Category: News

It’s a question that’s been circulating, and last Friday, we found ourselves at the heart of this conversation at the ProvidusBank Non-oil Export Summit in Lagos, Nigeria. This event was a true gem—a gathering of minds, a network of opportunities, and a hub of discussions on how Nigeria’s non-oil sector can take the reins in steering the nation’s economic growth.

Stakeholders from the Central Bank of Nigeria, the Nigerian Customs, and other key players graced the event, each bringing expert perspectives on the untapped potential of Nigeria’s non-oil industries. From the engaging keynotes to the thought-provoking panel discussions, a unanimous consensus emerged: Nigeria must urgently harness the vast potential of its non-oil sectors.

For decades, Nigeria has relied on oil exports as its economic backbone. However, with recent oil price fluctuations and the global shift towards renewable energy, countries blessed with resources like Algeria, Angola, and Saudi Arabia are reassessing their oil-centric strategies. It’s a wake-up call for Nigeria to diversify its revenue streams, secure sustainable growth, boost government income, and generate job opportunities.

📌 Insights from the Summit’s Experts

📍 Embracing Diversification: Walter Akpani of Providus Bank stressed the paramount importance of diversification. He pointed out how fellow oil-producing nations are pivoting towards non-oil industries to brace themselves for a post-oil era. Highlighting the soaring global demand for products like vegetable oil, he urged investments in Nigeria’s rich resources, from oil seeds to fruits and spices, to drive non-oil exports.

📍 Sustainability for Export Success: Entrepreneurs eyeing the non-oil sector must prioritize sustainability in production and packaging. This mindful approach ensures lasting success in the export game.

📍 Nigeria’s textile and garment industries offer huge opportunities for export: Olori Ronke Ademiluyi-Ogunwusi’s eloquent presentation celebrated Nigeria’s textile and garment industry. In the 80s and 90s, it was a major player in Africa, employing masses. Today, with the world’s growing appetite for African textiles, Nigeria’s fashion industry holds immense export potential.

📍 Nigeria has a comparative export advantage: Uade Ahime from Nairametrics underscored Nigeria’s export edge. With its young population and fertile lands, Nigeria is primed for agriculture-led exports. A key takeaway: a shift from raw material exports to finished goods.

📍 Structured Financing is Key: Finance will no doubt play a pivotal role in harnessing the huge benefits of the Nigerian export sector. Export finance experts at the event made a strong case for thorough follow-up on export financing from bean to bag to adopt best practices in non-oil export processes. Daniella Jarikre of NEXIM Bank outlined efforts to smooth the financing journey for exporters, a move welcomed by all.

📍 Regulatory reforms are crucial: The panellists—Olasunkanmi Awoyemi, Ikenna Egbukole, Bamidele Ayemibo, and Ajibade Ogunniyi—dissected strategies for the agribusiness and mining sectors. They all agreed that for Nigeria’s non-oil sector to reach its potential, regulatory reforms are essential. A business-friendly regulatory environment is a prerequisite to attracting more investors in the non-oil sector.

Mariam Musa and Aminu Murtala Nyako further enlightened us on agribusiness hurdles and export opportunities in Nigeria’s fashion sector.

Congratulations to ProvidusBank for organizing such an impactful stakeholder dialogue and reinforcing itself as a progressive partner for international trade and export.

At ETK Nigeria and ETK Group, our unwavering commitment to international trade and exports resonates deeply with this event.

Imagine the possibilities for your business! 🌟 Our services and solutions have a proven track record of helping over 200 African businesses transcend geographical borders 📈✈️, foster growth, and create connections on a global scale.

Bolaji Sofoluwe, ETK’s Group Managing Director, spoke to CNBC Africa’s Aby Agina on Africa’s business environment on Africa Day. The full interview is included in this article.

Last week, the continent commemorated Africa Day 2023 on 25th May, and the 60th Anniversary of the Africa Union, allowing us at ETK Group to reflect on the tremendous strides Africa has made. As a firm believer in Africa’s potential and despite the challenges we face, we are thrilled to share our optimistic perspective on the Africa Continental Free Trade Agreement (AfCFTA) and the exciting opportunities it presents for our continent’s future.

Africa’s progress in advancing the AfCFTA is truly commendable. Drawing parallels with the formation of the European Economic Community, we recognise the efficiency and integration Africa has demonstrated. For example, in February 2023, the continent attained a significant milestone as three key protocols were ratified under the AfCFTA, covering intellectual property, competition, and investment facilitation. This monumental achievement brings together 54 previously fragmented countries, highlighting our commitment to fostering unity and collaboration. And while immediate benefits may not be visible to all, it is crucial to acknowledge the substantial progress made from a trade policy perspective.

The AfCFTA has the potential to boost Africa’s income by $450 billion by 2035, symbolizing significant growth opportunities. While it has been challenging to quantify informal intra-Africa trade flows, realizing this potential requires private sector-driven initiatives, policies effectively impacting businesses transaction by transaction, and entrepreneurs securing adequate financing for marketing and promotion.

As an active participant in promoting growth within African startups and working with entrepreneurs, ETK Group is particularly passionate about fostering intra-Africa trade. African businesses often face hurdles when marketing and promoting goods and services outside the continent due to associated costs. Comparing our marketing budgets to those of brands in countries like the UK, the Netherlands, or the US, we recognize the struggle African products encounter in sophisticated markets. However, by prioritizing intra-Africa trade, entrepreneurs can explore opportunities within the continent before venturing outside. Achieving horizontal and vertical growth across Africa will pave the way for genuine economic development.

Finally, while positive policy direction is essential, the ultimate responsibility lies with the people. Reflecting on the European Union’s success, we understand that it was the collective effort of activists, freedom fighters, parliamentarians, and politicians that paved the way for policies that benefited all. Similarly, we must all embrace and support these policies, enabling the trickle-down effects to materialize and witnessing the remarkable growth of our beloved continent. Undoubtedly, this is Africa’s decade, and ETK Group is thrilled to be part of this journey.

Together, let us seize this momentous opportunity, leverage the AfCFTA’s potential, and build a prosperous future for Africa.

Empowering Agribusiness & Development through Institutional Capacity Building: Insights from Michael Odeh, ETK Group’s PMO Lead in Nigeria

Today we speak to Michael Odeh, our Project Management Office (PMO) Lead based in Nigeria. Michael, who is an Agribusiness & Development Professional, tells us more about the progress we are making on the WOFAN and EYiA initiatives funded by the Mastercard Foundation and why Institutional Capacity Building is at the heart of the projects’ early successes.
Questions:

Tell us more about the Integrated Community-led Network (ICON 2) project championed by the Women Farmers Advancement Network (WOFAN), and the Enterprise for Youth in Agriculture (EYiA), an effort of Soilless Farm Lab. What is the duration of the projects?

The Integrated Community-Led Network project (ICON-2) implemented by the Women Advancement Network (WOFAN) is a scale-up of the ICON of Hope project, which focused on COVID-19 recovery and resilience building for smallholder farmers to cope and thrive in the face of COVID-19 triggered shocks and stressors.

The ICON-2 project is a five-year initiative running from 2022–2027 that seeks to support 675,000 youths across nine states in Nigeria with access to improved livelihoods, and dignified and fulfilling employment opportunities in the agriculture sector.

The Enterprise for Youth in Agriculture (EYiA) is a project implemented by Eupepsia Place Ltd (also known as Soilless Lab). The project focuses on expanding economic opportunities for about 30,000 Nigerian youth (especially young women) using climate-smart, digitally-enabled technology-based systems.

The goal of EYiA is to promote all-year-round vegetable production using hydroponics technology on small parcels of land. The project will be implemented over a three-year period (2022-2025) in Awowo, Ogun State, at the Eupepsia Farm Facility. Produce from the initiative is anticipated to meet market demand for premium vegetables in the nearby urban and peri-urban cities of Lagos and Ogun State.

Both projects are funded by the MasterCard Foundation.

What role is ETK Group playing in the delivery of ICON 2 and EYiA?

ETK Group is one of the key project partners supporting both the ICON-2 and EYiA projects under the MasterCard Foundation’s Young Africa Works strategy. We are providing Project Management Office (PMO) support to ensure effective coordination and administration of the projects.

In particular, the ETK Group is providing Institutional Capacity Building and governance support to all the project partners in an effort to ensure smooth implementation, the achievement of project objectives, and the management of key risks.

As a leading consulting firm that specialises in supporting businesses seeking entry into the African market, ETK Group will also support WOFAN and EYiA with enterprise expansion systems for market development opportunities and services that will ensure the projects scale up and access international markets.

Why does Institutional Capacity Building matter for developing projects, especially in Africa?

Development institutions such as Civil Society Organisations (CSOs) and local Non-Governmental Organisations (NGOs) play a critical role in addressing some of the major world problems such as poverty, hunger, and disease, especially in Africa.

To effectively tackle these challenges, it is crucial to provide development organisations with the essential skills and support systems to improve their ability to meet the needs of communities and entire nations.

This is where Institutional Capacity Building (ICB) becomes vital. ICB enhances organisational capabilities to efficiently deliver the requirements of a development project in terms of impact, cost-effectiveness, and overall management.

ICB, therefore, is an essential ingredient in achieving sustainability and ensuring the community successfully owns the project. Further, a significant part of ICB considers human capital development and organisational structural system strengthening, thus enabling institutions to meet stringent donor expectations in the delivery of development projects.

With enhanced capacity, development organisations and funding partners can ensure that good intentions translate into real, measurable impact for the community.

How many farmers and processors have you onboarded for ICON 2, and how many students for EYiA? What is the target number for each project? What role has ICB played in ensuring you hit/exceed the targets?

The ICON-2 and EYiA projects’ target was to onboard 225,000 and 4,000 beneficiaries and partners, respectively, for the first year.

By the end of January and February 2023, respectively (the projects’ first quarter), a total of 239,875 farmers and processors had been onboarded, which was 6% above target.

Further, a total of 1,000 partners were integrated into the EYiA project in the same quarter. The EYiA initiative target is to register 1,000 students or partners per quarter, and recruitment for Quarter 2 is currently ongoing.

Robust deployment of ICB measures has ensured effective coordination with partners and periodic alignment on project targets. The PMO has been a key driver in ensuring project targets are achieved (or surpassed) within the period.

At the end of the projects, what impact do you foresee for both?

Both the ICON-2 and EYiA projects seek to increase food security and improve the livelihood of youth by creating sustainable and dignified employment opportunities, especially for women.

I envisage that more young people will be actively engaged in economic activities in the agricultural and allied sectors, with an ever-increasing number of these being women-owned micro and small-scale enterprises.

This should lead to a significant drop in youth unemployment and a drastic change in the economic landscape of the local communities where these projects are being implemented.

As a leading consulting firm that specialises in supporting businesses seeking entry into the African market, the ETK Group has established a strong reputation in the trade and development sectors. In addition, we have now expanded our services to include Institutional Capacity Building (ICB) for development projects in Africa.

At their core, development projects seek to transform communities and bring about positive change. Good intentions, however, are not enough to guarantee success. To make a lasting impact, it is necessary to focus on building institutional capacity in the organisations and communities involved in the project. This means building and fortifying the skills, knowledge, and resources to effectively plan, implement, and sustain the project over the long term.

From improving governance structures to strengthening financial management systems, building institutional capacity is a critical component of any development effort. In this article, we will explore the importance of institutional capacity building in development projects, and how it can help ensure that good intentions translate into real, measurable impact on the ground.

Billions of dollars are spent annually on financing development projects in developing countries. For example, in 2022, the African Development Bank’s Africa Investment Forum 2022 drew US$31 billion in investor interest to help unleash Africa’s investment potential in critical sectors. These include infrastructure, agriculture, energy, education, creative industries, sports, and transactions that champion women entrepreneurs. 

Within the same period, The European Bank for Reconstruction and Development delivered a record €13.1 billion (US $14 billion) in investments to its regions in 2022. The Mastercard Foundation is also investing US$ 200 million in its Young Africa Works strategy to ensure that by 2030, 30 million young people in Africa, especially young women, will secure employment they see as dignified and fulfilling. 

Effective execution and sustainability of development projects require expertise in managing human, infrastructure, and financial resources. Institutional Capacity Building (ICB) is the solution to this need.

But what exactly does ICB entail, and why is it so critical for the success of development projects?

ICB focuses on empowering institutions like governments, NGOs, and community-based organisations, to effectively plan, implement, and maintain development programmes and projects. It’s a critical component in ensuring long-lasting and impactful outcomes that benefit stakeholders in the community.

Last month, we were thrilled to announce that the Mastercard Foundation had appointed us to deliver Institutional Capacity Building (ICB) for the Integrated Community-led Network (ICON 2) project championed by the Women Farmers Advancement Network (WOFAN) and the Enterprise for Youth in Agriculture (EYiA), an effort of Soilless Farm Lab.

Typically, our ICB framework consists of the following four key components:

1. Assessment:  An ICB strategy starts with assessing and comprehensively evaluating an organisation’s current strengths and weaknesses. At this stage, an organisation’s priorities and goals for capacity building are also determined.
2. Planning: This involves pulling together specific strategies, activities, and resources to address the gaps in the identified areas. The plan should be designed to meet the organisation’s unique needs and context.
3. Implementation: This is the execution of the outlined activities. These may include training, mentoring, coaching, technical assistance, and other types of support to develop the necessary skills, knowledge, and systems for effective functioning.
4. Monitoring and Evaluation:  This involves tracking progress against the objectives of the plan. This element ensures that the organisation is making progress towards its goals.

Without ICB, organisations may struggle to deliver successfully on the project, offer poor services, and fail to achieve their goals. As a result, these lead to a range of negative outcomes, including inefficient and ineffective operations, limited impact in the community, poor governance and accountability problems, and reduced sustainability.

WOFAN and EYiA programmes are backed by robust ICB plans. Our goal is to strengthen the capacity of women and youth farmers through climate-smart, digitally-enabled farming for the socio-economic benefit of beneficiaries and their families.

We are excited to be a part of these important initiatives and to work with other organisations dedicated to improving the lives of those in Africa’s agriculture sector.

Photo: A Soilless Farm Lab project beneficiary – Photo Credit: Soilless Farm Lab via their website.

At ETK Group, we join the world in recognising the efforts made by women in our company and across the globe for the betterment of business, community, and humanity.

This year’s IWD theme, DigitALL: Innovation and Technology for Gender Equality, is particularly exciting for the ETK Group.

The Mastercard Foundation recently appointed our firm as the project manager for two exciting agriculture initiatives in Nigeria. The Integrated Community-led Network (ICON 2) led by the Women Farmers Advancement Network (WOFAN), and the Enterprise for Youth in Agriculture (EYiA) – an effort of Soilless Farm Lab.

In both cases, the Mastercard Foundation, through its Young African Works strategy , seeks to strengthen the capacity of smallholder farmers through climate-smart, digitally enabled farming. Both projects focus on women and youth, reinforcing their critical role in agriculture. By improving crop yields and creating access to markets, beneficiaries of ICON 2 and EYiA programs can secure sustainable livelihoods for the benefit of their families, communities, and country.

While this is our maiden venture into project management for development initiatives, we are no strangers to building institutional capacity and governance. Since our inception in 2010, over 200 businesses worldwide have successfully launched in Africa, thanks to our unparalleled understanding of the continent.

We bring a private sector-oriented, commercially focused angle to project management and governance in the development sector. This approach recognises the importance of using sound business practises and principles in designing and implementing development projects.

The role of agriculture in Nigeria cannot be overstated. The Food and Agricultural Organisation (FAO) noted that between January and March 2021, the sector contributed 22.35% of the total gross domestic product. Over 70% of Nigerians engage in the agriculture sector, mainly at a subsistence level.

The Consultative Group on International Agricultural Research (CGIAR) estimates that 43% of the global agricultural labour force comprises women. In the least developed countries, two in three women earn a livelihood from farming.

In Nigeria, that 66% goes up to over 70%. The Civil Resource Development and Documentation Centre (CIRDDOC) reports that women smallholder farmers constitute 70–80% of the agricultural labour force at the subsistence level.

CIRDDOC adds, “Women produce the bulk of food for domestic consumption and are the drivers of food processing, marketing, and preservation. Despite this enormous task, they have limited access to land, credit facilities, farm input training and advice, technology, and crop insurance, among other things. Women small farm owners own only 14% of the land on which they farm.

The FAO further notes that, despite its contribution to the economy, Nigeria’s agricultural sector faces many challenges that impact its productivity. These include poor land tenure systems, low levels of irrigation farming, climate change, and land degradation. Other factors include low technology, high production costs and poor input distribution, limited financing, high post-harvest losses, and limited market access.

These challenges have resulted in women having lower yields than their male counterparts, limiting their ability to provide for their families and contribute to the national economy.

Unfortunately, even with the prevalence of digital technology on the continent, women are often excluded from accessing these tools due to social and cultural barriers, such as a lack of education and financial resources. This exclusion puts women at a significant disadvantage, limiting their ability to compete in the market, therefore negatively affecting their economic and social status.

However, the potential for women in agriculture in Nigeria is enormous. Women deeply understand the local ecosystem and play a critical role in ensuring that agricultural practices are sustainable and environmentally friendly. By empowering women and providing them with the necessary resources, they can become key players in the farming sector and drive economic growth in Nigeria.

Furthermore, technology has the potential to revolutionise agriculture in Nigeria by making it more efficient, productive, and sustainable. Women farmers can adopt intelligent agriculture solutions that leverage technology to help them optimise crop yields, reduce waste, and create proactive solutions to tackle climate change and assure food security.

At ETK Group, we believe this year’s IWD clarion call is a game-changer for women in the agricultural sector.

We can’t wait to see the possibilities digital technologies deployed in ICON 2 and EYiA will unlock in Nigeria on the road to achieving Sustainable Development Goal 2 (creating a world free of hunger by 2030).

Photo: A Soilless Farm Lab project beneficiary – Photo Credit: Soilless Farm Lab via their website.

The COP27 proceedings concluded on Sunday, 20th November in Sharm El-Sheikh, and communiques from all working groups are being finalised. In the meantime, draft versions are available for review, and the outlines of major decisions are becoming clear, as well as the major decisions that have been delayed for consideration until COP28 which will take place next year in Dubai.  In today’s post, we will review some of the major decisions that were reached during this year’s proceedings, while also considering what steps are needed to achieve the goal of limiting the effects of climate change to 1.5 degrees centigrade.

Reaffirming commitment to 1.5 degrees

First, it’s important to recognize that the commitment to limiting warming to 1.5 degrees was not a forgone conclusion. There was genuine concern among many participants that the commitment to 1.5 degrees would be abandoned. Scientists consider 1.5 degrees to be the level at which we can avoid the worst impacts from climate change. 

In order to achieve this target, we must drastically reduce our dependence on fossil fuels, beginning immediately. However oil producing countries and representatives from the fossil fuel industry who were present at COP27 resisted calls for reductions in the use of fossil fuels, and successfully kept any mention of limiting use of fossil fuels out of the final statements. Without a clear path forward on reducing the use of fossil fuels, the target of 1.5 is largely unachievable.

The compromise language that was finally agreed to instead focused on the reduction in harmful greenhouse gas emissions without addressing the underlying cause of those emissions, which is primarily the burning of fossil fuels. However, in the end – participants reaffirmed the commitment to 1.5 degrees, and that commitment is reflected in the draft statements. 

The Revised Advanced Version of the Sharm El-Sheikh Implementation Plan which was distributed on November 20 reaffirms this commitment.  The language in Paragraph 7, Section I on “Science and Urgency” states that the Conference of Parties “Reiterates that the impacts of climate change will be much lower at the temperature increase of 1.5 °C compared with 2 °C and resolves to pursue further efforts to limit the temperature increase to 1.5 °C”. The precise mechanisms for achieving this will be decided in subsequent discussions.

Lack of progress on phase out of fossil fuels

Overall, the conference was considered to be a disappointment when it comes to mitigating against the underlying causes of climate change. While there were commitments to reduce the use of coal, the final statements do not address the use of all other fossil fuels. Countries including India, the EU and its member states, as well as the US had been pushing for a more rapid transition to renewable sources of energy, and a phase out of all fossil fuels, with emissions peaking in 2025. The push for the rapid phasing out of fossil fuels was abandoned in order to not risk what was seen as the major accomplishment of the conference, which was the agreement on the creation of a loss and damage fund.

Agreement on creation of loss & damage fund

As we discussed in one of our earlier postings, the issue of compensation for loss and damage for the most severely impacted countries was expected to be one of the key areas of focus throughout the proceedings. This was indeed the case, and in the end, agreement was reached among all participants on the creation of a loss and damage fund to assist developing countries in dealing with the impacts of climate change. While the precise details for implementing and capitalizing the fund were left for further study and consideration over the coming year and at COP28, the agreement on the creation of the fund was seen as a major victory for climate justice and for the most severely impacted developing countries.

How will we meet our emissions reduction targets?

In order to achieve the target of limiting temperature increases to 1.5 degrees, GHG emissions must be reduced by 43 percent by 2030. As discussed above, COP27 made very little progress in addressing precisely how these reductions will be achieved. In spite of reductions in emissions that occurred during the global pandemic, emissions rose again in the past year. And on Friday, scientists indicated that global emissions are set to rise 1 percent this year, even as time is running out for the significant reductions needed to keep global warming within the 1.5 degree target.

The fundamental challenges remain the same as they have been since the initial discussions on reducing global dependence on fossil fuels some 30 years ago, and the inherent conflicts remain largely unresolved. Namely, how to achieve sufficient reductions in emissions from the heaviest polluting countries in the developed world while helping to finance the shift to renewables in the developing world, without impacting the economic growth necessary for continued progress on poverty reduction. So far, there haven’t been sufficient reductions in dependence on fossil fuels in the developed world, and the financing necessary for helping the developing world achieve a transition to renewable sources of energy hasn’t been forthcoming.

Just Energy Transition Partnerships

One of the areas for optimism coming out of COP27 was actually announced at the G20 meeting which overlapped with the final week of COP27. The agreement for the development of a new Just Energy Transition Partnership (JETP) between Indonesia and a coalition of partners from the developed world was discussed during the COP27 proceedings and builds on the concept which was initially introduced in Glasgow at COP26. 

JETPs offer a way to mobilize funds from the developed world in a way that helps developing countries achieve their Nationally Determined Contribution range of CO2 reductions while also continuing to foster economic growth and alleviate poverty. The JETP with Indonesia will mobilize $20 billion in funding to help accelerate Indonesia’s transition to cleaner sources of energy, while facilitating ongoing economic growth.

The first JETP was agreed between South Africa and the EU, Germany, France, the UK, and the US. The agreement, which was announced at COP26 in 2021, resulted in the commitment of $8.5 billion over the following 3 – 5 years to help South Africa transition its energy sector to clean renewable sources of energy, decarbonise its energy intensive economy, help to create jobs, and foster economic growth.

What does this mean for Africa?

The challenges of reducing greenhouse gas emissions for many countries in Africa are amplified by the fact that a significant portion of economic growth is derived from extractive industries. Nigeria, Africa’s largest economy with an estimated GDP in 2022 of US$ 504 billion, derives approximately 9 percent of its GDP from oil. Just this past week, Nigeria began drilling an oil field that was discovered in 2019 in the country’s north with reserves of approximately 1 billion barrels. 

The oil field sits in the Kolmani area, between Bauchi and Gombe states in an area that has long been afflicted by extreme poverty and has in recent years battled an insurgency by Islamic militants. The discovery of the oil field promises to create an economic boom for the region and for the country, with expectations of building an oil refinery, a gas processing unit, a 300-megawatt power plant, and a fertilizer plant capable of producing some 2,500 tonnes of fertilizer a day.

Creating incentives to move away from a fossil fuel-based economy is incredibly difficult, and simply insisting that a country like Nigeria forgo the economic benefits of something like the Kolmani oil field is unrealistic. The hope is that Just Energy Transition Partnerships can be one tool to help drive the decarbonization of economies in the developing world.

Much work still to be done

While there is still much to be done, and while COP27 in many ways “kicked the can down the road” in addressing clear mechanisms for achieving the necessary reductions in GHG to meet the 1.5 degree target, the demonstrated commitment to helping the most impacted countries through the creation of a loss and damage fund was an encouraging step forward, and the commitment of funds and resources to the JETP in Indonesia offers another bright spot coming out of the proceedings.

In our final post, we will look at some of the emerging trends, leaders, and frameworks coming out of COP27, and how they are likely to take shape over the coming years.

Brent Barnette is a Non-Executive Director with ETK. He helps lead our focus on issues relating to sustainability, ESG reporting in Africa, and climate change.

If you’d like to discuss how ETK Group can help you achieve your climate change goals, please email us at admin@etkgroup.co.uk