Economic stability impossible without stable power supply – Mbisiogu – The Sun Nigeria

By Dickson Okafor

President/CEO of Blue Diamond Logistics China and Founder of Good Governance Initiative (GGI) Festus Mbisiogu, in this interview, spoke about the country’s economy, the importance of electricity supply, among other issues.

You were one of the special guests at The Sun Publishing Company’s 19th Annual Awards, what’s your assessment of this year’s awards?

I thank the Management Committee of the 19th Annual Sun Awards 2021 for improving this year’s award from The Sun Publishing Limited. The organizers and those behind the awards were on point in terms of organising, planning and executing the event. However, this year’s event was rich in the presentation and caliber of the winners and showed that there was no compromise on the selection model. That’s why despite my busy schedule, I left China to attend the Sun Awards. May I also use this media to congratulate my friend and brother, Chief Ebuka Okafor, Chairman and CEO of Vixa Pharmaceutical Limited, for being conferred with The Sun Industrialist of the year due to his contribution to national development. Therefore, this shows that The Sun’s annual award is purely on merit, which is why I commend The Sun Publishing Company for finding Chef Okafor worthy of the award. Indeed, Chief Ebuka Okafor is a kind-hearted man which he has shown through the Ebuka Foundation through which he is touching many lives in Anambra State and beyond. Thus, the Sun Awards selection committee has done a good job of selecting credible men and women whose footprints shine on the sands of time. The winners are Nigerians whose actions and achievements have gone on to positively influence the country.

During your recent visit to the Nigerian High Commissioner to the United Kingdom, Ambassador Sarafa Tunji Isola, you said that the poverty rate will continue to rise until there is a stable power supply?

As a former Coordinator of the Nigerians in Diaspora Organization (NIDO), Guangzhou Chapter, I had the opportunity to meet with Nigeria’s representatives across the world and the Nigerian High Commissioner to the United United, Ambassador Sarafa Tunji Isola. The ambassador is one of them. He is a worthy Nigerian and a good ambassador. Yes, he hosted me when I visited the UK. He knows that I have championed and advocated for a stable power supply through successive administrations through my non-governmental organization, the Good Governance Initiative (GGI). Earlier I sent SOS to the Federal Government for bad electricity especially the high cost of diesel to run my industries in Nigeria. Whether we like it or not, the state of electricity epilepsy in Nigeria is one of the factors responsible for the high rate of unemployment, poverty and crime as the majority of Nigerians are unemployed and the few businesses private cannot be maintained due to lack of power supply. So, to create jobs and reduce poverty to a bearable state, industries and manufacturing businesses that have closed due to a lack of stable power supply must reopen. And for them to reopen, the electricity must be stable.

As an advocate for a stable power supply in the country, you have echoed the dissatisfaction with the epileptic power supply in the country over the seven years of APC’s administration, how do you rate the administration present in its efforts to fulfill its campaign promises of stable electricity supply for Nigeriens?

It is unfortunate that a stable electricity supply is still an expectation in Nigeria, even though the current administration under President Muhammadu Buhari has tried in 7 years to ensure uninterrupted electricity supply. However, this government has done better than previous administrations in tackling the electricity problem in Nigeria. But we expect them to do more to stabilize the country’s electricity supply. The danger is that many industries retreat to Nigeria and relocate to neighboring African countries where electricity supply is stable. I am also affected by the trend as an industrialist with industries in Nigeria. Consequently, the lack of stable electricity supply and insecurity have hampered the free flow of food production and equipment in the country. The problem is not unique to Nigeria, but to some African countries that have driven the global supply chain crisis causing major spillovers in Africa. According to Human Rights Watch recently, the war in Ukraine has aggravated the continent’s food and insecurity problems. These countries are found in East, West and Southern Africa and are highly dependent on the region for imports of wheat, fertilizers and vegetable oils.

Are you saying that the Russia/Ukraine war and the Covid-19 pandemic have contributed to food shortage and insecurity in Nigeria and other African countries?

As an industrialist in Nigeria, the impact of this war on large-scale manufacturers is terrible. Recently, at my factories in Lagos and Owerri, we have witnessed many challenges as a result of this war between Russia and Ukraine. Before now we fought to survive due to Corona Virus Pandemic and then came the war between Russia and Ukraine even after what we have been through during Covid-19 Pandemic.

The lack of stable electricity supply has a great effect on the manufacturing industries in Nigeria. Nigeria used to import diesel from Russia and other countries around the world. Before the Russo-Ukrainian war, diesel or crude oil cost $0.4 per litre; it is N260. But due to Russia’s invasion of Ukraine and the cut in the supply chain, the price rose three times. So we now buy a liter of diesel 1.2 dollars. In my factory, we produce 15,000 liters of diesel per week. So if you add that in, we’re spending about $17,000 on diesel a week to keep the plant afloat. And in a month we spend $68,000 if you run the generator day and night. However, in a month we spend about 60,000 liters multiplied by 1.2 dollars. Normally before it was 10 or 20 thousand dollars, but now it is double three times. This is how the epileptic power supply in Nigeria has affected my business and other businesses. And for us, it’s hard to break even because we’ve downsized because customers are struggling to buy these products.

Is it obvious that the current administration might not provide stable power supply to Nigerians as it promised in 2015 and 2019?

Since the inception of the current government, I have consistently called for drastic measures to be taken to refresh the stable power supply in Nigeria. Yes, it is possible in the remaining year, this administration can improve the electricity supply. They can extend the palliatives to these industries and they can also arrange for the Transmission Company of Nigeria (TCN) to be concentrated largely in the industrial areas as these are the industries that really provide jobs for the unemployed Nigerians. I would like to reiterate my previous call for the government of President Muhammadu Buhari to declare a state of emergency in power. This long-lasting situation is already having a devastating impact on the industrial sector and on the people of Nigeria. Many texters spend their hard-earned money on diesel and fuel. Even the workers are not left out as they have to use fuel for their generators on a daily basis. That’s why I called for the development of a national energy policy that would serve as a social contract between the people and whoever emerges as president in next year’s election. The current government should do everything in its power to preserve this sector, because if the erratic supply of electricity continues or continues to grow, we may be forced to close shop. The nerve-wracking aspect of it all is that none of the presidential aspirants are talking about how they would improve the electricity sector. The situation has negative effects on small and medium-sized enterprises. We want leaders who will ensure that sustainable energy is maintained This is in its far reaching effect on development as many Nigerians in the Diaspora are keen to repatriate their money and invest in the country if the electricity problem is resolved. Part of the new national energy policy must contain the contract, whether social or legal, with the president in 2023 before he is sworn in. This document must be part of the oath of office he must take and must be duly recorded in our constitution and other national documents. He said if this is done, he believes that within the next four years, Nigerians will start to enjoy a stable supply of electricity as our industries are revived, massive jobs will be generated.

What advice do you have for the next administration that can pull Nigeria out of the current economic woes?

I urged the federal government to intervene with stopgap measures to allow manufacturers to manage production costs. Current diesel costs have made its production difficult as the price of diesel has soared to N720 and N730 per litre. It has never been like this before, therefore, it becomes extremely difficult to produce. And I don’t know how we will cope because the cost of running my diesel industries is high. For example, I spend more than 20 million naira every month to run my industries. Unfortunately, we are currently suffering a huge loss and we could lay off more workers. Why is the crime rate not increasing when there are no jobs for young graduates because there is no stable power supply to keep industries running. In my industries, we have less than 40%. 100 of what was before as product costs rise. According to recent complaints from distribution companies in the country (DISCO), they say they are running at a loss. And the revelation from the Bureau of Public Enterprises (BPE) shows that most utilities were technically insolvent, confirming that something drastic needs to be done in the electricity sector. Therefore, it is evident that these companies are operating below optimal level, hence they are overwhelmed by the challenges of the industry and they have no solution to these problems. According to the operators, because they are below both the price structure and the liquidity, that is why we have not yet reached a reasonable level in the distribution of electricity. Typical of all of Nigeria, the federal government has allowed DISCOs to take advantage of everyone and many Nigerians are paying for services they do not enjoy.

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