NO GROWTH FOR ANY NATION THAT BASED HER ECONOMY ON BORROWING – Dr. Emmanuel Iheagwazi
Dr. Emmanuel Iheagwazi, a Nigerian Businessman, philanthropist and industrialist, is the Founder and Chief Executive Officer of Climax Lubricants Industries Limited, a fast growing lubricant blending plant in Nigeria and West Africa. Climax Lubricants Industries Limited is one of the companies established by his humble self. CLIMAX LUBRICANT INDUSTRIES LIMITED was established to bridge the gap identified in the lubricant markets in Africa. In this exclusive interview with the team of Pan African International magazine, he speaks blatantly on what must be done to guarantee industrial revolution in Africa. Excerpts are presented below:
WHAT ARE THE IMMEDIATE CHALLENGES OF INDUSTRY TODAY IN NIGERIA CONSIDERING THE UNDETERMINAL ECONOMY?
Talking from my industrial background, if other countries have one or two economic challenges, that of Nigeria is above that. It is obvious that the economy is dwindling given commercial and industrial evidences. It is not out of place to call it a dwindling economy. However the issue of foreign exchange (EFEX) has created a bad effect to all investors in Nigeria and Africa as a whole, and as I speak, if what is happening continues, over 80% of industries will shut down. One could better imagine what will happen in the coming days. It is shocking that between six months to one year the rate of inflation we are having today is at alarming rate. We are competing with other growing nations like Europe, America, and today Chinese, Dubai etc. If you look at Nigeria, the exchange rate of dollar in Dubai since 20 years ago is 3.67 and it gives investors room to invest in their country. The same thing in China, dollar rate is between 6.7 and 7.1 but in Nigeria from last year 2022 to this year it skyrocketed from #380 to #800 (which is quite alarming) and no investor can survive at such rate. In fact, Nigeria’s economy is indescribable as at today, let me be frank here, even as deadly as this Nigeria situation is, the government continue giving investors triple taxation making industrial activities somehow unassuming. Honestly if I tell you how many governments’ regulated agencies that are at the door of this place you will agree with me that our challenges are indescribable. However, I read recently in the newspaper that the government is working hard to bring down the exchange rate to at least 500 naira to a dollar. I don’t know how truthful this is but time will tell. Like I said it is on paper, because writing and saying is one thing but implementation is another. Nigerians are earnestly waiting to see the changes reflect in the cost of economy. But more dramatic and disturbing is that from last week second week on November precisely a dollar was 1025 and as we speak now, a dollar is 1165 which is indescribable; if it continues then expect more industries to start closing down abruptly. You know what that mean!
WHAT IS THE FUTURE OF INDUSTRIALISATION IN NIGERIA AND AFRICA IN THE COMING YEARS?
As a passionate Pan African, I believe strongly that African economy will come back to normal only if we do the needful. There is still hope for Nigeria and African economy to shine nonetheless. If Africa economy must stand, paper works and all reports and assertions must be aided to metamorphose into practical actions and then, African leaders must as a matter of concern finds a passage to change Africa’s narratives and that’s when the continent can fly. It is not out of place to state that African leaders must have missed it out from somewhere in the passing years but harnessing efforts to form pragmatic synergy will not just revamp African economy but will largely give Africans the needed economic relief and reliant. Missing out somewhere is one thing, accepting to be redirected is another – it’s the later that embedded wisdom. Let African leaders redirect their steps. For African narratives to change, the leaders must talk Africa, see Africa and desire Africa to come out of economic quagmires by proposing and implementing policies that will eulogize the continent always.
Looking at other countries for example Asia continent, it is the leadership that formulates policies that grow their continent and that brought them to where they are today. There is hope for Africa to rise to the top, remember economy depends on what you have on the ground and Africa has all the resources that can be put together to make Africa great.
IS THERE A FUTURE OF DIRECT FOREIGN INVESTMENT IN THE NIGERIAN AND AFRICAN ECONOMY?
Looking at what the government is saying on paper but practically, what is happening is far away from government paper work. There is no match whatsoever. No matter the journey distance, there’s always a starting point, and the sweetness of the food is in the eating. The investors and several other industrialists that are at the receiving end of the government policies can say precisely the taste of the food prepared by the government. There’s a future in Africa – let me tell you Africa will be the future Asia. If the Chinese were to have the kind of raw materials we have in Africa, I lack words to describe how large they would have been. All we need is the orientation of African leadership.
WHAT BETTER COUNSEL COULD YOU PROFFER TO THE PRESENT ADMINISTRATION IN NIGERIA ON INDUSTRIAL POLICIES?
Great people are not born, they are made! No one writes a book without another man’s references. The government is already structured to have several advisers. These advisers are meant to advise the president on differ areas of governance. For instance, if we are to have an economist as a special adviser to the president on economic matters, the president should at least give them enabling environment to function without hitch. My council is brief; square should not be pegged in a round hole. Removing currency regulating policies at the instance of swearing in of the present administration has created enough kiosks and wound that only God can heal. That to me was an expensive misplacement irrespective of any assumes or perceived panacea at a time. When the dollar was at #460 at government rate the black market was about 600 at that time. When he tried to match them together to bring them to #750 it has gone to #1100. The future of every economy depends on the government. Honestly he made a mistake – there are things you don’t touch just like that, if I were him I would have reduced the exchange rate or keep silent about it at that time. Touching that rate that time has escalated into many untold and indescribable hardship and all that they are doing as at today – none is yielding result. They are key things that matters in economy that must not be touched except something has been put in place before an outright action can be exercised. Like the issue of taxation and custom rate. But any country that is after revenue collections from industries, the bigger industries cannot invest in such countries.
Recently, I read Congress meeting report on why African industries are not growing and their conclusion was simple, precise and amazing, that any country that base their economy on borrowing can’t and won’t grow. When they borrow they place taxes on their people and more recently in Africa, though worrisome is that they have increased their tax collection percentage index to further inflict pain on the tax payers. This action oftentimes kills the economy. When any industry manufactures any item under such percentage, exporting them becomes a mirage. With this, we can’t in any way become economic leaders in Africa. When your taxation is high and all rates on the increase – such environment is not conducive for a growing business. You can’t be the head economically in Africa when your taxation and all rates are high.
And if the government creates such avenue where industries can operate with considerable incentive the way the Chinese did in those days, they gave incentives to companies to operate in their country, export and to produce for the locals – things became relatively cheap. Then external people from outside the country will come for patronage and these are the only ways you can create economic balance and the effect will be felt, seen, and benefitted by all. By such time, you start to see an increase in your taxes to get revenue then because of the number of industries at the time, the little increase you make will generate more than expected and that’s why the GDP growth in China is in the increase. In every two houses in China there is a factory.
A policy that will encourage manufacturing is all we need in Nigeria and in Africa as a whole – this is my take on that! With incentive for importation, Nigeria can become the China of Africa, they should remove burden from the manufacturers and the people.
AS THE CHAIRMAN OF PAN AFRICAN INTERNATIONAL, WHAT ARE YOUR EXPECTATIONS OF THE PAN AFRICAN INVESTMENT CONFERENCE IN SIERRA LEONE IN 2024?
By the grace of God our expectation of the Pan African Investments Conference in Sierra Leone is going to be the highest of it all because it’s going to be a time to open the eyes of Africans. We are going to make sure by God’s grace that the kind of innovation that have taken the global economy, especially the Asian economy to where they are, we are going to make sure that we are commencing the same way in Africa. As a matter of fact, it’s not going to be Sierra Leone alone, we are going to industrialize African citizens.
I believe that God has induced potentials on Africans; the people that will make Africa what it should be are also Africans. The only identifiable problem here is that there are eagles moving among the chicken – because opportunities has never given them wings to fly. Many may think that all of them are chickens when given the opportunity to fly – you will distinguish the eagle from the chicken. By this conference, we want to fish out those business giants in Africa and form synergy to do the needful. We are now soliciting to all our leaders in Africa to give to us equal opportunities they’ve given to Asian investors and European investors – we promise to give them uncompromising better result. It’s going be a time of transiting Africans from consuming to industrialization. By then, you’ll see that the world would be depending on Africa – I tell you, we are coming up again.
IS THERE ANY INEED FOR AFRICA INDUSTRIAL REVOLUTION TO BE ABLE TO COMPETE FAVOURABLY WITH OTHER ECONOMY?
Honestly that is what we are championing! If you look at what is happening in Asia, America and Europe – what they needed for their industrialization, they took it from Africa. They can’t use those materials here because the moment they do that economy will go from them. This time around, we are going to take the bull by the horn. Africans are largely working in those industries abroad – but we are working out modalities that will return our expertise from foreign land to contribute their quotas to the building and development of African industrial hub within Africa. This event is designed to make Africa self-reliant. Various parts of Africa should be known with a particular product produce, used and marketed by them. There are minerals resources that are known better than others and this will be put into use. We can and we will continue to industrialize Africans to move from one level they are to the level God want them to be.
PAN AFRICAN INTERNATIONAL IN 5 YEARS!
Well, with the way we are going, in a short term plan of 5 years – Pan African International will be the visionary of Africa. What we want to do is something that will transform the whole of Africa for Africans. We are going to carve example, as we are commencing with Sierra Leone, we will tell the president of Zambia to go verify it in Sierra Leone, when we finish in Zambia we will tell the one in Gambia to go verify the one in Zambia. All that the Asians are doing in African soil, Africans can do it better given practicable passage.
