… Govt may not know that the solution to Nigeria’s tractorisation problem lies right inside Nigeria
Any investor or scholar investigating the problems affecting local manufacture of tractors in Nigeria would rush to inadequate capital, high cost of raw materials, inconsistent power supply, inadequate training, insecurity, poor infrastructure (especially bad roads), etc. They may as an afterthought include inconsistent government policies and competition from foreign competitors. Then, at last, they may add lack of government support. The scholar or feasibility report write may never know that the factors he placed last is now rather the number challenge.
A real study would reveal that Nigeria’s solution to its tractorisation challenge lies deeply right inside Nigeria. The expertise is ready, the market is there with 10,000 tractors per year, the companies to make them are willing and ready with huge investments and plants. What is not ready is any form of FG policy support.
What is facing the local manufacturers is said to be dumping. This is where the FG would sing Nigeria First or Made in Nigeria drive but would go abroad to invite tractor makers to kindly dump them in Nigeria. This would be without any consultation with the local manufacturers to know the market gaps to be filled or to know what to do to scale up their local capacities to meet the gaps.
The locals who take loans to invest would wake up to hear either of a plan to import tens of thousands of tractors from Brazil in a $1bn deal as attempted by Goodluck Jonathan and Muhammadu Buhari or $70m deal by Bola Ahmed Tinubu with the US makers or the deal between $250m and $684.1m with Belarus for same purpose at hand. In any of these, the local makers say nobody invites them to participate in the making so they grow capacity.
This seems to create a fierce background whereby the tractor manufacturing space in Nigeria is not different from the manufacturing space of any other sector in the country. Insiders say this is not isolated because manufacturers are suffering to gain any respect and appreciation from the Federal Government of Nigeria as people who have distinguished themselves in various sectors of endeavour.
BusinessDay findings reveal a frustration by manufacturers who think the Government seems not to have enough regard for local manufacturers and Made-In-Nigeria products.
One manufacturer told this Reporter that this is myth President Tinubu needs to work on. This he said is because the President is a product of the private sector and should be able to understand the dynamics that work around all of this.
Another source said Nigeria is struggling today because the nation does not respect the manufacturing industry which would have made Nigeria much better than what it is today.
On what the manufacturing environment is like, one Port Harcourt-based tractor manufacturer said the plight of local manufacturers cuts across board because what is happening to tractor manufacturers is happening to the others such as essential commodities. The government of Nigeria needs to believe in its manufacturers because the home-made products represent the brand that Nigeria boasts of which must be backed by the Nigerian Government.
They say that is why President Donald Trump of the US carries manufacturers along in engaging foreign leaders and he listens to their needs before engaging foreign presidents. He sits with commerce departments before sitting down with foreign presidents. They tell him what to tell foreign powers and the concessions to give.
Capturing their experience, Ibifiri Bobmanuel, CEO of Bobtrack Nigeria Limited, who has a plant in Port Harcourt as well as Lafia in Nasarawa State revealed how an East African country has been luring his company (the way Ghana ceaseless lured Innoson year back) to relocate.
Bobmanuel revealed the strategy, to give Bobtrack duty-free import of assembly parts for up to 50 containers at the first instance.
He said: “These are serious countries, but you are here in Nigeria to face a government that would rather go out and bring in tractors by other countries to kill the little investments you have built up in the country. It is really disheartening going into investment in Nigeria and you must have a strong resolve to press on.
“A case in study is where the FG would dish out up to $250m to buy Belarusian tractors. Have they even seen our Nigerian made tractors being displayed in eight strategic locations across the country, especially at the airports? Any Nigerian or any policy maker has an opportunity to go in our back to inspect our tractors and see the quality on display.”
The CEO and some others like have been raising this same concern from Jonathan to Buhari and now to Tinubu regimes, raising the question of whether the problem is regime-based or a structure-based one. It is a huge concern why none of the presidents ever invited the tractor manufacturers to discuss and ascertain the quality of what Nigeria has so as to know whether to rely on locally made tractors of not, and how to make Nigerian tractors better.
Responding, Bobmanuel said it is not about quality of locally manufactured tractors. “What we have in Nigeria is of very high quality far above what they are going abroad to buy. These are tractors able to pass the test in the United Arab Emirates (UAE), China, etc. It is solid enough.”
He once again told the story of their experience in China with Nigerian tractors at a trade fair years ago.
“We were invited to a trade fair in China and within hours, we sold off all the tractors we took there. We were almost shipping in more when they realized themselves and stopped us. Oh, a Nigerian company, exporting to China! That is a thinking government. Ours is the reverse.
“Our governments rather go to America, Belarus, Brazil, etc, to buy. We wonder if it could be a complex as a country. Our private sector is bold. See what the likes of Aliko Dangote, Adetola, BUA, etc, are doing. We have sector leaders.”
He made it clear that Nigeria would never achieve tractorisation by dumping or importing because all the hundreds of thousands of tractors imported into the country over the years have not enthroned mechanized agriculture because of climate differences, inferior types, poor maintenance, and racketeering by government officials.
He once revealed how foreign marketers bring low engines (horse powers) to pull big assets and thus breakdown frequently. “By the time their technicians and engineers fly in from far countries, the planting season would be over.”
He thus said the hope for Nigerian tractor problem is in Nigeria. “We have the local solution that is a world beater at Bobtrack.
“I have often told the story of how Bobtrack came into existence, which was when some of us were in the university in the north (Kano). We had interface with farmers there and saw the pains and the difficulties of 100% manual labour to produce food. They operated only at peasant levels. We saw pain and lack of capacity. We had a resolve in our hearts that we must mechanise agriculture in Nigeria. That is what gave birth to Bobtrack. That is what we are doing up north, and after almost 30 years, the situation has not changed because the people there need tractors to move away from manual farming. Farmers are still suffering because of absence of tractorisation.”
How tractorisation will push Nigeria to agric goldmine
Bobmanuel stated that most top leaders around the world including Dangote have stated that Nigeria’s agriculture is the next goldmine. He however said the golden era would not come by peasant farming or by manual agriculture by mechanization and tractorisation.
He said yield per hectare at the moment is very low due to manual farming and little or no fertilizer application plus wrong farming methods.
His words: “I was listening to Aliko Dangote at an event last week where he made it clear that agric is the goldmine for Africa. Even fools know this. We have arable land other continents do not have. What are we doing with it, nothing. Its no magic. Just common thinking and doing basic things. The land is there; people are ready to farm; and there is hunger in the land. Just help them acquire tractor or boost purchase of local tractors. That is all.”
He said auto manufacturers are also going through hell. “Every sector is suffering due to neglect of local manufacturers, despite policies that speak about promoting local products.
“You can imagine the amount of pushback Dangote Refinery witnessed at the beginning of the refinery project and even till date. He is struggling with crude supply, currency of transaction, distribution, and virtually everything. For you to be a successful private sector player in Nigeria, you must be ready for the what the regulators (government) will throw at you and what the society will throw at you. You have to be very strong. Government should look at these problems and find out what to do to help the private.”
He thus said Nigerian tractor manufacturers and assembly plants have been counting their losses since the Federal Government announced importation of tractors from Belarus with a $250m vote, which is said to be a part of the $681.9m tractor deal.
40,000 jobs lost to Belarus tractors:
The local manufacturers believe that had the FG voted such amount in a scheme with local manufacturers, that it would create not less than 40,000 jobs in Nigeria.
Bobmanue is one of the topmost manufacturers in Nigeria. He said k that if the president had bought half from home sources, it would create such high number of jobs and in days, it would have impacted the gross domestic product (GDP) of Nigeria.
The FG had announced through the Ministry of Agriculture a double deal with John Deare in California and Belarus to supply various numbers of tractors and implements as well as set up a base in Nigeria including repairs and training of farmers.
The local manufacturers however complained that such deals would have required partnerships involving the locals.
The deal with Belarus is expected to yield 2000 tractors per year but Bobmanuel said Bobtrack is able to produce 6,000, adding that Nigeria’s annual need is at least 10,000 in the next 20 years.
He said every serious country will work with their local manufacturers to ascertain what they can produce, find out what the country needs, and how these local producers can scale up to meet up.
“For instance, our wish is to export to the US but we have not been able to do it because they do not want outsiders to flood their country with foreign tractors and fight their companies but they will help their manufacturers to go out and dominate their markets, and countries like Nigeria will fall to it. The US will give a long list of things you must do first. It is protectionism.
“So, what we have is where your country will not help you (the local manufacturer), but it will now go and help foreign manufacturers. We hope we get to the point where the government will know what to do to local manufacturers.”
Bobmanuel, who is the President of the Rivers Entrepreneurs and Investors Forum (REIF), advised the FG to change strategy. “If not, the local investors may become a case study to foreign investors. The local investors are usually a benchmark to foreign investors to decide whether to invest in Nigeria or not. If they see local investors doing well, they will dream big to come to Nigeria. On the other hand, if an investor sees that setting up abroad would make Nigerian government to come with Dollars to buy large numbers, why would they come to Nigeria?
“It takes courageous investors like us to take all the blows and still remain in Nigeria and invest billions of Naira. We end up getting uninspiring behavious and signals by a FG that goes out to buy tractors and ignore local manufacturers.”
The local manufacturers however pointed out that every country has its foreign policy, and this is not to make another country great. “It is designed to project the best for the home country. Africans have failed in that important element of existence. Most third world countries are subservient to first and second world countries.”
Bobmanuel said what differentiates a country from first world, second world, and third world is policy alignment. “The day your leaders see it in what it is and realign their policies, things will change immediately.
“For instance, what policy does an ambassador posted to any country pursue for the home nation! It is this kind of feedback such as business targets, etc. It will not be how to promote the products of the host nation but to that of your home country. You will be meeting major buyers of your home country.
“In that case, Nigeria’s ambassador to Belarus would be selling Made-in-Nigeria tractors to Belarus and to other nations he comes across, not the other way round. Now, as strategic policy, what has Nigeria gained from the work of the Nigerian ambassador to Belarus? We as investors need a lot of educating so govt can know their role.”
The Bobtrack CEO said the tractor manufacturers have intensified efforts to get a window to brief Mr president on the matter. “We know that the FG will benefit even more than the manufacturers. If businesses do well, the GDP will jump and investment outlook of Nigeria will jump, too.”
He used the opportunity to rate the Nasarawa State Government on promotion of industries. “One can freely say that Gov Abdullahi Audu Sule, an engineer, has clear head on what he wants to do for his state. He promotes Bobtrack tractors a lot. Businesses need such belief and opportunity even more than cash to try their capacity. This helps a business to express its abilities. That is what the Nasarawa State government has done for Bobtrack to set up investment worth over one billion naira. We pray the State Government comes through with other promises it made so we can proceed.”
The CEO said attracting investors is no big deal. “It is just a decision, a choice, and the rest is to follow through, and you see investors come running in. That is what the Nasarawa State Government is exhibiting and benefitting from.”
Some critics have advised local tractor makers to go seek loans to boost their business, but they seem to get the dilemma of local tractor manufacturers wrong. The major complain seems to be that even when they obtain loans to produce, the foreign ones assisted by FG dollars would snuff out the local tractors in the market because such foreign makers get support from both their home country and Nigerian government.
The local makers also argue that locally made ones take into consideration the climate in Nigeria and Africa, something the foreign ones do not consider. There also no local technicians and parts to back up the foreign tractors, thus causing waste of tractors that scatter across the farms every year.
Reacting, Bobmanuel said his consistent outcry was not crying wolf of out of bad blood because he has invested billions of naira in the tractor value chain with his partners. He said he worked with National Agency for Science and Engineering Infrastructure (NASENI) to set up a tractor plant in Nasarawa State, saying he is too serious to be termed a critic. He said he is always putting his money where his money is, and that he is thus raising concerns that will help Nigeria because if the FG supports local tractor manufacturers, the agric revolution would come faster and food security would be achieved.
“No nation achieved food security through tractor importation when local brands are far stronger and more suitable than foreign ones”, he warned.
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