The concept of local content has been recurring in Nigeria’s socio-economic jargon for some time. In a layman’s manner of speaking, it refers to the addition of local/domestic variables to the production processes of any given sector of industry. Such variables may include human capital, material resources, financial investment, amongst others.
The importance of the policy, however, cannot be overemphasised. This is why the Nigerian Content Development and Monitoring Board (NCDMB), was established following the signing into law of the Nigerian Content Act on 22nd April, 2010.
Although primarily intended for the oil and gas industry which usually has a huge volume of foreign expatriate staff and technology, some of the responsibilities saddled on the board include but not limited to:
- Increasing indigenous participation;
- Building local capacity and competencies;
- Creating linkages to other sectors of the national economy; and
- Boosting industry contributions to the growth of Gross Domestic Product.
Thus, the agitation for local participation and involvement in the nation’s industrial sectors has built up over the years. From the oil industry to other manufacturing sectors, the government, labour unions, the civil society, and other stakeholders have regularly taken steps to ensure the participation of Nigerians at all levels of production as a means of engendering technological transfer and skills acquisition. The import of local content is in summary therefore, to add local input by way of skills and resources to the aggregate production output of a given industry. The benefits include employment and wealth creation for the indigenous people who are thus empowered to take charge in different capacities where their competences are suitable.
Of late, there has also been a low level agitation for local content implementation in the ICT sector. The telecoms sector in particular has been dominated by foreign owners and investors since its deregulation and privatisation. Of the four major GSM companies in the country the least of which counts 20 million subscribers on its hub, only one could be said to be locally owned. Even then, its top management cadre is peopled by foreign experts.
But the campaign has to face up to the reality that local entrepreneurs and investors may lack the huge capital outlay and technical competence required to invest in the industry. It is obviously against the backdrop of this situation that the Executive Vice Chairman of the Nigerian Communications Commission (NCC), Dr. Eugene Juwah, has challenged indigenous companies to brace up if they want to contribute meaningfully to Nigeria’s telecoms industry.
The sector has so far attracted over $40 billion investments and employed over one million Nigerians, according to the Bureau of Public Enterprise (BPE). To sustain this enormous growth, local telecom companies must develop financial and technical capabilities that would enable them deliver on projects. This is because multinational companies will prefer those vendors who can provide them with products, services and technical competence, as well as operational capacity to deliver such products and services where required.
Juwah called on them to develop the telecom sector on a sustainable basis over the long-term and provide more employment opportunities. According to him, local service providers to the telecom operators may need to improve on their organisational and coordination competence as well as capacity to efficiently and effectively manage complex projects.
The EVC’s call is timely and well thought out. The long term and sustainable future of the industry must necessarily be grounded on local input in both human and material resources. The liberalisation of the industry required that only investors who had the cash and the technical knowhow could venture in. But the transitional phase has to incorporate indigenous capacities and capabilities for the industry to be optimally beneficial to the country.
Reacting to recent complaints by local firms that they are being neglected by multinational telecommunications companies who prefer to sublet telecoms servicing jobs to foreign companies to the detriment Nigerian firms, Juwah, however, advised local companies and stakeholders thus: “we should not confuse local content with taking businesses from foreign investors and handing them over to locals without recourse to technical ability and financial capability within the value chain”.
Juwah, who also sought to know if actually, the local companies were being unfairly excluded from participating in the delivery of services within their capacities to the telecoms industry, advised the local players to develop economic capacities that will enable them deliver on major telecoms projects.
Investment in telecoms requires a huge financial outlay to take care of infrastructure, manpower, and other logistics, but the benefits of such investments may be slow in coming. This must have accounted for why the code division multiple access operators lack staying power in the Nigerian market.
The NCC boss therefore challenged local operators to ensure that they imbibe adequate skills and have access to finance, and also display the requisite commitment, in order to be taken seriously. According to him: “CDMA is dying because of lack of adequate investment capital”, “Telecoms is not for small companies, be capable or you will die”, he warned ominously.
It is hoped that the National Information Technology Development Agency (NITDA), set up to train local manpower for the nation’s ICT sector will live up to this role if the future of Nigeria’s telecoms is to become truly Nigerian.
Kaura writes from Kaduna
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