9th Edition Of The Sigma Club Lecture In Commemoration Of The 68th Anniversary Of The Club

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YOUNG PEOPLE MUST BE VIGILANT AND HOLD THEIR LEADERS TO ACCOUNT SAYS OSINBAJO

LECTURE GIVEN BY HIS EXCELLENCY, PROF YEMI OSINBAJO, SAN, GCON, VICE PRESIDENT OF THE FEDERAL REPUBLIC OF NIGERIA, AT THE 9TH EDITION OF THE SIGMA CLUB LECTURE IN COMMEMORATION OF THE 68TH ANNIVERSARY OF THE CLUB,IN IBADAN, ON THE OCTOBER 27, 2018.

PROTOCOLS

I am honoured by this invitation, to deliver the ninth edition of the Sigma Club Public Lecture in commemoration of the 68^th anniversary of Sigma Club, which is the oldest surviving university youth club in Sub-Saharan Africa.

The club was founded on the sound principles of character and integrity. Sigma club’s illustrious members through the years, which the foundations of the club were indeed, well thought out, and through the years, they have rendered invaluable service to the university community, through the endowment of a scholarship and an essay competition.

We must also commend the contributions of old Sigmites, to our nation and mankind. We commend today even as they celebrate the 68^th anniversary of their illustrious and distinguished club, congratulations indeed.

I am to speak on the topic, “Developing the Nation through Youth Employment.” Let me say that there is really no other way of developing our own nation without youth empowerment or put differently, without creating jobs and opportunities for the youth. This will become clearer as we set the context.

The university community is an important place for us to analyze policy and to look deeply at some of the issues that concern our nation. Social media cannot do it for us; it cuts bits and pieces of what may sound interesting, but I think that the university community is the best place for us to take a good hard look at some of the things we are seeing in our country, why we are where we are and what we need to do to move forward.

Nigeria is Africa’s most populous country, and like the rest of the continent, it is a nation of young people; half of the population being below the age of 20.

By the year 2050, we will be the world’s third most populous country in the world, exceeded only by India and China, in that order. 60 percent of that population will be made up of young people. Those young people must have jobs or opportunities to make a decent living, and of course, the required training to cope with the emerging knowledge and technology-driven economies which we are bound to see in the coming years.

Already, the competition across the world is one that is based on knowledge and innovation, and that competition is so because we now live in a completely globalized environment. It is no longer possible to see Nigeria as a country within its own borders. All the opportunities we see today cuts across borders and even our own local experiences. We must think globally and in our planning and thinking, we must look at how to deal with all the issues that have arisen globally.

Let us backtrack a little and give some background to where we are today and why.

First, let me share the Nigerian Bureau of Statistics and the World Bank, statistics of the numbers of poor people in Nigeria since 1980 and bring us up to date. It is important for us to understand the enormity of what we are dealing with and how exactly to tackle those problems.

In 1980, 17.1million people living in extreme poverty. These were persons who were not able to afford the basic things like shelter, food and clothing. By World Bank standards, they were people who could not afford $1.90cents a day. In 1985, it became 34.7million, in 1992 it became 39.2million, in 1996, the number became 67.1million, in 2004 it became 68.7million and in 2010 it became 112.47million, a jump of close to 40million persons, between 2004 and 2010.

Today, the NBS is still doing its latest survey of what is called the household survey of poverty, so we don’t have the latest in that five-year figure.

So In 1996, there were an estimated 67.1million Nigerians living in absolute poverty. In 2004, the number moved up, to 68.7million. By 2010, a most shocking thing had happened, that number had almost doubled, to 112.47million. What happened between 2004 and 2010? What is astonishing about the poverty situation is that it persisted even when the nation earned its highest revenues.

Let me give you the figures from our oil earnings:

1990-1998 – $119.8billion

1999-2009 – $481billion

2010-2014 – $381billion (more than we earned in the 10 year-period of 1999 – 2009, more than we earned in 1990 – 1998). We earned this within a period of four years, 2010-2014, we earned $381billion.

Between June 2015 and today, we have earned $112billion.

Now take the period between 2010 and 2015, for most of that period, Nigeria enjoyed an oil boom, with oil prices hovering around $100-$114per barrel on the average. This is the period when we have earned the highest amount from oil in any period in our nation’s existence. But during that period, our external reserves fell to 30billion by the end of 2014. The number of out-of-school children as of 2015 was 10.3million. And in that period, we piled up the highest debt in our nation’s history.

Let me give you the figures of the total debts, local and foreign, for the Federal Government and the States debt from 2010 to date: 2010……$35,093.10billion

2011…… $41,549. 44billion

2012…….$48, 496.23billion

2013…….$64,509.95billion

2014…….$67,726.28billion

2015…….$63,806.53billion

2016…….$.57,391.53billion

2017…….$70,999.26billion

2018…… $73,207.94billion

What do these figures show? They show that when oil prices were at the highest between 2010 and 2014, the government was borrowing heavily from 2010 to 2014, debts moved from 35billion to 63billion. When we assumed office in 2015, the debt that the previous government left was $63billon. Today three and half years later, the debt is 73billion abroad.

It is important for us to understand what accounts for earning a lot, and you are still not providing the jobs, you are borrowing and children are out of school.

But how do we explain the paradox of high growth figures and rising poverty and unemployment figures? The first is that high oil revenues do not necessarily translate to jobs. The oil industry by itself produces few jobs as an industry. The high revenues can only translate to jobs and better living standards if the revenues are invested in the diversification of the economy, infrastructure, education, healthcare, and social protection for those who cannot work.

The question, of course, is what happens to the revenues? The most important drain on our resources is grand corruption. The stealing of large sums of public resource by public officials in collaboration with private individuals. I use the expression “grand corruption” to describe the direct looting of the treasury not necessarily tied to any government contracts. This is in essence state capture. It is this heinous phenomenon that a makes a country with its huge resources not to be able to benefit its people at all.

Today, we are doing a scheme called Trader Moni where we give N10,000 to petty traders, those hawking and doing petty traders. We are giving 2million petty traders N20billion, most of them have inventories not more than N3000 – N5000. In one transaction that took place in 2014, N60billion was withdrawn from the treasury and it simply disappeared.

When you compare N20billion for 2million traders, you can imagine what can be done with N60billion. In another transaction, $292million was embezzled. This is what I refer to as grand corruption.

I want us to bear in mind that no nation can prosper when its resources are fleeced in that manner. What happens with grand corruption is that by diverting government revenues to private use resources are not available to be invested in a manner that is planned to benefit the majority. No economy can survive on the theft of the commonwealth by its custodians. You and I know that if your personal resources are stolen, you are poor.

I think it is important for us to keep ensuring that we do not miss that point, because in my few years as Vice President, were we able to deal with grand corruption, which is one of the major issues we have been able to tackle as a government, resources available to us would be tremendous.

As you have seen with the figures, we are earning 60% less than was earned in the period 2010-2014, yet we are spending N2.7trillion on capital, the highest in the nation’s history. Why? You can do more with less if you don’t steal the money.

The third is, flowing from that is you cannot invest in infrastructure and the creation of an enabling environment for business because, and this is what we have seen through the years because we have lacked the resources required to invest the infrastructures. You cannot develop an economy without investments in rail, power, roads, it won’t work no matter how people say it or slice it.

The fourth is the lack of commitment to diversification of the economy, which would, in turn, provide multiple streams of revenue. This is both an issue at the national and subnational level. What then is the plan to provide the jobs, to build a country where young people will find the jobs and make progress?

There is no nation on earth that is built by a group of people called its leaders, everybody must pay attention if we don’t, our future is lost. We must see and scrutinise.

So what is the plan to build a country that would provide enough jobs and opportunities for young people now and in the next few years? How can we make sure that we do not return to the years of mindless looting of public resources that has impoverished us and endangered our future?

The first was to deal with grand corruption.

The second is investment in infrastructure; no country that seeks to develop and prosper can afford to treat infrastructure with the nonchalance with which we treated it as a country, especially in the last four years.

It is the reason why, since we came into office in 2015, the administration has devoted as much to infrastructure as we are doing, investing in rail, roads, and power. As of today, in two budget cycles despite earning over 60% less than the previous government, we have invested N2.7trillion on capital, the highest in the country.

What is the impact of all this spending? It is a good question, and I am going to give you the answer.

Building infrastructure is like laying the foundation for a skyscraper, you must drill downwards, lay your piles for a year or two, at that time people don’t see the building but the foundation laying is going on. And I will provide examples, here in Ibadan some of you might have seen the standard gauge railway line that is being constructed from the Apapa port in Lagos. We started constructing this year, and we expect to see the completion of that first phase by end of January 2019. When it is completed, gods will be able to move from the Apapa port to Kano, it will also provide passenger transport from one end of the country to the other.

In Abuja, after almost fifteen years, we have completed and commissioned the Abuja Light Rail Project starting from the airport to the City Center. It is currently running a free service and I think by the end of next month, we will run a commercial service.

Similarly, we completed and commissioned the Abuja-Kaduna Railway in 2016. Here in the Southwest of Nigeria, work is going on the Lagos-Ibadan Expressway. We should ask ourselves, Lagos-Ibadan Expressway has been there for so many years, it needed to have been sorted out, it just wasn’t. This is the major outlet from the commercial city of the country out to other parts of the country.

Work has been going on also on the Lagos-Otta-Abeokuta Expressway, the Ikorodu-Sagamu road, the Ogbomosho-Ilorin road, Maiduguri-Port Harcourt railway, the Warri–Aladja rail which is important for our iron ore. These are infrastructure projects that are going on today. We have counterpart funding for a lot of these infrastructure projects. The Chinese are giving us funding for the Lagos-Kano and we are providing our own 15% counterpart. So it is a long-term loan. We are also doing the same for the Lagos-Calabar railway. We cannot complete these projects without borrowing. But whenever you borrow, it must be used for infrastructure, you can’t borrow to pay salaries.

On power, we have moved generation from 4000 to 7000mw. But there are constraints with transmission and distribution and unfortunately, the DisCos, the private owners of the distribution facilities have not had the resources to invest in transmission and distribution.

We have taken that on, and through the TCN and the NDPHC, we are completing transmission projects all around the country. But the more important strategy is to decentralize power production. So we have adopted an off-grid programme, which means that we are encouraging private investors to collaborate with government to build Independent Power Plants and supply power to willing buyers.

This was made possible by what is called an eligible customer declaration by the Ministry of Power, Works and Housing. By this collaboration, we have been providing power, especially Solar Power to economic clusters such as markets across the country. This is cheaper than other sources of power. The markets include Ariaria market in Aba – 31,993 shops, Sabon Gari market in Kano – 13,598 shops, Sura market in Lagos 1047, Isikan – 493, NEPA – 256, Gbagi – 8778, UMBC – 2178, a total of 81,691shops servicing 320,000 SMEs.

Yesterday in Lagos, we commissioned the Sura Market Solar Project; the businesses there now have 24-hour power. From printers, commercial tailors to small chop businesses; everyone is employing more and making more profit. If we stick to our agenda, in the next two years, we will see the most significant improvements in our power sector in history.

In providing jobs and opportunities for the future, we are also banking on Agriculture. Agriculture has been a major success story with increasing budgetary allocation to agriculture from N8.8billion in 2015 to N46.2billion in 2016 and in 2017 to N103.8billion.

Through the Anchor Borrowers’ Programme, credit is given directly to smallholder farmers, through the CBN and 13 participating banks. So far, credit totaling N120.6billion has been given to 720,000 smallholder farms cultivating twelve commodities; including rice, wheat, cotton, Soya beans, Cassava, poultry and groundnuts, across the 36 States and FCT.

The importance of our agricultural budget is that it creates opportunities for those interested in farming and the whole agro-allied chain.

To support that we launched a fertilizer programme to improve local blending capacity in collaboration with Morocco. Today, we have 11 Fertilizer Blending Plants with a capacity of 2.1millionMT. Price dropped from N13,000 per 50kg to N5,500.

With the ranking up of agriculture, we now have a situation where within the next few months, we should be self-sufficient in rice production. Before we were buying $5million dollars worth of rice every day in terms of importation, today we are down to 2% of those imports. By focusing on agriculture to a level greater than any other government, we have opened up opportunities for young people.

The opportunities are not necessarily in participating in farming itself, but several of the opportunities are around technology that we have seen especially in the last few years. I will give you a few examples; Farmcrowdy is a digital agriculture portal that crowdsources funding for farms across Nigeria.

Founded in 2016 by Onyeka Akumah and three other young Nigerians, it works like a mutual fund, pooling together money from multiple investors to establish farms and hire smallholder farmers to cultivate them, and then paying the investors dividends from the harvests from these farms. In December 2017 it raised $1million in funding. This is an innovative way in which young people are not only investing in farming but investing for others in farming, making money for themselves and their investors.

Four years before Farmcrowdy, in 2012, Yemisi Iranloye founded Psaltry, a cassava processing company in the rural town of Ado Awaye in Southwestern Nigeria, more than 200km from Lagos. The starch it produces from the processed cassava is now used by several leading Nigerian food manufacturing companies, including Nestle, Unilever and Nigerian Breweries, as they increasingly replace imported starch with locally-sourced varieties. Psaltry was one of the companies that found growth opportunities in the midst of the recession, as companies cut down on their imports. In 2015, its revenues grew three-fold, and in 2016 it began building a second production line.

Kola Masha’s Babban Gona (name of company) supports smallholder farmers in Northern Nigeria with financing, agricultural input, training and marketing. Masha is leveraging his experience in both the private and public sectors to deliver solutions that are changing the lives of thousands of struggling farmers.

Angel Adelaja, the founder of Fresh Direct, has perfected an innovative approach to farming, in disused containers, without soil and with very little water. What she’s doing could very well be the start of an urban farming revolution in Nigeria. And the edge you have as young people is that you can bring your affinity for cutting-edge technology to bear on whatever you try your hands at. I have no doubt that seated in this room today, are some of the people who will feed Nigeria tomorrow, and make fortunes while doing so. The opportunities are growing by the day, and I hope that at least one person will take advantage of them after today.

An area where we have launched one of the most aggressive drives for promoting business is in the tech space. We believe that the future for job creation and efficient and profitable businesses lies in innovation and technology.

We have partnered with local and international tech companies and innovators, in the building of tech hubs, and promoting innovation. Our aim is to completely democratize access to support for innovation and cyber commerce and create jobs.

In September 2017, we hosted Mark Zuckerberg, the founder and CEO of Facebook, at the first Aso Villa Demo Day. Following that event, we went on to partner with the World Bank to launch a business plan competition for the young entrepreneurs who had participated in the qualifying stages for the AVDD. At the end of that competition, we selected 81 beneficiaries to whom we disbursed a total of N756million in grants.

We understand how extremely important funding is for entrepreneurs. We have a new N10billion fund for technology start-ups, managed by the Bank of Industry.

And then there is the Development Bank of Nigeria, set up by the Federal Government, with funding from international finance institutions, and licensed by the Central Bank in 2017 to provide low-cost funding for technology start-ups.

There is so much that can be done and is being done in the area of technology. I have personally been to 11/12 technology hubs and we are collaborating with these hubs. In these hubs, there are young Nigerians who are working on different forms of innovation, with different forms of innovative technology. They include the Climate Change Innovation Hub, in Yola, the North East Humanitarian Hub. We have also in collaboration with Civic Hub promoting technology and innovation in universities with the Students Innovation Challenge in the six geopolitical zones, what we are looking at is the different universities and the best innovations would be backed by funding from BOI and CBN

A few examples of technology companies providing jobs in the FinTech space, in particular, are: Paystack, a safe payment system, which offers seamless money transactions between businesses and their customers. It was established in 2016 by two young Nigerian alumni of Babcock University; Sola Akinlade and Ezra Olubi. Within the first three months of 2018, they have processed over N3billion and generate about 40billion annually for Nigerian businesses. The company is today powering over 9,000 businesses that did not exist two years ago, creating over 25,000 jobs. Paystack has over 50 employees all under 35 years old.

There is also Andela, a multinational company specializing in training software developers, co-founded by Nigerian born Iyin Aboyeji, Ian Carnevale, Jeremy Johnson and Christina Sass.

The company estimates that in the next 10 years, there will be 1.3million software development jobs and only 40,000 computer science graduates to fill them. The company’s vision is to change the future of Nigeria and the African continent by developing talent and potential in Nigeria. Today, the company today has 1,000 employees worldwide.

No matter how you look at it, technology is where the great opportunities are. We find technology in the creative arts as well. Already Warner Brothers has come to Nigeria looking for skilled persons in animated cartoons. One of the things we are doing with N-Power is training 15,000 persons in animation skills. The scope of opportunities is huge.

Our technology agenda is premised on our new educational curriculum which emphasizes STEAM; Science, Technology, Engineering, Arts and Mathematics. We are currently developing that curriculum with the support of global players like MIT, Cisco, IBM and Oracle, a nationwide curriculum that incorporates 21^st century STEAM thinking: coding, design skills, digital arts, robotics, machine learning, and so on. The curriculum will cover primary to secondary education, with the skills that are necessary to equip young people for the coming years.

The Arts component of that vision is extremely important to us. Visual arts, dance, music, film and theatre, comedy, literature, these and many more, are fields in which Nigeria has proved to the world that it is full of talent, originality and ambition. I think that talent and ambition must be turned to jobs, without the jobs and skills, it would just be talent.

The President asked that we set up a special advisory group for technology and entertainment with major players in both sectors, in order to advise on and develop policy. I chair that group and we have been working on different policies. Examples are companies that are facilitating payment, many of them are competing with banks without having licenses. So we need to develop policy for payment systems. The banks can’t stop innovation but we must also ensure that we regulate anyone that is involved in payment systems, not only to prevent unfair competition but to ensure that these systems have integrity and not rob Nigerians of their hard earned resources.

The third and final thing I will talk about is the Social Investment Programmes. The SIP is the largest and most ambitious social protection programme in the history of Nigeria. We provided N500billion for it in both 2016 and 2017 budgets. But total spend on the programme is closer to N250billion from both budgets.

The programme has four components, the N-Power programme, our graduate employment scheme, which is the largest post-tertiary jobs project in Africa. 500,000 graduates have been recruited as teachers, agricultural extension workers, and as public health officials. Each of these volunteers is provided with an electronic tablet, containing relevant training materials, including some with which they are trained to provide the required services on an on-going basis. The device not only helps in personal development, but it also empowers them to participate in the digital economy as data collectors, analysts and participate in surveys. With the device, they are able to learn coding, some level of robotics, entrepreneurial training, and others. Those are the kinds of materials contained in that device.

We also have the Government Enterprise and Empowerment Programme (GEEP) where interest-free loans ranging from N50,000 to N350,000 disbursed to more than 300,000 market women, traders, artisans, farmers across all 36 States of the country and the FCT, under GEEP. (56% of the loans have gone to women).

The Trader Moni programme is an important component of giving micro-credit to the bottom of the trading pyramid, smallest businesses, the one table trader, the bread or plantain seller or the mashai or maisuya. This is the largest segment of our working population; their inventory is no more than N5000 – N10,000. Under the scheme, we are giving micro-credits to 2million petty traders across the country.

This is important because you cannot create jobs without focusing on small businesses. Small businesses are the lifeblood of the economy of any nation. It is not the big businesses

A lot of the credit is direct intervention because most loans coming out of the bank is far too expensive. The scheme enables them to draw further credit if they are able to pay back within six months. The credit schemes also help them through the credit to replenish and increase their inventories, we give them a stronger chance, to earn more, while they also service the value chain that they are a part of. But more importantly, we bring them into the formal sector, where they have access to government and private credit. GEEP has led to one of the most successful financial inclusion outcomes, the opening of almost 500,000 new bank accounts/wallets for beneficiaries and intending beneficiaries.

In conclusion, Nigeria’s future lies in the hands of the youth, but that future is already here. Our role as government is to ensure that we deliver the environment that makes that possible.

To young people, my message is that you must be vigilant and hold your leaders to account, you must take time to study the facts, take time to scrutinise the arguments, to cross-check the arguments.

The future truly belongs to you, there is no need to argue that, but that future can only be guaranteed by your own vigilance and by making sure that those you have entrusted with power use that power only for the benefit of the people of our great country.

Thank you.