AfDB President (4th left) with top government officials and leading industrialists at the 2023 BusinessDay CEO Forum.

To roar again, Nigeria must unleash an industrial revolution, says African Development Bank chief

“The day Nigeria wakes up and becomes a Lion King, everything will change for its people and Africa.”

Nigeria urgently needs to revolutionise its industrial sector to become an economic giant. This, in turn, will transform the lives of its people and Africa as a whole, the President of the African Development Bank, Dr Akinwumi Adesina, said in Lagos on Thursday.

Citing examples from Malaysia and Vietnam, he said this was doable.

“Malaysia and Vietnam have used aggressive horizontal and vertical diversification of industrial production to move from low-value to high-value market products,” Adesina said. “The result is reflected in the comparative wealth of the three countries. While the per capita export value is $7,100 for Malaysia and $3,600 for Vietnam, it is only $160 for Nigeria.”

For now, Nigeria is developing too slowly and far below its potential, he told an audience of top government officials, leading industrialists, and other stakeholders at the 2023 BusinessDay CEO Forum. He also appealed to Nigeria’s new president, Bola Tinubu, to revive the country’s comatose manufacturing sector and reposition Nigeria as an industrial hub.

Speaking on the theme ‘The Day the Lion Roared! Making Nigeria a Global Industrial and Economic Giant’, Adesina emphasised that Nigeria’s prosperous future could only be secured by strongly supporting the private sector to unlock wealth that would lift all its people.

“Nigeria should never be a poor country, and Nigerians are tired of being poor. Nigeria must move decisively from managing poverty to managing wealth, Adesina said. “The challenge is for the lion to roar. Then we will have the making of an economic giant…Industrial manufacturing can earn Nigeria ten times what it earns from oil dependence.”

To achieve this, he urged the country to implement the right policies, investments, infrastructure, logistics, and financing frameworks, driven by a highly skilled, dynamic, and youthful workforce. Adesina said this included closing the huge gap between policy ideas and action. He called on the Nigerian government to transform its ports and remove administrative hurdles to improve their efficiency.

“Ports are not military zones, they are zones of economic and industrial transformation.”

Adesina illustrated his position with the popular movie, The Lion King, in which the young lion cub Simba grew up to become the Lion King after his late father was murdered by his uncle Scar, ruling the kingdom, and restoring its glory.

The film itself cost $45 million to make, but by 2019 it had grossed over $11.6 billion, making it the highest-grossing animated film of all time.

Adesina, therefore, encouraged the country to be proactive and ambitious for its manufacturing sector by integrating it into global and regional value chains. This includes rapidly moving up the value chain in areas of comparative advantage and greater specialisation and competitiveness.

A well-developed and policy-enabled manufacturing sector, with export orientation, will spur greater innovation, industrial policy for export market development, and structural transformation of the economy, he added. “Instead of being consumed with conserving foreign exchange, the focus would shift to expanding foreign exchange through greater export value diversification.”

Adesina cited copious examples from Malaysia and Vietnam. According to the Bank president, while both countries had moved into “global manufacturing growth”, creating massive wealth and jobs for themselves, Nigeria remained in “survival mode”, still unable to replace its imports of petroleum products, despite being one of the largest exporters of crude oil.

He warned that Nigeria’s industries would remain uncompetitive if the country did not resolutely address the shortage and reliability of electricity.

The African Development Bank is investing heavily in Nigeria’s power sector. The investment will support the implementation of the Power Sector Recovery Programme. The Bank has committed $200 million to the Nigeria Electrification Project to help bridge the gap in access to electricity, and $257 million to the Nigeria Transmission Project to strengthen the grid and regional interconnections.

Similarly, the Bank launched the $20 billion Desert to Power initiative to bring electricity to 250 million people in 11 countries in the Sahel region, including northern Nigeria.

Desert to Power will create the world’s largest solar power zone. The initiative will build on lessons learned from successful projects already financed by the Bank, such as the Noor Ouarzazate solar power project in Morocco and the Ben Ban solar project in Egypt.

In his speech, Adesina also discussed how the African Continental Free Trade Area represents a huge opportunity for Nigeria to embark on export-led industrial production. With a collective GDP of $3.3 trillion, the African Continental Free Trade Area is the largest free trade area in the world in terms of the number of participating countries.

He spoke of the urgent need for rapid investment in digital skills for manufacturing, retooling of the workforce, vocational training, digitisation of industrial processes, and investment in digital infrastructure as well as the enabling environment.

The African Development Bank is helping Nigeria improve its digital skills. Partnering with Agence Francaise de Développement, the Islamic Development Bank, and the Nigerian Government, it recently launched the $618 million Investment in i-DICE, the Digital & Creative Enterprises Programme. The programme is projected to create six million jobs and add $6.3 billion to Nigeria’s economy.

The African Development Bank is working with central banks and countries to design and support the establishment of youth entrepreneurship investment banks. These will be new financial institutions led by young, professional, and highly competent experts and bankers to develop and deploy new financial products and services for young people’s businesses and ventures.

Adesina told the gathering that several African leaders were working with the African Development Bank to create youth entrepreneurship investment banks. He urged Nigeria’s new government to embrace the initiative, which he said would be “game-changing for Nigerian youth”.

The African Development Bank is working closely with the Nigerian Government, seven state governments, and the Federal Capital Territory to design these agro-industrial special processing zones, which will create at least 1.5 million jobs. The African Development Bank and its partners have already mobilised $520 million for the first phase of these zones in Nigeria.

“The day Nigeria wakes up and becomes a lion king, everything will change for its people, and everything will change for all of Africa…That future is already here. It is time to re-imagine industrial manufacturing in Nigeria,” Adesina concluded in his speech.

In an earlier welcome address, BusinessDay publisher Frank Aigbogun emphasised that Nigeria’s economy urgently needed to be revitalised, including the enthronement of a competitive private sector, to achieve higher and more sustainable growth rates capable of giving hope to the people.

“Our dominant youth population demands focused and steady growth,” Aigbogun said. “We believe that the leaders of today and tomorrow must be better prepared for the rapid and disruptive changes in the world we live in so that they can proactively create frameworks and collaborations that ensure the optimisation of the nation’s resources,” he said.

Other speakers at the event included Ralph Mupita, Group President/CEO of MTN Group, Osagie Okunbor, Managing Director of SPDC/Chairman of Shell Companies in Nigeria, Godwin Obaseki, Governor of Edo State and Umar Namadi, Governor of Jigawa State.

Obaseki identified the country’s dysfunctional education system as one of the biggest development challenges. “For us, it’s about people, it’s about developing talent and our focus in the last six years has been to strengthen basic education,” Obaseki said.

Established in 2001, BusinessDay is an influential daily business newspaper based in Lagos.  It has been a leading source of business intelligence and market-moving news in West Africa since 2001.

Click here to read Dr Adesina’s full speech.

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