Housing delivery: Exploring local content to reduce pressure on forex
To say local content is a growth factor in any economy is to state the obvious. Apart from optimizing the use of materials that are sourced locally, it also empowers local professionals; enhances local productive capacity; increases gross domestic product (GDP); and grows the economy, hence the need to explore and encourage its use in housing delivery, especially now that foreign exchange for imports has become a major challenge, writes CHUKA UROKO
Such a time as this, when foreign exchange (forex) is not only scarce but also restricted by government authorities, the need to explore local content in building materials for housing delivery cannot be over-emphasised, more so, as such action has the capacity to reduce pressure on forex.
The downturn in the economy arising from the free-fall in oil price at the international market, high inflationary trend and the weakening of the local currency, is prompting Nigeria to think diversification of its economy into growth sectors such as agriculture, mining, manufacturing and housing.
For too long, the housing delivery in Nigeria has been a function of assemblage of imported materials such that it is estimated that over 80 percent of the materials used in housing construction is imported into the country and in the construction industry generally, more than 70 percent of the big ticket contracts and construction jobs especially for roads infrastructure, go to foreign firms.
Nigeria has developed a local content strategy, but unlike its oil and gas sector counterpart, local content for the Nigerian built environment sector in particular and the construction industry in general, is still a struggle, which is why only a few industries and companies operate on the strategy.
As a quantum of composite value, either added to or created in the Nigerian economy through a deliberate utilisation of Nigerian human and material resources and services, the Nigerian content strategy promotes the use of locally sourced materials in production and operations.
The push for a local content remains more strident in the built environment sector probably because Nigeria has always been listed among the most expensive housing markets globally and one of the causes of this is traceable to the cost of materials and, to a less extent, the cost of labour.
Operators in this industry are saying that in the face of the country’s dwindling oil revenue and the recognition of housing as one of the growth sectors of the economy with capacity to enhance national income through job creation, there should be an act or law which should compel builders, estate developers, and sundry investors to patronise locally produced materials in their developments.
“There is a need to focus attention on local content in the provision of housing, particularly now that the emphasis of the government is on the diversification of the economy,” Moses Ogunlewe, a town planner says, adding, “specific attention needs to be paid to the values and benefits in the production, application and promotion of indigenous materials of all types; the various resources such as soil, timber and other solid minerals that are available in the country can become materials for housing development.”
Quite a good number of companies are engaged in the manufacturing of building materials and these include- Abba Aluminium Product in Rivers State; Abuja Glazing Company Limited, Garki, Abuja; Adeb Aluminuim Product Nigeria Limited, Ikeja, Lagos; Adegoke Steel Industries in Lagos; Alo Aluminuim Manufacturing Company Limited, Awka, Anambra State; Alucon Building Product Limited, Ikeja, Lagos; Aluminium Fabrication Company Limited, Lagos, among others.
There are however, only a few companies involved in the production of building materials using locally sourced materials and indigenous human resource and in this class are found Nigerite Limited, Fountain Field Company Limited, and West African Ceramics Limited (WACL).
Whereas Nigerite, the premier building materials manufacturing company that opened for business in Nigeria in 1959, is a leading light in roofing materials and other housing solutions like cladding, partitioning, flooring and steel trusses, WACL which started serving the needs of building material industry in West Africa since 1994, is a phenomenon in the manufacturing of ceramic, vitrified and roofing tiles.
At this stage of Nigeria’s development, it should be a global leader in the export of various types of building materials. The National Housing Policy of 2011 has as its core goal to hasten the development of appropriate capacities to achieve sufficiency in the production of basic building materials and components of acceptable qualities from local sources.
Interestingly, however, Nigerite has lived up to expectation in giving Nigeria and its people an array of products and solutions that have been applied at various times and places, changing the skyline of individual homes, institutions’ offices and developers’ estates.
“Nigerite has been involved in the production and manufacturing of many quality products through research and innovation; the new Kalsiceil ceiling sheets and Solo Xtra roofing sheets are the outcome of our innovative thinking as a complete building solutions company,” says Victor Jolaoso, Marketing Communications and Research Manager.
From the company’s products portfolio are Drywall integrated building solutions, Crown Tile roofing tiles, Siniat boards (plaster boards), NT Fascia boards, Kalsiceil embossed and plain ceilings, Allur Shingles, Gemstone, and Fibre cement corrugated sheets.
For WACL and its management, local content is not just a production strategy, but also a creed. It is one of the few indigenous companies, whose operation from sourcing raw materials to the processes of delivering the final product entails the utilisation of local contents in terms of value creation in the economy, systematic capacity development, and the thoughtful use of material and human resources locally sourced.
To save the scarce foreign exchange, create jobs for the teeming unemployed and help the nation’s foreign reserve. Government should support companies like these—Nigerite and WACL— and their products given all the recognition and patronage they deserve for housing delivery.
The missing link here, perhaps, is lack of awareness and enlightenment because unknown to quite a good number of commercial and individual home builders, many of these locally produced building materials are of better quality than the so-called imported materials.
“We are a young company and so, the awareness about our company is not much yet. A number of organisations have invited us and we have also contacted people to interact with them. An estate developer came here sometime ago and could not believe what he saw,” says Kayode Oduwole, MD/CEO, Fountain Field Co. Limited.
Oduwole, whose company’s products range include locally produced inner and security doors, kitchen cabinets, wardrobe panels, office furniture, etc says it is not impossible for Nigeria to produce good and enduring products, believing that the country is capable of producing world standard products that could rival anyone produced anywhere else in the world.
CHUKA UROKO