Don seeks conversion of natural resources for industrialisation

The Senior Special Adviser on Industrialisation to the President of the African Development Bank, Prof. Oyebanji Oyelaran-Oyeyinka, has advised Nigeria to harness the abundance of its natural resources, human capital, science and technology for industrialisation.

Oyelaran-Oyeyinka who gave a keynote,  titled, ‘From fragility trap to sustainable economic development,’ at the recently concluded Africa Social Impact Summit in Lagos,  said Nigeria was an example of a poor nation consuming what the rich nations manufactured.

He said, “The future will be defined not by the abundance of natural resources but by human capital, science and technology and how nations harness them for industrialisation. Due to their strong industrial capabilities, rich nations manufacture what poor nations consume. The Nigerian example is telling. Tied closely to industrialisation, but not always connected in public discourse, is arguably the most challenging economic issues faced by the country currently: Balance of Payment and foreign exchange crises. What we see manifesting as shortage of foreign exchange and the precipitous decline of the national currency is in large part because we consume high-value products that we do not produce, and export low-value raw materials.”

He also condemned Nigerians’ appetite for imports including expensive luxury goods.

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He warned that weak industrialisation was fueling socio-economic fragility in the country.

He added, “Nigerians, especially urban elites, have developed an appetite for imports including expensive luxury goods such as automobiles, foreign drinks, and clothes, electronic and household consumer goods. For example, the country’s top imports are Refined Petroleum ($77.5Billion), Cars ($3.03Billion), Wheat ($2.15B), Packaged Medicaments ($1.38B), Telephones ($771M) and special purpose ships ($4 billion). In contrast, what does Nigeria export? Coconuts, cashews, cocoa beans, rough wood, petroleum gas, and crude petroleum that accounts for 70.8% of all its exports, among others.

“Consider the Nigerian oil and gas sector. It is an example of massive opportunity cost of a weak technological base. The historical loss is almost incalculable. Nigeria has the second largest oil reserves in Africa and yet is a net importer of petrol and myriad petroleum products. It has the 9th largest natural gas reserves and yet barely has enough gas to generate 5 GW of electricity. According to OPEC, the country exports $27.73bn worth of petroleum products in 2020, while the value of the country’s petroleum imports in 2020 was $71.285bn. The country has an installed refining capacity of 445,000 barrels per day from four refineries that refined zero barrels of oil in 2022 because the refineries have broken down and are inoperable. In a country with the necessary metallic and chemical sector capabilities to produce, maintain and innovate, this situation will be unthinkable.’’

Oyelaran-Oyeyinka bemoaned the existence of 80 per cent of coltan in the Democratic Republic of Congo, saying it had been a curse rather than a blessing on the nation because it had no factories.

He revealed that coltan was the resource used for making heat-resistant capacitors in technological devices.

He said, “Let us examine one more example. Coltan is indispensable to the creation of all modern technological devices. The mineral is refined in tantalum powder, which is used to create heat-resistant capacitors in electronic goods of mass consumption, laptops, cell phones, and videogame consoles, whose profits have fueled the largest conflict in modern African history and electric cars.

“Congo holds 80 per cent of global coltan deposits and produces 60 per cent of the world’s supply. The rise of digital technology during the last decade drives demand for coltan and will evidently persist if no alternative materials are found for these technological devices. The eastern part of the DRC is extremely rich in Coltan (Columbite-Tantalite) but rife with conflicts, not factories.

“For years, companies in industrialised countries have purchased Coltan despite war and lawlessness in the DRC, and they became profitable sources of foreign currency for a multitude of state and non-state actors. Even though Coltan is not the only cause of the Congolese war, it has been a curse rather than a blessing.”