‘Nigeria is becoming increasingly relevant for German investors’

Delegate of German Industry and Commerce in Nigeria, Dr. Marc Lucassen, in this exclusive interview with MARGARET MWANTOK spoke about the German-Nigerian Business Forum, which started yesterday to conclude today in Lagos and how it would provide a platform for public-private partnership and investment growth. He advised that Nigeria must invest heavily in education, as human capital is key for industrialization and diversification. Excerpts.

What informed this forum, and how is it different from the previous years?

We started the business forum last year after a five-year break. We restarted last year in Frankfurt with the parliament.

This year, we are expecting business delegates from 40 to 50 countries staying the whole week in Nigeria to attend our forum.

We are going to focus on the diversification agenda of the Nigerian government because we believe that the constraints of doing business in Nigeria give opportunities for German technology providers in the fields of food processing, energy, nuclear energy and environment, water supply and waste water management, infrastructure, information technology and so on.

When it comes to chemical energy, and pharmaceutical industry, the German economy provides solutions in all relevant fields asked for by the Nigerian decision-makers.

We are increasing our efforts to provide these solutions.

Nigeria and Germany have over the years partnered to enhance vocational training in Nigeria. What is being done to address skills gap in key areas of the economy?

The demand for skilled labour is in two folds. Looking at the Nigerian side, there are two major problems.

There is the youth bug; the average age in Nigeria is 18 years and the challenge for the political class is to provide adequate education, training and jobs to the young generation.

This is a social and political problem. The other challenge is that the diversification plan of Nigerian economy will not materialise if skilled labour shortage is not addressed and solved. When we did a survey, shortage of skilled labour was always named as a challenge in Nigeria.

If you look at the German side, there is a clear need for same labour.

So I would say we would have a win-win situation once we start developing something.

Vocational training is one of my key activities, but we cannot change Nigeria, as it is a mutual project with heavier burden on the Nigerian side.

We have been running a pilot scheme with our partners –Manufacturers Association of Nigeria and three chambers of commerce to develop skills so that the pilot project can serve as a paddle that would mold into skills.

I can inform you that we will, on our side, scale up this project to a larger scope. But we would like Nigeria to also invest in it; it is its obligation – both government and private sectors should be involved.

In terms of investment volume, how will the forum drive investments from German businessmen?

Specifically in the Nigerian context, the most important step to take is to invite foreign investors to see and to think of Nigeria, as a potential investment hub.

I have been in Nigeria for 15 years, and this is my third assignment to the country.

I know the prejudice that comes when you talk about investment.

The most important aspect for me is to bring together people, potential business partners in Nigeria and therefore we have put in a lot of effort to bring German business delegations to inform the public on business potential here.

It is not enough to say Nigeria is the largest economy or population in Africa, but you have to talk about the challenges and opportunities herein and the viewpoints of business opportunities.

This forum is a fantastic platform for both sides to meet. I urge Nigerians to come and connect with the German businessmen and authorities.

Can you put a figure to the volume of investment this forum will attract from Germany?

In my country, private sector investments are done by the sector.

Neither the government nor me, can force the private sector to do business anywhere.

That is the job of the Nigerian side to convince the international community of the attractiveness of Nigeria as an investment destination.

My job is to give the necessary confidence to potential investors to at least look at the opportunities and to bring together potential clients and suppliers; the rest is to the private sector.

Statistics from the association reveals that the volume of trade between the two countries deteriorated from 5.4 billion euros in 2014 to 2.9 billion euros in 2015.

What measures are being put in place to boost bilateral ties between the EU and Nigeria?

The real reason for the drop in trade volume is not that the factual trade had changed, but that the price changed.

The export from Nigeria to Germany’s crude oil dropped, and the import to Nigeria to Germany stayed more or less the same for the period of two years.

This is despite the fact that the Nigerian economy had less purchasing power due to the fact that it relies heavily on crude oil.

I will not take this exemption that the first recession in 25 years was the reason, but if the trade volume had been stable between our two economies, we may have exceptions like this one, that maybe the oil price dropped due to exchange rate.

For Nigeria and Germany, there are a lot of opportunities given the global developments.

I can tell you that for the German government, Nigeria is becoming increasingly relevant.

It took us some time to understand that Nigeria is one of the last right hotspots for many Small and Medium Economies (SMEs).

Our SMEs are increasingly getting interested because Nigeria is under serviced and over priced. It is a bet for the customer, good for some who are already here; it has a huge potential for the ones who are coming to get a substantial part of the cake that is still lying idle.

This is interesting and challenging target; it is not easy to do business here but I am here for the German companies and my job is to serve and help them because we understand the business environment that we have a critical number of German companies in Nigeria over the years with a decade long experience.

Our job is to share this experience with these new comers.

Nigeria is still experiencing some challenges in critical areas of the economy. How do you plan to partner in some of these areas?

The German presence in Nigeria covers all relevant sectors but I see all these defaults and obstacles – bad road and infrastructure, as cruising opportunity.

The fact that the infrastructure is dilapidated is a chance to every technology provider.

At the end of the day, all the deficit and gaps are opportunities for the private sector. We are open to partner with whoever is willing to do business.

Can you mention some of the Nigerian groups Germany is in partnership with?

I am representing the German Chambers Association, a private organisation, and I am representing the Federal Government on Economic Affairs and Energy.

German companies are partnering with Nigerian companies.

I can also tell you that German institutions are collaborating here very closely because we believe that business and culture ties go hand-in-hand.

Language, movies, television are as important as our business ties. We are not limited to the traditional economy; we are looking at the new economy, the creative industry.

We know that Nollywood is the largest movie industry in Africa; there are excellent writers and poets.

Our job is to improve collaborations and make ourselves relevant, to cover the whole sphere of bilateral relations.

As a leading economy in Europe, what latest innovation are companies going to showcase at the business forum?

We have the fourth largest economy on earth; the largest in Europe. The beauty of our economy is that we are covering all sectors.

We are willing to provide all the technologies asked for, but as a private sector institution, we have to focus; we should not shoot in all directions.

Focusing on the areas identified by the Nigerian side is very relevant for the determination process.

The six panels we are having at the forum will focus on the needs that were identified by our Nigerian colleagues, both private and public.

If you think of food processing and agriculture, we can help you in terms of packaging and cooling chain because we know that 60 per cent of the Nigerian produce does not reach the customer.

This means that Nigeria is producing enough food to feed the population but not everything gets to the consumer.

We can cover the whole supply chain; we are active in energy and environmental technology and so on.

The German economy produced about $4.1 trillion in 2017 as measured by gross domestic product. What suggestion would you offer Nigerian government so it could aspire to such economic height?

Copy-paste may not work as these are different settings, but I think there are some ideas I would like to offer.

There is a reason why Germany and Japan are some of the most industrialised countries in the world, and this is because they do not have natural resources – no oil, nothing.

This forces the society to create value because there is no alternative.

History is not something one can easily decline not to talk about. Nigeria has to invest heavily in education. Human capital is key for industrialization and diversification.

Investment in education does not start with vocational training; it does not start in high school or university; it starts in kindergarten, primary school.

The basic abilities in terms of reading and writing, in terms of creating a certain critical line that is necessary to think freely is set at the baby or young stage.

Nigeria also needs to invest in the necessary framework to have a platform for investments to come, both domestic and foreign.

The transportation infrastructure, electricity, water supply are key for economical growth.

The legal framework has to be right, because investors consider the ease and security of doing business.

Government should also take the complaints of foreign investors seriously because the ones who are already here talk to the ones who are planning to come.

How would this forum boost employment generation for both countries?

The fact that German enterprises are selling their technology and services to Nigeria creates employment. But they also put things into perspective.

70 per cent of German economy GDP is export-driven.

Our main export partners are located within the European Union.

Only two per cent of our trade volume goes to Africa and half of it to South Africa only.