Evolving Strategies For Sustainable Financing R&D Activities Through The Public-Private Partnership Arrangement in a Developing Country Like Nigeria - Bank of Industries (BOI)

8/8/2019 Evolving Strategies For Sustainable Financing R&D Activities Through The Public-Private Partnership Arrangement in a Developing Country Like Nigeria - Bank of Industries (BOI)

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EVOLVING STRATEGIES FOR SUSTAINABLE FINANCING OFR&D ACTIVITIES THROUGH THE PUBLIC-PRIVATE

PARTNERSHIP ARRANGEMENT IN A DEVELOPING COUNTRYLIKE NIGERIA

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Ms EVELYN N. OPUTUMANAGING DIRECTOR

BANK OF INDUSTRY (BOI) LIMITED

AT THETHE 2010 SCIENCE AND TECHNOLOGY SUMMIT

HOLDING ON AUGUST 9-10,2010


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INTRODUCTION

Nigeria: Positioning For a New Decade -2020:

Nigerias strategic goals for the period will include

inter alia:

To become an important link in the global productionchain in technology, innovation, manufacturing andmodern economy

To expand trade and investment to achieve faster growth,create jobs, improve productivity of the work force andreduce poverty

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INTRODUCTION

In addition, as Nigeria expands its developmental space, fivefundamental shifts currently taking place in the economy will accelerate:

Primary products to manufactures with more elastic demand andfirmer prices

Oil to non oil ex orts rocessed a ric roducts solid minerals

crafts and manufactures)

Import substitution to export oriented industrial base

Public sector driven to private sector led market-oriented

economy

Managing the side effects of 20th Century economic progressespecially its impact on human welfare and the balance betweenthe possibilities for future generations and the economiccontinuity of the current generation

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INTRODUCTION

Along side these developments, the following trends will

create risks and opportunities in the new decade: the critical role of energy in every aspect of our lives

The innovation economy innovations that will transform the globaleconomy

Globalization - will dictate how competition will be in all aspects of theNigerian economy

Exploiting and promoting strategies that would accelerate thecommercialization of R&D results in Nigeria

All these will shape the future of industry, improve value

addition to industrial goods and services, improve the

linkages between R&D activities and the private sector,Nigerias future.4


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STRATEGIES

As a nation with huge oil wealth, we need to take advantageof the opportunities that the new decade presents:

i. we need to use our oil revenues to support and build moderntechnologies and innovations

ii. we need to work towards building massive industrial sector to

actua ze t e nat on s uge potent a siii. For this to happen, we need to sincerely and genuinely have a

strong private-public partnerships in the development of thenations infrastructures, agri-business, agro-industries, etc.

iv. The overarching objective of the work of R&D activities is tobring about economic growth-the capacity to diversifydomestic production structure through generating newactivities, strengthening economic linkages within the countryand creating domestic technological capabilities

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STRATEGIES

Second step in evolving strategies for sustainable

financing of R&D activities through Public-PrivatePartnership in the country is the establishment ofappropriate financing modalities to support the

implementation and use of R&D results in thecountry.

Third step is to continue to fund and strengthen

capacities to build up skills and develop technologiesthat improve efficiency and productivity along currentR&D results based on local demands and needs.

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STRATEGIES

Fourth factor in evolving strategies for sustainable financingof R&D in Nigeria is on strengthening the capacities oflinkages among public-private agencies responsible for

R&D financial sector and entre reneurs in the

manufacturing sectors.

Fifth, financing entrepreneurs that are involved in R&Dactivities who are innovative. Typically, innovation results

from a conscious purposeful search for opportunities. Theyneed to look for simple, focused solutions to real problems.

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BOI Financing Experience

The Banks lending structure has been positively favourable towards MSMEs andlarge enterprises, but with backward integration effect on MSMEs.

Based on the above: The Bank supports the formation of clusters and out-growers schemes in the

agriculture and agro-allied ventures and other sectors of the economy.

The Bank organizes capacity building in collaboration with the Domestic and

Foreign Development partners. MSME Development Funds in the following states: Anambra, Kwara, Delta ,

Niger, Kogi, Osun, Edo and Ekiti States ,while others are in pipeline.

The Bank has organized Boot Camp workshops on entrepreneurial development

in Gombe, Bauchi, Benue, Niger, Osun, Ondo, Ekiti, Anambra, Cross River, Delta, Abuja, Plateau States, etc. About 90% of the cooperatives we have funded areproducts of these workshops and also in partnership with US embassy inpromoting the African Growth And opportunity Act (AGOA) activities with aResource Centre recently opened in BOI, Lagos Office.

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BOI PRODUCTS AND SERVICES

Provision of direct loans, etc. Financial advisory services to entrepreneurs.

Equity participation or investment funds.

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Acting as intermediary between entrepreneurs and financialinstitutions.

The Bank has a Gender Desk handling various loan schemesexclusively for women enterprises in conjunction with the

Federal Ministry of Women Affairs amongst others. The Banks subsidiaries provide Leasing Services, Trustees

and Investment Services, Insurance Services, BusinessConsultancy Services, Micro Finance Banking Services,

Bureau De Change, etc. 9


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BOI PRODUCTS AND SERVICES

BOI has been appointed to manage development initiatives at

state and national levels: The Federal Governments N100 billion Cotton Textile and

Garment Development Scheme with funds being raised by the.

The Federal Governments Rice Intervention Fund of N10.0

billion.

Agro Sector initiative of the Bankers Committee that entailscollaborating with commercial banks and various State

Governments.

The management of the National Automotive Council (NAC)

fund. 10


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PRODUCTS AND SERVICESThe Business Development Fund for Women (BUDFOW) on

behalf of the Federal Ministry of Women Affairs and SocialDevelopment (FMWASD)- that provides soft loans to womenentrepreneurs.

The Central Bank of Ni erias N500 billion Facilit for the

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development of power and industrial projects out of whicharrangement for disbursement of N200 billion for the refinancing/

restructuring of banks loans by BOI is now taking place. The Bankhas so far received 377 applications and 84% out of the total

applications (totaling N130 billion ) have been approved fordisbursement.

And the guidelines for the balance of N 300 billion earmarked for

the Power Sector and Aviation will soon be released by CBN.


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Concluding Remarks

Evolving Strategies for sustainable financing of

R&D activities presupposes we want to influencetheir current financing methods for better results in

future. To do that we need:

A clearly articulated future vision and a sense of thetrends of the day that will enable the future to becomereality.

A sound set of strategies to get there as alreadymentioned in this paper.

Tools to persuade key stakeholders - NASENI, Energy

Commission of Nigeria(ECN),Banks, Nigerian Academy

of Sciences, etc. To be part of the expected changes. 12


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Concluding Remarks

Thank You For Your Attention

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Evolving Strategies For Sustainable Financing R&D Activities Through The Public-Private Partnership Arrangement in a Developing Country Like Nigeria - Bank of Industries (BOI)