Richard
Hargrave is the Managing Director, Dizengoff West Africa (Nigeria)
Limited. He shares his views on trends in the Nigerian economy.
How long have you been in Nigeria?
I
first came to Lagos in 1978; from 1978 to 1982 we were managing what
was then known as JSK. I left in 1982 and came back in 1986 for Sniff
Crime Picture Merger. I left and went to America and Japan before
returning to Nigeria in 1997. Since then I have been in Nigeria. So, I
have been in Nigeria for quite a while and I am enjoying Nigeria a lot.
As a player in Nigeria’s agricultural sector, how would you rate it?
It
is an incredibly important sector, and Nigeria needs to be serious
about it. The country is blessed in terms of land, climate, and many
other things. Nigeria should be the leader in agriculture. I think
government should not be in the business of agriculture. Instead, it
should focus on the infrastructure essential for Nigeria to grow more of
its own food, government needs to be focused on assisting in building
infrastructure to help the private sector to build a successful
agricultural sector.
One of the
frustrations of government, which is a difficult challenge, is having
its plans and initiatives for farmers abused by speculators and all
kinds of dubious characters. For example, the non-agricultural sector
can go on with 20 to 25 per cent interest rate, but it is impossible to
achieve development in agriculture with such a rate. The government has
to provide loans of low interest rates for farmers so that they can
invest in land, crops and equipment.
The
world is running out of arable land and water to make sufficient food,
but what we have here is sufficient arable land, labour and water to
make food. So, there is huge opportunity in Nigeria.
How best can the sector be improved?
It
is not all about trade. We must keep enhancing the skills of our local
people here and try to improve them. We are also looking at the value
chain, from land preparation up to processing at every point we want to
see value added in the production process. In this way it gives us an
integrated approach in solving the agricultural problems and this is our
trend.
Agricultural produce such as fruits and tomatoes often go to waste. How does this affect the economy?
I’m
loyally becoming a major player in the agric sector in Nigeria. We are
committed to building the world’s largest tomato manufacturer.
Currently, we are probably the best tractor suppliers in the world. We
are not into the business of selling low quality, insufficient tractors
that can do the job. We need to buy the right tractors for the farmers.
We are doing the right thing and the business is good.
Talking
about how agriculture impacts the economy, I will give you the example
of Kenya. Kenya has become the world’s third largest supplier of flowers
in the whole world. We supplied to them 80 per cent of what we had.
Twenty years ago this business did not exist in Kenya but they have
become the third largest, now bigger than Holland which was the second
largest supplier of flower.
That is
what I want to do in Nigeria; I want Nigeria to become the largest
supplier of tomatoes in the whole world. I don’t just want Nigeria to
provide tomatoes for his own people; I want them to export tomatoes.
Has government policies had an impact in the sector?
Yes,
of course, it affects every business; from business man to business
man, industrialist to industrialist, government needs to do something
about the cost of money in this country. You cannot build an economy in
any private sector with 25 per cent interest rate. It is not possible. I
understand the challenges of government and Central Bank. But the
policy which is working in the country is creating unemployment. We have
four million graduates a year who go into the market place but can’t
find a job, that is 40 million graduates in 10 years. They need to find a
way of putting employment in the hands of people.
Are you partnering government?
Yes,
federal and state governments are our customers as well as the private
sector. I think the view that government is not being positive in
getting its hands out of the business of agriculture is definitely
incorrect. For instance, look at the business of telecommunications, I
came back to Nigeria in 1997 and there were about 50,000 Nitel lines,
but today there are about 110 to 120 million lines accessible and all of
them, which are all private communication companies, are working, why?
Government is not involved. There is no business that government places
its hand on that works; the same will happen in agriculture, the same
will happen in power. The government knows this and they understand it.
The change is difficult and it takes time because of different
conflicting forces and priorities. The earlier wealth creation gets into
the hands of people and leaves the hands of bureaucrats the better, it
has happened time after time, in one country after another. This is what
Nigeria is trying to do, one step forward and two steps backwards but
it must surely happen.
What would you say is the impact of sub-standard tractors on mechanised farming in Nigeria?
If
you import tractors that are not suitable for the land here, first the
farmers will produce at a very high mechanisation cost. They are going
to have breakdowns, buy spare parts and have downtime.
They
will incur a lot of expenses beyond their budget, and therefore they
will fail. Second, most of those tractors cannot really be used by
farmers because the hiring agency that will give the tractor to the
farmers might not have them because of breakdown and they will not be
available for small and medium scale farmers. This in itself is pulling
down agricultural mechanisation, which should actually be improving for
us to have sufficient food production.
In
Nigeria, you have a lot more rain and the soil is going to be heavier.
You need a tractor that has the right tyres and the right gears if not
the tractor will not work. Rather it will break down. If this happens
there will be no technical tool available for the farmer. I can take you
round this country and point out 2000 of these tractors imported into
this country, one-week-old and never used. They come from China, India,
Pakistan and they do not work. They are not made for the conditions
here.
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