FG should strengthen manufacturing industry to curb substandard materials
Mrs Bukola Iluyomade is the Chief Executive Officer, AIMART, a property development firm. In this interview with CHINEDUM UWAEGBULAM, she spoke on ways to eliminate substandard materials and turn the fortunes of technical education to improve youth unemployment.
There has been an influx of substandard building materials in the market leading to complaints and structural defects in some of the buildings around. How do you view this challenge? What is the way out?
WHAT is happening in the housing sub sector is a reflection of the entire economy. In other climes where there’s zero tolerance to substandard goods, this question will not even arise. They have a system in place that checks all that without compromise. In 2015, I exported a container to the UK. The system there detected a variation in the standard requirement for the goods. They didn’t only return the container, but I was forced to pay for the shipping! It is amazing how substandard goods find their way into the country despite all the measures put in place by the different regulatory agencies to tackle it. I believe that we can do more as a country.
Also, our business men going to China and other places to manufacture substandard goods, specifically, and shipping them back into the country for pecuniary gains should have a change of heart and put national interest above personal interest.
For me, reviving the Ajaokuta Steel Rolling Company will make Nigeria self sufficient in steel production just the way we are in cement production. One of the ways to tackle the influx of substandard building materials is by strengthening the manufacturing industry.
Case in point, the local cement manufacturers and Nigeria Wire and Cables have extensively curtailed the use of low-grade imports of these materials. Sourcing for good quality locally produced building materials will reduce the dependence on the foreign ones.
In addition to that, using materials certified by Standard Organisation of Nigeria (SON) and Lagos State Materials Testing Agency will reduce the incidence of substandard building materials and building collapse. The government and practitioners in the built sector all have a role play, if we are to curb the incessant building collapse menace in Nigeria.
The Housing Minister believes that there is no housing deficit in Nigeria. What is your position on this?
As a company, we believe that there’s no housing deficit in Nigeria for the Aristocrat and the upper class in the society. The upper class can afford to buy or build any property of their choice in highbrow areas or at the very least, lease a property. The minister quote was directed at the upper class of the society.
The minister claims and rightly, so, that there are a lot of empty houses in Ikoyi, Banana Island and Maitama. The issue is that these houses are simply beyond the reach of the middle class, who interestingly makes up to 40 per cent of the population.
The middle class is the engine room of any economy and if they cannot afford houses built is it the lower class that will afford it? In a sense there is no housing deficit but with a caveat for the upper class.
Our position is that there’s housing deficit for the middle and low-income class, which constitutes more than 70 per cent of the population.
The construction industry plays an important role in the economic uplift and development of any country, what can be done by government to improve the sector in Nigeria?
In my own opinion, the building and construction sector is a major employer of labour in any economy, Nigeria inclusive. The government can stimulate the sector by injection of capital into the industry through the employment of direct labour for the various infrastructural projects.
Giving projects to indigenous contractors in the building sector, specifically, not only gainfully engages a large number of people with variety skills, it also develops human capacity within the building construction sector.
Wages paid these employees will enable circulation of funds within the economy with more people having access to cash.
In my opinion, government should create an enabling environment for the construction industry to have more impact on the economy by giving tax incentives to the building construction sector giving the multiplier effect the impact will have on the economy.
I think this government has realised this and it is a plus for them. The award of some road construction contracts to some selected indigenous construction companies recently by the Federal Government, as tax incentive, is a step in the right direction. State governments should also build on that template.
The setting up of infrastructural development bank for the construction sector will be a massive boost for the industry, and also the economy.
In Europe and America, long-term loans of 30 years tenure at a maximum of two per cent interest can be easily obtained as long as the company is credit worthy.
If that can be replicated here for the real estate industry, housing deficit will be reduced drastically and the economy will be stimulated, unemployment reduced and indirectly, we will be tackling insecurity in our country since there’s a direct link between unemployment and insecurity.
It is a known fact that the present building techniques and technology are not amendable for mass housing in Nigeria. What options and policies should government consider in providing mass housing for the teeming population?
The traditional building techniques of cement and blocks are quite expensive mass housing production. More researches need to be done to get cheaper and reliable alternatives for mass housing production as it is done in other climes. Hence, it’s time to look into the use of alternative sources of building materials away from the traditional brick and mortar commonly used.
As a result, we have developed our own locally fabricated AIMART Boards, which not only reduces the cost of production but also maximises space and time of construction with reduced manpower. This is a novel product and it is the first of its kind in Nigeria.
It’s a product of Research and Development Department of Aimart International. The Aimart boards can be easily replicated making it the first choice right now for mass housing construction in Nigeria.
The middle class seems non-existent in the real estate sector. How can the developers empower the middle class and ensure their participation in projects?
One of the major focus areas of our housing project is targeted at the middle class. Hence, we have partnered with primary mortgage banks like Lagos Building Investment Company (LIBC) and Federal Mortgage Bank of Nigeria (FMBN) to provide medium and long-term mortgage facilities (five to 15 years) to interested and eligible persons at affordable interest rates.
The problem with the middle class is the bulk capital to purchase homes. Many are also ignorant of the fact that these kind of facilities exist for them to become homeowners.
At Aimart International, we have engaged in mass enlightenment programme to sensitise the general public, especially the middle income earners on our special product offerings aimed specifically to reduce the housing deficit among the middle-income earners.
Financing housing projects have been a major headache for property developers. Now it is getting worse, do you think that offshore funding should be the way to arrest the problem? What are your recommendations?
Property development is capital intensive and there’s always the need for heavy financial backing. Off shore funding is one of the ways to get access the much-needed funds at a very cheap rate for longer tenures than can’t be procured from any financial institution within the country. However, the downside is that as enticing as it is, such loans must be paid back in foreign currencies regardless of the fluctuations with the local currency.
The government can assist developers by providing a dedicated Infrastructure and development fund similar to the agriculture development funds at low interest rates for longer tenures.
How would you describe the real estate sector as it is today? Do you see it growing or it is stagnant?
The real estate sector is a constantly growing one as it’s a sure fire way to lock in the value of money inspite of devaluation. The real estate sector in Nigeria is very resilient. I remember during the economic crisis of 2008, it was only the real estate sector in Nigeria that didn’t go down. Even post COVID-19, the real estate sector in Nigeria has shown robustness despite the initial sluggishness.
The dearth of skillful artisans seems to be getting worse with the apathy of Nigerians towards technical education. What can be done to revive technical colleges? How do we entice the youthful population to embrace apprenticeship in the construction industry?
One of the ways to curb youth unemployment and restiveness is the embracing of apprenticeship instead of chasing non-extent white-collar jobs.
First of all, for this to happen, there has to be a change in our mentality and value system. There must be recognition by the Nigerian youth that there’s dignity in labour. Our youth complain about not getting jobs while there is a heavy influx of artisans from neighbouring countries who take up our construction jobs.
Next is a resuscitation and establishment of more technical colleges and the revival of the manufacturing sector of the country.