In this ‘eTerview’, CEO of BSSL and immediate past president of Institute of Software Practitioners of Nigeria (ISPON), Olorogun James Emadoye x-rayed the issues facing implementation of local content and the promotion of indigenous software companies. Nigerians need to reset their minds and have a better sense of orientation in accepting local products and services, said Olorogun Emadoye. For him, the future and even sustainability of local software companies inherently define the future and sustainability of Nigeria as a country. He spoke with IT Edge News, Olusegun Oruame and Nwakaego Alajemba.
When you look at the software industry in terms of local content and indigenous entrepreneurship, has anything commendable happened in the last four years?
Unfortunately I cannot say a lot has been achieved in the last four years in terms of local content in the software industry. It’s sad because considering the nature of the world economy and what is happening today the future of any country is more of technology than any resource that the country may have. This is because technology is actually trying to replace any natural resource that you may think you have. For example, Nigeria may think that we have oil which has sustained us over these years but in the next five years the demand for oil will continue to be on the regressive rather than increase because people are developing various technological alternatives to energy from crude oil. You are already aware that in the next two- three years, a lot of electric vehicles will come out and people will no longer really have demand for PMS or for AGO for driving machineries as we have today. So technology is the way.
The sad thing about Nigeria is that in the last four years, Nigeria has spent several billions on what government called acquisition of computer software. The question is how much of the billions have gone into the local market? Not up to ten percent of that money has gone into the local market. That is where the challenge really is. How do you develop the local market without patronizing the market? That is the challenge. I have always maintained that software is like a tailor sewing a dress, if you don’t give that suit to him to make he can never perfect it the way you want it. No matter how poor that tailor is, by the time you try him with first one, the second one, the third one he will get to your exact size and that is software and it’s the same thing world-over whether it is written in the USA, UK and other countries. That is why we have what is called patches. Microsoft has the best and highest number of software patches. Microsoft will write the software, send it into market and when there errors or noticeable reports from users they now develop patches. It may not surprise you to know that only one of the four major software being used in Nigeria today to run government processes is written by a Nigerian company. The software is ‘Remita.’
All the other software used by government including the one for payroll are foreign. As a matter of fact, the one that is being used by the ministry of finance is sourced from Estonia, a country of less than 1.5 million people. Why on earth should a country as rich with mineral resources and talented people not source solution from her own people? Why are you buying such valuable product from other countries? So I cannot say that much progress has been made.
“You keep hearing people talking about startups but you cannot be talking about startups when older companies that are already built and are supposed to be the one doing business are not seeing the businesses.”
But there is more sense of aggressiveness in implementing local content policy by the federal government IT agency: NITDA” than ever before now. Has ISPON as a software industry body been able to coordinate more with government in actualizing the local content policy?
NITDA[National Information Technology Development Agency] has tried to pursue the policy more aggressively. For example, they have set up a clearing system within and are requesting all ministries and departments cleared with NITDA before deploying or acquiring software. The problem with Nigeria is that a lot of things happen in government to subvert policies and everybody can justify the reason why they want to do certain things outside of the rules. This makes policy implementation difficult. That is why it seems NITDA’s effort is not translating to what it is expected in the industry and there appears to be little progress in supporting local efforts. You keep hearing people talking about startups but you cannot be talking about startups when older companies that are already built and are supposed to be the one doing business are not seeing the businesses. I have been on a panel to review some projects in government and you will see a beautiful memo written to justify why a particular project should be implemented. But the moment the project is approved, signed and probably a payment is made, all that justification is gone, government people are looking for another opportunity in another project. These are some of the challenges otherwise NITDA, NOTAP have been trying but it is beyond NITDA and NOTAP. It has to be with the way the Nigerian people see themselves. It has to do with whether you think that your children and mine should have employment in this country, to have a means of lively hood. We have lived our lives to the extent that everybody just want to go abroad to work. Everybody is parading the American embassy; thank God that Trump has made it a little more difficult. Everybody is looking to how to relocate to Canada forgetting that some people sat down in those countries to make those countries what they are today. Believe me all stakeholders are trying. NITDA is trying, ISPON is trying, the Nigeria Computer Society (NCS) is trying, Computer Registration Professional Council of Nigeria is also trying but it’s beyond these people. The local content policy has to be accepted wholly by the Nigerian people. I have recommended over and over again that the local content policy should be taken back to the National Assembly and a law be made with punitive measures built into that law for those who would subvert it. The reason is clear. During President Obasanjo’s administration in 2006, a similar executive order was given to all ministries, departments and agencies (MDAs) but the moment Obasanjo’s administration ended, everybody went back to doing the wrong thing. You won’t be surprised what is going on in the government even with the Freedom of Information law, the information is still not free and accessible as the law permits. We need to inculcate it into our lives that whatever we are doing, not just software, Nigeria cannot develop if we cannot produce what we consume.
In other words, we need an ethical rethinking of hthe national assembly make this law?
In my handover note to the new president of ISPON, I stated this and some of the work we have done in that respect. We have reached out to tow we should be as a people. We need a mind reset against our lust for foreign goods and we need a law to criminalize non-adherence to the local content law. Why is ISPON not working to get he National Assembly on some of this but like I said, it requires the three main associations in this area, which is ISPON, NCS and CPN[Computer Professionals Registration Council of Nigeria] to work together to achieve this. I believe that the associations are looking into it. But much more than the associations, people who run government themselves must have attitudinal change. If you have never travelled abroad before, the moment you are appointed even as low as the local government chairman, the next thing you are planning to do is how to get passport for you and your family to travel. I keep asking, how many people in other countries do that? Once a Nigerian gets appointment into government, he or she will be thinking of buying houses outside Nigeria. The question is: what are you doing in your own country? Even the money you are ‘stealing’ (I’m not saying anybody is stealing), if you invest it back into this country, then somebody’s child might be able to get employment. In the 1980’s when we came out of school and were looking for jobs, I can count over 30 industries that were available for people to seek employment, all of them are dead today. If you go to Ikeja industrial estate, churches have taken them over. Even in Ilupeju, churches have taken over. I started with a company called Universal Computers in 1984 and I was transferred to Benin same year. By 1985, I was able to change my employment to Delta Steel Company Limited, as at then, Delta Steel Company Ltd was having staff strength of six thousand. Today, it’s nowhere. Steel is imported. How can our children get employment when everything we do today is imported? Michelin that used to produce tires in Port Harcourt with staff strength of 1,250 had their plant closed down. Today, you still have Michelin tires all over Nigeria, so what has happened? Michelin staff strength is less than a hundred today with probably about two or three expatriates making much money than they made when they were producing locally. What is happening now is that they produce somewhere else and import the finished product into Nigeria, generating employment over there while we are losing them in Nigeria. Government need to d change the strategy ensure local production and local content.
I haven’t really seen the commitment of bodies like ISPON, NCS, CPN to aggressively pursue the local content agenda within MDAs. Is the industry really ready to advance its own interest?
The two years that I ran ISPON, all that I did was to fight for local content with NITDA, NOTAP [National Office for Technology Acquisition and Promotion] and all the agencies that are involved even the National Assembly. We fought the Bank of Industry (BoI) to support the software industry, the records are there, the correspondences are there, the proofs of the meeting are there. But this is a very difficult country, yet it’s very simple and easy to run. People here are always thinking of what is in it for me and that is a major challenge for us. Even our fintech that we claim is very advance today has a major challenge. What is the challenge? I can sit right here as we seated now, log on to my account and transfer hundred of million to anybody if I have it in my account. Do you know you cannot transfer twenty dollars to another bank, to another customer in America that easily? There are safeguards. You cannot enter a bank in the USA and say you want to withdraw ten or twenty thousand dollars (your own money). The searchlight that will be on you will be unimaginable. We have attained commendable successes in Nigeria with fintech, we have been able to implement easy transfers. We have also been successful with the BVN which also allows us to fight corruption. If you move money, no matter the amount, we should be able to see what is being moved. We said we have a policy that we cannot issue a cheque of more than one hundred and fifty thousand naira to a third party, three million for the account owner and five million for corporate bodies for over-the-counter withdrawals. But in spite of these, heavy cash over these limitations are moving about. Where are they coming from? Are they not coming from the banking system? So implementation is always a problem in Nigeria. On how ISPON can influence issues, no matter how much the association fights, you need to know that the Nigerian agencies themselves when they are created or formed they become political institutions at the end of the day; and when they become political institutions, those running them will now change their focus from what it is meant to do to how to satisfy political interests and that is the problem we have. Otherwise, with NITDA, NOTAP and Bureau of Procurement (BPP), we are not supposed to have all the problems that we are having today. The problems are there because this is Nigeria.
“How do you develop the local market without patronizing the market? That is the challenge…. How can our children get employment when everything we do today is imported?”
In the framework of what you said now, is there hope for software companies like yours that are indigenously owned and managed?
Yes, there is a lot of hope but there are a lot of challenges and the challenges are much. When you ask is there hope? There is hope. At a time, we were running the software for the whole of UAC Plc business units that includes: UAC Property, UAC Chemical, Mr. Bigg, and UAC Foods. But in a country where people think less of their nation, and banks don’t support companies to be able to increase and provide more solutions, the chances of sustainability are not strong. Again, a new MD or CEO takes over a company being serviced by a local software company and because he probably sees an opportunity of making some dollars if he goes abroad, he will say: “Oh no, I want a big system, I want to go offshore. So if for example, they are paying hundred million for the local package, they will now go offshore and pay two billion. In this country, BSSL at a stage provided a state government with its software to run the budgetary system. Everything was going on well until at a stage, the state said wanted to go big so they went abroad and spent billions. As a matter of fact, what BSSL was doing probably with 4-5 consultants, they brought in 15 expatriates from South Africa and spent close to six months in Nigeria implementing that software. So how do you develop your own people? If that project which BSSL had handled for a number of 2, 3 4 or 5 years, if that state had said look, we want it big; can we make it bigger? BSSL will say yes we can make it bigger. What that means is that BSSL will implement a bigger solution, and take more people from the labour market to increase the resource base of BSSL. We will build a great capacity across board and then the company will grow. But your own people will never allow that because of ‘corruption’. BSSL, has been able to remain in business because there are one or two companies that believe in Nigeria and that Nigerian can do it. As we have more people having the mindset of believing in Nigeria, we would stop to be import destination for solutions from China, USA, Brazil, Italy or the likes. BSSL will survive by the special grace of God, it will grow and we hope that people will continue to move in. Software is something that requires a lot of investment because a technological change is very rapid. We need to improve our educational system and I have over and over again drawn attention to this. I have written a memo to the Minister of Education and have been privileged to be invited last year to the education summit in Abuja.
So you also agree that the town is not meeting the gown – How then can we improve our educational system?
The reason is because we tied our educational system to the apron string of the government so that vice chancellors in universities, for example, don’t stay in their schools again. They spend nearly six months running after their ministry to access the money budgeted for their universities, they then spend another three months running after the National Assembly to sustain whatever has been budgeted or to increase it, they will spend the remaining period of the year chasing the ministry for release of the funds. How do you develop an educational system with such type of arrangement? We are coming from the standard that UK government has developed for us but meanwhile, you know today if you are a citizen of the UK you pay school fees in the tertiary institution. If you don’t have the money, you get admission, you apply for a loan and you get it. You are told that when you finish school and you get a job and when you start earning from 25,000 pounds per annum, then you start paying back the loan and you can repay the loan for a period of 15 to 25 years. In Nigeria, we are pursuing free tertiary education that is not realistic. Ghana has already adopted the student loan scheme and so are 14 other African countries. Today our children are leaving Nigeria to go to school in Ghana and yet we cannot see what is wrong with how we fund tertiary education.
“The problem with Nigeria is that a lot of things happen in government to subvert policies…. That is why it seems NITDA’s effort is not translating to what it is expected in the industry and there appears to be little progress in supporting local efforts.”
You are saying tertiary education is not cheap and cannot be free?
Education cannot be free at tertiary level. It’s so sad that you have private school charging at the average of N400, 000 per term for secondary school education, that is N1.2million per annum and yet you want university education at less than half that amount. What I’m saying is that with average charge of N300, 000 to N400, 000 per annum for a student in the university, the university will be okay. My analysis is that if, for example, you take N400, 000 per student per annum in University of Lagos and multiply it by the total number of student in that school, it will be above any amount that the government has budgeted for the school for a year.
You share the opinion that tertiary education feeds on corruption?
Totally! The vice chancellors themselves have become politicians, travelling to Abuja for all sorts of things. If we create student loans, what will be the resultant effect? The universities will become more competitive. There will be jobs created within the universities. They will have sufficient money to buy their laboratory equipment, because they are not looking unto anybody. There is nobody to bribe to get budgeted funds released to them. They will run almost the benefits that all these private universities are having, running without begging anybody for money and the money will come in. We can’t have a problem with the students paying back because in an era of BVN [Bank Verification Number], you will be able to trace back all beneficiaries. The first thing is to allow the economy to run so that when the students get good jobs they will be able to pay back. The most important benefit is that it will make our children to become more responsible. Anything you get free doesn’t give you that sense of responsibility and it is not valued. We will now have quality materials for our labour market. The universities have been on strike now for four months, how can you get quality materials from such universities when you don’t train, you don’t teach, you don’t learn more than four months in a year. It’s not possible! How can you get quality material from the university when there is no fund for them to do exchange programme, and no fund to upgrade their laboratories? There lies the problem. When universities become professionally managed and are fee paying institutions, then they can become Centres of Excellence for software development and technological innovations.