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By Fred Itua, Abuja
Chief Kenneth Ifekudu (Agbalanze Onyekachukwu na Ozubulu), is the Managing Director of Diamond Leeds Ltd. His company is engaged in infrastructure design and development, energy services, engineering services, training services and consultancy services, among others.
In thus interview with Saturday Sun, the entrepreneur from Anambra State spoke on procurement mess in Nigeria, contracting, policies of President Bola Ahmed Tinubu, among others.
You were a banker before venturing into construction and business. What informed your decision?
I’m an advocate of home. I love Nigeria so much. I can’t be part of the people who always consider travelling or relocating abroad. As a person, if you don’t have passion for whatever you’re doing, you can’t get the right results. And when you don’t get results, that is where the thought of relocating abroad will come in. But if you have the passion, no matter what, you’ll succeed. Even a diligent cleaner will transform from that job to become a supervisor and one day own his or her own cleaning company. Everything boils down to passion. Passion gives you focus and when you have it, there is no way God will not reward you. My story is different. I started as a banker. And I had a lot of customers who were into construction. They were my top customers. I told myself that the day I’ll leave banking, I’ll settle for contracting as a business. But getting it is not easy. It requires a huge capital. But when you’re there, you’ll get your heart desires if you don’t give up.
With the unreliable government policies, how have you managed to remain in business?
It has not been easy. Procurement processes in Nigeria is something else. Let me give you some instances. As at Wednesday, September 13 2023, one dollar was exchanging for N934. I buy dollars every day. Imagine you were given an award to construct a road. Let’s say the cost of constructing one kilometre is N240 million. With the way the cost of asphalt is rising, matching the cost with the realities on ground will be impossible. That’s why you see substandard roads and you see buildings collapse. People are trying to cut corners. Government is not helping matters. Imagine the 2023 budget. We’re in September and the government has only made one release for capital projects. And they released only 20 per cent. Go and verify. Most of the contracts awarded are not getting releases. Government is not even talking about the 2023 budget, rather, they’re more interested in the supplementary budget of 2023. They feel that the current budget was not initiated by them. These inconsistencies are killing people’s businesses. Some contractors moved to sites believing that funds will be released. For someone like me, I had gone far with some jobs, thinking there will be releases. I had to stop and manage my losses.
How does the exchange rate affect local construction of roads?
It does. The prices of cement in the South East is N7,200. In Abuja, it is N4,700. In Delta State, it is different. I designed and built Federal Polytechnic, Orogun in Delta State. A bag of cement there is N7,200. It affects us badly.
Are materials used in producing cement not sourced locally?
That was the same question the Minister of Works, David Umahi asked. He has challenged Dangote that if he doesn’t crash the prices of cement, he will import them. All the components used in producing cement are sourced locally. The man who imports cement to Togo gets it at a cheaper price. But here where all the materials are sourced locally, the prices are higher.
FCT Minister, Nyesom Wike has faulted the procurement system in Abuja. For him, he said it is better to budget for a particular project, finish it and move on to another one. He said this will knock off the issue of contract variations. Do you agree with him?
Wike’s option is the best way to go. Getting a job half done is not good for anyone. I weep for Nigeria. For instance, see the construction of rail lines that Chinese companies are handling. Without doing the railings, they rushed into constructing stations. They finished them and equipped them. They’ve been repeatedly vandalised. How can you go into a bush, construct a building and furnish it with no one to guide them? Commonsense would have been to do the tracks first, build access roads and conclude other things before embarking on building stations. You built the stations first before doing the main job. These are missed priorities. If you want to do a project, focus on one per time. That is where capacity comes in. I like what Wike did in Rivers State when he will pay about 80 per cent of contract sum to the contractors. You could only do that because you knew the contractors had capacity. If contractors know that there is money, they’ll go all out and do the job. I think government should subscribe to the options suggested by Wike. It’s the best way to go.
As contractors, are there forums where you can lead an advocacy for ideas like these to be implemented?
It is difficult to put contractors together. There are categories and too many people. Even people who can’t write names are contractors. There was one time the Ministry of Environment nominated my company to construct a bridge in Gombe State. It made headline news. I don’t like attending flag offs of construction. But they insisted that I must come. The first leg of the payment was N420 million. That was about five years ago. I didn’t ask for mobilisation. I had gone far. But a permanent secretary sitting on the job diverted the money budgeted for it into something else. Because he knew he had about three months to go, he spent the money they were supposed to use in paying me on fumigation during COVID-19. He has left office and they’re still owing me. They said one time they paid me. Only for me to check and I saw a payment of N2.1 million. How can I notice such a payment. Imagine I didn’t have anything to fall back on, I would have relocated to the village or suffered from high blood pressure. Government needs to make serious policies to protect our procurement system.
I am suffering the same fate in the Ministry of Niger Delta Affairs. There is a job of N900 million I’m doing. I’ve moved to site and have gone far. They’ve raised certificates and no payment. After this, I’ll write to government and exit the project. They gave the contract to three companies. The other two absconded. I’m the only one still there. In total, the Federal Government is owing me over N6 billion. There is no hope of getting that money back. Indigenous construction companies are folding up because of debt. Policies of government are responsible for this. If funds are released for a particular project, it should he kept and not diverted to other projects. You can’t give out letters for jobs and not have financial backing. We enjoyed this during President Goodluck Jonathan, with Okonjo Iweala as Minister of Finance. She insisted on due process. She will insist that for any award letter given, there must be money to conclude the project. A contractor can borrow, knowing well that he will be paid afterwards.
How do we get out of this procurement mess?
What the Ministry of Works is owing contractors is about N11 trillion. That’s just one Ministry. Everything boils down to legislation. Our lawmakers need to step up and protect us. Indigenous construction companies are dying. We need to do something. It appears the foreign companies are doing well. They don’t care about executing good projects. See the kinds of projects some of those foreign construction companies are executing. They don’t know that the Nigerian Government doesn’t fund projects and they take advantage of this to execute substandard projects. Go to all the roads these companies are constructing. This approach is killing indigenous construction companies. Look at those old construction companies. They are out of business now because of this attitude. This is also because of debt. The National Assembly should make strong laws on procurement. They should legislate that before any award letters are given out, there must be 100 per cent financial backing. Funding of projects should be steady. Imagine government making first quarter releases in July. That is why projects are delayed and it gives room for civil servants to create loopholes and move these funds to other areas.
How would you rate some of the policies of President Bola Ahmed Tinubu-led administration?
Some of the policies are good. Results don’t come out immediately. Removing the fuel subsidy was one of the best policies, although the timing might have been wrong. Maybe the government should have waited for Dangote Refinery to start before removing the fuel subsidy. Taking off the subsidy will give the government enough funds to execute projects for the people. So, I fully support the policies of the current administration.
You’ve done a lot for your people in terms of philanthropy. What pushes you to do this?
I’ll tell you something and it will amaze you. The kinds of text messages and calls I receive have serious negative effects on my health. They weigh me down. There are people who abuse opportunities. There are genuine ones I assist and I know how to handle them. I know that giving comes with its own blessings. I see myself getting inflows and I know that charity is in me. I derive joy in giving.
Have you also executed some projects in your home state of Anambra?
Yes. Erosion was really eating deep into my church in my community. It was about a kilometre erosion control. I’ve given money to people to start businesses. I pay hospital bills. I’ve built a market in my town. I’m currently constructing a road in my community. I share solar lights. I support security in my place. I’ve donated a vehicle to security outfits in my community. The records are there for the people to see.
