Applying Local Content Policy in Construction Industry

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Buoyed by the successful implementation of the local content policy in the oil and gas sector, the Nigeria Institute of Architects is canvassing for its extension to other sectors of the economy

By Anayo Ezugwu  |  Sep. 1, 2014 @ 01:00 GMT  |

THE successful implementation of the Nigerian content policy in the oil and gas sector is spurring other sectors of the economy to want to do same. For instance, the Nigeria Institute of Architects, NIA, is canvassing for the passage of the local content bill in the construction industry. Fidelis Ugbo, secretary, National Planning Commission, agrees. He said while delivering a keynote address at the 2014 quarterly dinner organised by the Abuja chapter of the NIA, that the construction industry should aim to replicate the successes achieved with the Nigerian Content Act in the oil and gas industry.

He said the construction industry was regarded as the barometer for measuring the health of any economy, regretting that Nigeria’s construction industry, which gulps over 80 percent of the capital budget of all tiers of government, had been dominated by expatriate companies since independence. Ugbo, has no doubt whatsoever that the excellent performance of Nigerian service companies in the oil and gas sector can be replicated in the construction industry. This, he argued, would “correct the impression that local companies are incompetent, mismanage funds collected for projects and are unable to buy construction equipment required to execute most heavy construction and engineering projects.”

According to him, the federal government took a bold step in this direction when Mike Onolememen, minister of works, announced in 2013 that all engineering and construction projects below N5bn would be handled by Nigerian contractors who possess the requisite capacity. “This was intended to reverse the domination of Nigerian engineering and construction industry by expatriates. A Presidential declaration was made to give jobs to local manufacturers and contractors even if their quotations are 10 to 15 per cent higher than those of expatriates,” he said.

Ugbo further explained that the Local Content Bill in the construction industry modelled after the Nigerian Oil and Gas Industry Content Development, NOGICD, Act, is awaiting passage by the National Assembly. He said the Bill would boost employment opportunities and promote local trade in building materials as well as ensure that the nation’s architects, engineers and other professionals in the industry are effectively utilised.

Johnson
Johnson

The secretary charged members of the National Assembly to ensure a quick passage of the bill and canvassed that foreign goods be discouraged in the industry with the application of appropriate fiscal measures. The ministry of communications technology and the ministry of power had, in the past weeks, made strident moves to adopt local content models in the operations of their sectors.

Remarkably, Omobola Johnson, minister of communications technology, set up the office of national content, ONC, within the National Information Technology and Development Agency, NITDA, with a mandate to draw up template guidelines and policies to be put in place by the Nigerian Content Development and Monitoring Board, NCDMB, for the ICT sector.

Chinedu Nebo, minister of power, also convened a Power Sector Local Content Policy Framework Development Workshop. At the workshop, he promised to ensure that the ongoing transformation in the sector and massive investments by governments and the private sector entities were steered to develop the local supply chain and encourage manufacturing.

Nebo commended Diezani Alison-Madueke, minister of petroleum resources, and the NCDMB for the achievements recorded with the implementation of the Nigerian Content Act in the past four years. He stated that the power sector would be looking to adapt the policies and guidelines put in place by the NCDMB in the oil and gas sector, adding, “we do not need to reinvent the wheel in the power sector.”

On her part, Alison-Madueke also commended the NCDMB for the achievements it had recorded within its four years of existence and that its success had underscored the adoption of the Nigerian content philosophy by other sectors of the economy as further proof that the implementation of the Nigerian Content Act has been effective. “The fact that Nigerian Content policies are about to be deployed in various parts of the economy and ministries as well want to copy and learn from the Ministry of Petroleum Resources is one of the things we can be actually proud of.  It is one of the strengths of the oil and gas sector in the President Jonathan’s administration and we are very pleased with it,” she said.

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