Exchange rate biggest hurdle to doing business in Nigeria


Oluremi Adiat Hamid is an electrical engineer who has been in the vanguard of advocating for the use of renewable energy in Nigeria. Her desire to see mini and micro-businesses thrive due to regular electricity supply spurred her to set up Hydren, a company that provides Mobile Solar Solutions (MSS) to business and home owners in Nigeria. 

My background is in electrical engineering. I actually started my career in Telecom. l worked there as their chief engineer for seven years before l found myself in renewable energy. l think it is my desire to make renewable energy available and affordable for regular people that actually brought me into the business. There is a supply to demand gap in electricity supply in the country. Over 80 percent of Nigerians do not have access to electricity. I have been in an office where spending on diesel was quite outrageous, at the end of the month; there will be no profit, the entire expenses go to the purchase of diesel. Then the issue of deaths as a result of fumes from generators is another factor that encouraged me to start campaigning for the use of greener electricity supply. One of our goals is to reduce environmental pollution due to fumes coming from generators. Now we are in Lagos and our plan is to be in other states of the federation as soon as possible.

She further goes on to explain the challenges she has overcome and what the biggest problem is in business.

The greatest challenge in the business is high exchange rate because almost all the items we use for installation are imported. Another issue is that of substandard products. Some of the electrical equipment imported into the country from Asia, particularly China, are substandard and that has affected our work negatively. The fact is that if you install solar panel with fake items it will not work and your clients will not have value for their money. That is the reason some people will tell you that it does not work because materials used in the installation are all fake. A good quality battery should last up to fifteen months, but fake one will last only two weeks. And when you take it back to where you bought it, you are on your own because they will not listen to you. Sometimes, they will tell you that they are not the manufacturer and that the way you bought it from them was exactly the same way they bought it from the manufacturer. At that point, there is nothing you can do than to leave with fake battery that will not be of any use. Nigeria has become a dumping ground for substandard products not only electrical products. The Standards Organisation of Nigeria (SON) is doing their best. But there is need for them to put in more effort in ensuring that imported products from Asia are not encouraged here. From the look of things, we do not have any standard in this country and that is the reason people bring in anything they like. Also, the importers are not helping matters, they are the ones responsible for the influx of substandard products into the country; they are the ones that will tell the manufacturers over there to lower the standard of the products so that Nigerians can afford such products. If the importers will stand for standard, the manufacturers over there will not have any choice than to give them the standard they want.

America has a standard and it is the same in Asia; China in particular, that manufactures most of the products used in the US. I am sure that any product coming in to US must meet the US recommended standard.  The SON should carry out a thorough examination of any products coming into the country. They should not do random sampling because in the process of doing that, some products coming in will be good while some will not meet up with the standard. Some of these challenges can be taken care of if the Nigerian government can encourage manufacturing of some of these products by creating enabling environment for manufacturers. We have a lot of natural resources in this country. The raw material for manufacturing of solar panel is silicon and silicon is from sand. There is a lot of sand in Nigeria. So, the way out of this problem is for Nigeria to start manufacturing. My company is actually looking forward to having a factory here in Nigeria. When we start manufacturing, we will have a standard. By then SON will be able to monitor the activities of the manufacturers. After manufacturing, they will test the products before it will be moved into the market. And by so doing, the issue of marketing of substandard products in Nigeria will be a thing of the past. Besides, it will make Nigeria to be well recognised by other countries of the world. I believed that manufacturing is what made China to be rated as one of the largest economy in the world. If we have regular electricity supply and government makes manufacturing enticing by providing incentives for those who want to go into manufacturing, l am sure a lot of people will become manufacturers. On the other hand, the government will enjoy good trade relationship with other countries of the world.

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