Overdependence on imported inputs questions capacity of research institutes

Nigerian manufacturers’ overdependence on imported inputs raises questions on the relevance and capacity of research institutes spread across the country.

The central reason for setting up the majority of research institutes is to ensure they come up with findings that can improve manufacturing, agriculture and raw materials sourcing.

But Nigeria’s manufacturers import almost 60 percent of their raw materials owing to issues relating to poor quality and state of locally available inputs.

This informs why manufacturers remain the worst hit of foreign exchange restriction, which made importation of their inputs almost impossible.

“When I started banking, Nigerian manufacturers were importing inputs, and now they are still importing. What are our research institutes doing?” asked Timothy Oguntayo, chief executive officer and group managing director, Skye Bank plc, at a forum on ‘Nigeria: Looking Beyond Oil’.

“We have universities which, in other parts of the world, serve as consultants for industries. What are they doing? We really need to find a way of reducing the demand for imported raw materials,” Oguntayo said at the event organised by Lagos Chamber of Commerce and Industry (LCCI) and PricewaterhouseCoopers (PwC) in Lagos.

Research institutes include the Raw Materials Research and Development Council (RMRDC), Federal Institute for Industrial Research Oshodi (FIIRO), Institute of Agricultural Research, Rubber Research Institute of Nigeria, and National Cereals Research Institutes.

Others are National Root Crops Research Institute, Cocoa Research Institute of Nigeria, and Nigeria Institute of Oil Pam Research, among many others.

This is excluding all the universities, including specialised institutions and polytechnics. BusinessDay earlier reported that these institutes, other than higher institutions, have been allocated N59 billion in the last three years.

Most of these institutes play in the agro-allied value chain, yet farmers say they are yet to see their benefits in terms of improved seedlings to improve productivity and sustain industries.

Abiodun Olorundenro, chief executive officer, Green Vine Farms, said Nigeria still imports most of its seedlings despite having agricultural research institutes.

“You can’t go there and get seeds because nothing is happening there,” Olorundenro said.

Manufacturers have ignored these institutes as they get their own machines and go into backward integration with the help of privately hired consultants.

“Though some of them are doing well, many are just there,” said Dam Ikam, managing director of a food processing company in Abuja.

However, analysts say the blame should be shifted to the government that has failed to fund the institutes adequately and monitor subventions given them.

“The agricultural research institutions in the country are not working. They have not improved farmers’ output in any way. But government needs to fund them adequately because research is not cheap and to ensure that the funds get to the institutions,” ” said Tunde Oyelola, chairman, Manufacturers Association of Nigeria Export Group and vice chairman of PZ Cussons Nigeria plc.

Micheal Oluwole Ajala, professor of Seed Technology, Federal University of Agriculture Abeokuta (FUNAAB), said research institutions are underfunded and lack basic facilities.

“ Equipments for research are obsolete or not in existence in many of these institutes,” said Ajala.

“Corruption is also a big problem. Most of the money allocated to these institutions in the budget doesn’t get to the institutions. One thirds of the total allocations finally get to these institutions. The money gets into private hands instead of the research institutions,” Ajala said.

Patrick Oaikhinan, CEO, Epina Technologies Limited, said the government also has to create the enabling environment to attract investors that will mine minerals needed by industries.

ODINAKA ANUDU