Industrial revolution is coming in Delta – Emu
Mr Kingsley Emu is the Commissioner for Commerce and Industry, Delta State. In this interview with our reporter, CATHERINE OGBOGU, he highlights the triumphs and roadmap of his ministry.
Essence of your ministry
My ministry is Commerce and Industry and as the name implies, it is our business to create an appropriate environment for industries to thrive, for commerce to thrive and for co-operatives to be recreated, reactivated and sustained. Government has in the past done a whole lot to develop small and medium scale enterprises as well as large industries.
In 2008, government formally launched a N1 billion joint venture funds for use by SMEs (small and medium scale enterprises) with Bank of Industry (BOI). Only about N200 million was drawn by those SMEs because they don’t have the capacity to access some of those loans for several reasons: they could not meet the conditions necessary for draw down; most of them don’t have both the discipline and requisite expertise to carry on with those businesses because of the dynamic nature of the operating environment. The major challenges of infrastructural deficit especially power, good network of roads, also hindered the ability of those who had the ability to turn them around effectively for profit. What we saw was a high rate of default in the loans.
So, when we came on board, we reviewed the performance of the fund through a well-attended stakeholders meeting with Bank of Industry (BOI) in attendance and chaired by His Excellency, Emmanuel Uduaghan. Major decisions were made which have shaped the policy decisions in the development of SMEs in Delta State. SMEs have become the backbone of every developing and developed economy like China, India, Singapore, Germany, United States etc. Where we do not have strong SMEs you have a challenge growing that country like in Nigeria where micro businesses account for 96% of industries in the country. In China SMEs account for 90% gross national product (GNP), 85% of employment, 70% of GDP, 70% of export, 68% of import, 66% of patent and 50% of taxes.
We are doing a whole lot in micro, as a matter of fact, of all the industries in Nigeria which is about 17.3 million companies, micro accounts for 96% of the companies while SMEs account for less than 1% of those industries. So, what that portends is subsistent development; it means that we would just barely manage poverty but we cannot grow. Only SME’s can take the economy to a good height. His Excellency has adopted a three prong approach of tackling poverty through micro, builds them to SME’s, and then big industries (Warri Business Park and Koko Free Trade Zone) by creating appropriate business environment.
Special role of your ministry
Where I play a major role is in SMEs and I can tell you we are doing 10 industries. We are doing four fish feed mills and six cassava plants. Now, we are looking inwards and identifying where we really have strength both within the aqua culture value chain as well as agro business. In Delta State, 40% of the state is water and we have 163 kilometers coast line. It means therefore that we can truly become a fish basket of the South-South and South-East and that’s what we are targeting but the major constraint facing that sector is quality feed. Where we have quality feed prices are highly unaffordable and where we have local manufactures, the waste level is very high resulting in a fish conversion ratio of 1kg of fish to 3kg of feed as against 1kg of fish: 1.5kg of feed prescribed. So profitability become suboptimal. Yet locally manufactured fish feed compare significantly in both the proteinous and carbohydrate content with foreign imports except that our farmers do not have the resources to acquire equipment with extruder component to keep the feeds afloat. What we are trying to do now is leverage on the fish clusters that we have in Uvwie, Asaba, Ika and Ubeji/Egbokoda as captive markets and produce at a significantly lower cost to deliver same quality at a low price. The other one is the six cassava plants. You know cassava is grown everywhere in Delta and in fact we are one of the highest cassava producers but at a subsistent level . lf we step it up, we can produce for industries. Our primary target products will be industrial starch and flour.
Impact on the economy
If you look at the economy, with the cassava value chain alone, we are capable of producing about 500 jobs in one location. If you have about one ton per hour capacity and you produce 12 tons in a day that means 8 pick-up loads of cassava tubers per day, then for 20 working days in a month translates to 160 pick-up loads and in one year an estimated 1,900 pick-up loads. Multiply this by six similar plants. You will agree with me that the community alone where the cassava plant is located cannot supply all that. The immediate solution will be massive support for the already existing out-growers association and creation of commercial farming in clusters to support production. So that means that we need to go back to agriculture, go back to farming, do cluster farming. That alone can create jobs for our youths.
I am not telling stories; we have N395m for this project already. As I speak, we have just returned from China on equipment inspection with the Bank of Industry and the consultants who will manage the project. There is collaboration and cooperation between and among my ministry and others to deliver on the three-point agenda of His Excellency, the Governor.
On small /medium scale enterprises?
What we do is tell cassava producers in various areas to come together, form one co-operative society that’s what we did. Through this means, co-investors would own 35% and outsiders 65%. The company would be self-sustaining and will run for special periods.
We are looking at entrepreneurship development; most of the graduates in our institutions have a challenge of vocational skills. We are training our youths through short programmes on a two-month training course in fashion designing and barbing. We just empowered 35 to 37 tailors (fashion designers) and gave them sewing machines and generators and for the men, we taught them how to barb and gave them barbing equipment. So we believe they will leverage on that and start up life from there.
For those who didn’t go to school, we train them on entrepreneurship skills on how to repair handsets and do call centres, we did that in conjunction with Globacom.
Solid minerals in Delta State
Delta State is endowed with a lot of solid minerals; we have Kaolin- can be used for medicine, paper industry, ceramic industries, and paint production; Silica-it is majorly raw material for glass production, abrasive and glazes; Clay- for production of ceramics, pottery craft, bricks insulators and paving slabs; Sand stone-for construction; Bentonite- for drilling, petroleum refining, decolorizing agent and processing of minerals; Oxides- majorly for glazes and pigments and Lignite- as a source of energy.
All of these minerals can be found in Delta State in commercial quantities, so we are working with raw material research institute, they know what we have and where to advertise for prospective investors to come and invest, so we work in collaboration with them. We are also attracting a lot of private companies by giving them incentives; we have a good industrial policy that favours investors, we give tax break, ease of land acquisition and a whole lot to ensure that they are comfortable. This year we would be having a trade fair in the state and would be going out for other international fairs to showcase what we have.
On Warri industrial Park
The first thing is to acquire the place (which has been concluded), second is to conceive the businesses that will be located at the park (mixed development), this was conceived even before acquisition as it was a major determinant for the size of land required and the Master plan which was done by Jurung of Singapore, a world class company. The business model was done by KPMG. Several reputable company both local and off shore have expressed interest.
Jobs for Deltans?
Though the companies would come in with their expatriates but Nigerians would benefit. The value chain; those who will supply, a whole lot of economic activities would be triggered off there. It is going to be massive, it is certain that the companies would bring in their key personnel to run some major areas but our people would also benefit from it through employment directly /indirectly.
Your take on 2015 elections
I am not running for any election. I have no interest in running for any election, but I am a staunch believer of who is going to lead our state and country. It is our fervent prayer that God should give us the right person to rule.
Which political party do you belong?
I am PDP live and direct and there is no shaking about that. I am PDP flesh and blood.
On Anioma for 2015?
We are looking forward to that; we are looking forward to Anioma leadership. Anioma is really looking good and that’s the direction for us. We pray the Almighty to grant us that favour to rule the state like other zones.
Your word for Deltans
We believe that the worst days are over; we believe that the level of sensitization, understanding and level of security are pretty high. We believe that the benefit of democracy is not only on road infrastructure and airports and all that but on human capital development. Some level of awareness has been acquired. We just enjoin Deltans to be positive in their criticism and be more contributive on how we can develop the state.