By Sunny Chuba Nwachukwu, PhD
Nigeria’s economy obviously contends with a handful of internal issues ranging from social, economic, environmental, governance, and most importantly, security. The high level of insecurity and violence (with bloodletting) in virtually all parts of the country, by the so called bandits, kidnappers, unknown gunmen, and herdsmen (inclusive of Boko Haram), is dangerously drowning the country which, for many decades in the past, had always known peace. From the economic dimension, the citizens appear to be facing and contending with hunger, joblessness, poverty, with the increasing ethnic nationality clashes and intertribal disputes among the peoples in the land. The significant challenge centres on a failing economy with high rate of inflation, especially food price inflation; and the unprecedented fall in the value of the local currency (the Naira) at the foreign exchange market.
However, the newly registered NNPC Limited, done in accordance with the Petroleum Industry Act (PIA) stipulated framework in the face of all the challenges, the nascent business giant (from the angle of its expected roles, responsibilities and results), failures and underperformance are the least expectations of its future operations, now that it is mandatory to function as a profit oriented company.
Strategically, in this era of COVID-19, the management is expected to apply all feasible business success-driven management concepts and marketing styles, to record worthy exploits from take off! One of the critical strategies with low hanging fruits is to focus on the advantages of applying industrial revolution in the downstream sector from the onset, through research and development (R&D) programmes. Why am I saying so? The simple answer lies in the fact that the oil industry has significantly supported the economy consistently, as the major provider of foreign exchange earnings, but the ailment of the economy is traceable to the impact of activities surrounding refined products (among other forms of corrupt practices in the land). It is advised that the growth opportunities lie solely on what the NNPC Limited can do with the downstream businesses in this COVID-19 era when the landing cost of imported PMS is at N287/liter! How can ordinary Nigerians survive in a precarious time like this?
The global health challenge has really shocked the entire world’s activities by bringing everything to a total halt during lockdown, carried out simultaneously in all countries from the first quarter of 2020. This was desperately observed due to the high and frightening mortality rate of humans all over the surface of the earth.
The incidence of total lockdown brought all economies on their knees and to a standstill! All commercial and economic activities were completely stopped (international trade and every known business activity was held motionless because, traveling was restricted, with flights and shipment of goods and services momentarily ceased). The outbreak of this global health challenge significantly impacted the entire global economy as a result of measures and policies taken to fight it by the multilateral health institution, World Health Organisation (WHO), and all the countries of the world. The ‘life and death’ global battle against the spread of the deadly disease, which included social distancing, total lockdown of all social and economic activities globally, and restrictions on international travels, ushered in a new era with these identified economic challenges and opportunities. It strategically produced the “new normal” in ways of doing everything; thus now making the advantages of technological advancement available for NNPC Limited to rise to the occasion, by operational mode of virtual communications (using Information and Communication Technology, ICT), and working from remote locations (applying Artificial Intelligence and robotics).
Industrial development by numerous investors in the downstream oil sector in the present era, would require a revolutionary strategy that will match the new normal, both technologically and economically, for the sustainable future of the newly registered NNPC Limited. The factors that can effectively influence the needed kind of transformational change would include environmental, social and governance. This calls for a strategic approach to urgently leverage the opportunities available in the COVID-19 era, for a global reset that the economic growth factors throw in for economies to exploit. Take for instance, the oil and gas industry in Nigeria has not fared well in its downstream operations as a result of underdeveloped infrastructure for petroleum refining activities by the outgoing national oil company (NOC).
This brought about low national income in financial accruals from the unutilised, idle, untapped huge reserves of the natural resources of both crude oil and gas, amounting to great economic waste for the country. These resources, otherwise ought to transform the economy by its optimal and efficient utilisation, transformed into consumable petroleum products (fuels) through a robust energy solutions management, in the light of the world’s current energy transition search for renewable and cleaner energy sources, such as solar, wind, hydro, hydrogen, etcetera.
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Sunny Nwachukwu, PhD, a pure and applied chemist with an MBA in management, is an Onitsha based industrialist, a fellow of ICCON, and vice president, finance, Onitsha Chamber of Commerce. He can be reached on +234 803 318 2105 (text only) or schubltd@yahoo.com
