development starts from Abuja and stops at the gate of Abuja and does not go round the country is not economic development. So, the Nigerian economy must be taken globally and not with the ERGP’s approach which is up-down but rather, down-top approach.
When you look at the nation’s budgeting processes and cycles, the MTEF requirements specifically make it feasible to have impressive performance of capital budgets on yearly basis but we have failures of capital budgets due to political brinksmanship between the executive and legislature on the appropriation bills. As a financial expert, what do you think the legislators should do to fast-track the budgeting process on yearly basis?
Let me speak as a Nigerian and not a politician. The average member of the National Assembly as they have been portrayed to us, whenever they get the budget, the first thing they go for is: how much do I get directly or indirectly from the budget? Until such mentality is completely changed, nothing good can ever come out of the Nigerian budget. Secondly, we accept a situation where our country cannot develop until our infrastructure is developed. What percentage of our total income is directed to develop infrastructure? Then, you now look at it vis-a-vis the recurrent expenditure? Until we go to the nitty-gritty of the budget processes and tackle the problem of structural defects in the allocations to various sectors, we may not be able to achieve improved capital budget performance at all tiers of government in the country. Look at Nigeria globally, are we a rich or a poor country? Go to Europe and see how many Sports Utility Vans (SUVs) are attached to the ministries there. You cannot be talking about only legislators or others at the federal level alone. If a state governor, say Ebonyi governor for instance, is going to Abuja, the running cost is equivalent to N6 million or N7 million because of protocols and entourage that goes with the governor. These are the national wealth that could have been used to build roads, hospitals and help farmers. This is economics and the economy cannot be taken piecemeal. It has to be holistic. You start with the priority, lay emphasis on it and direct all policies towards your priority. There are more than 70 million people in Nigeria’s agricultural sector and you have one minister and minister of state for the sector. Countries that are even smaller than Nigeria have minister for agriculture, minister for state, minister for Livestock and other areas, to show how important those sectors are. But here, it is a different ball game. As long as we continue in this manner, we will continue to go round in circles. What is our position today and what future do we have? We have great potentials in this country. A lot of people are scared of going to agriculture today because it requires sacrifice with hard work. When they hear that some people, who are less educated than them in special places, like National Assembly, are earning what they are earning, [then] farming becomes discouraging. If the leadership in Nigeria is not angry, [does] not feel insulted or embarrassed by the level of the earnings of a group of people in a poor country, then the country has no economic future. There is the need for all of us to come back and ask ourselves a question: what do we want? And these are the major issues that translate into political agitations and the likes. I do know that if we end up breaking Nigeria into 20 countries with same attitude, the same thing will continue to happen in each of those 20 countries. In fact, they will go to war. That is my thinking of it.
Based on your experiences over the past decade as an industrialist and agro processor what do you think should form the fulcrum of policy initiatives that will attract private investment into the agricultural sector?
I believe we have started off that journey now and I commend the Central Bank of Nigeria’s initiatives and determination for championing the cause. They created the NIRSAL (Nigeria Incentive-Based Risk Sharing System for Agricultural Lending) and then came up with this idea of Anchor Borrowers Scheme (ABS). Yes, it is not moving as fast as we want it to go and that is because the infrastructure is not there yet. The infrastructure starts from the villages. What is the problem on the ground now is that each of those farmers is small, independent and they are scattered all over. Until we are able to bring them together in clusters we may not get it right. What I think should have been the first thing is a partnership with the local governments. I don’t need to tell you how efficient a local government is in Nigeria. How many of 774 local government areas are working efficiently that people can talk and recognize? That is where it should start from. Yet, every farmer in Nigeria comes from a local government. The government should be able to bring famers together as a cluster from local government level and make it easier for the CBN to penetrate them with these brilliant ideas. By the time the cheats who are in the seed business will come, it is over because that local government will ensure that the people get the right seed. Secondly, those who give fertilizer mixed with sand will stop. The funding is the last thing in agriculture and not the first. The grain should go to the farmers first for proper planning after which the money follows. It is not all about throwing money at the sector. No. It requires proper planning and monitoring. It is all about throwing science and senses into it and then the money follows.
In the last few years, there have been aggressive tax generation drives at all levels of government. Sir, what do you think should be done to improve tax revenue and the attendant benefits to tax payers?
In the first instance, the Nigerian tax law is that you don’t get taxed for what you don’t have. You must earn an income. I even want to challenge you to go to your family; meet all the young people in your family including extended ones who are looking for job. Those people cannot be made to be in the tax bracket because they have no income. Therefore, you need to empower the people. That is why I said, again, that empowerment is key to every development we need in this country. The poorest states in Nigeria are those that have good quality of land. But they have not empowered their biggest wealth called people. By the time people start working they will begin to pay taxes. You can never accuse someone for not paying tax because they don’t have job to do; they are not empowered and they are not qualified to pay tax. Government can upgrade people and turn them to responsible tax payers. So, if the state governments are able to discover people as biggest wealth they can have, then things will get better. With such, they will be able to collect a lot of money from them. For instance, Lagos State is unique, it does not have land but because it is an economic centre historically, it has been able to generate a lot of revenue. Not only that, Lagos has recognized the importance of internally generated revenue. They are even doing it efficiently and professionally. Other states can do the same. So, talking about how other states can do this, there is the need for their governors to change their mindset and get proper orientation as to empowering their people. It is high time they stopped talking more on the money they are getting from the federation account and focus more on how to generate revenue internally.
The Federal Government has projected 7% GDP growth by 2020 through the ERGP document. Do you think this target is feasible if the informal sector remains totally neglected as it appears today?
It is not achievable as long as the current attitude is been adopted to drive economic growth initiatives. There must be major economic revolution in our mindset for us to achieve that goal. We must identify that the people are the greatest assets a state can have. The Federal Government does not generate GDP, it is generated in the states. In making that statement of seven percent growth of GDP target for 2020, what input did the states have in making that projection and how are the states to grow? For the states, how many of their local government areas have they engaged in doing what will make the GDP growth target feasible? These are the real issues. The constitution, from where the ERGP derives its set up envisaged that development must start at the grassroots level. That is why they said let us have local government areas. Local government will be responsible to the state government while the state will be responsible to the centre. But that is not the situation today. Local government areas in Nigerian are virtually dead. They are there only when the elections are coming. Local government areas in Nigeria collect money every month. Go to any local government secretariat and ask what kind of projects they are doing. You are likely not to get people in their offices. Sometimes, they tell you that they want to provide jobs. What, with the jobs that they create for their family members? When you give them job in the local government, they don’t go to work except once in a week or in two weeks and yet you end up paying salaries on monthly basis. The seven percent GDP target cannot be achieved unless we empower our people more and more, including providing them education. Not education alone, their health is also very important as they say, health is wealth.
Finance October 27, 2020