Could you briefly introduce us to Siemens in Nigeria and the sectors in which you are focusing?
Nigeria is one of the most important markets in Africa for Siemens. Siemens has been active in Nigeria since the 1950s, and established its first Representative Office in the country in 1970.
As you may well know, Siemens is organized in four sectors: energy, industry, healthcare, infrastructure & cities.
Our focus in Nigeria is the energy sector. As you may well know, energy generation is very weak and the country needs to build on its generation capacity. On the transmission and distribution side there need to be more investments as well. At present we are the only company involved in all sectors: generation, transmission and distribution.
In terms of focus and business units; how do you operate in Nigeria taking into account the vast work needed and opportunities existing in the country?
We cannot be everywhere with every single portfolio element. This happens everywhere in the world. We have different strategies for every business unit. In the industry sector & healthcare sectors we work via partners; training and educating Nigerian companies which eventually become our partners.
We provide administration but actual work is done by local partners.
Projects in third world countries tend to start from a white paper. In this sense, consulting governments on feasibility and potential is key. How is Siemens working in this sense?
We have a very long history in Nigeria; we have not started recently, almost 50 years ago. Consulting is a prerequisite to sell product solutions for a multinational company. Our aim is not just to sell something for the short term profit, but to keep our customers happy and engaged in the long run. That is why we need to make sure our products and solutions are the right ones.
The Honorable Minister of Power mentioned to us during an interview that he thinks the privatization of the power sector will equal the success achieved with the privatization of the telecoms industry. What is your take on this?
This privatization is the reason why we are focusing in the power sector. It is not that easy to compare both processes. The power sector privatization requires heavy investment in fixed assets. Massive generation capacity needs to be built in the order of billions of dollars. Also transmission stations, lines, buffer stations, distribution centers.
With so many things to do in Nigeria and so much potential; what is your strategy towards identifying suitable projects for development in order to maximize profit and make an adequate use of resource management?
We identify which potential customers are serious enough. Opening the market for independent power producers has led to a fever in which everybody wants to build a power plant. We can supply turn-key power plants so we have a big competitive advantage in this market. The construction of Geregu II plant is an example of this: The project was completed on budget, on time (in two years), and in compliance with the highest ethical, environmental, health, and safety standards.
We try to walk the line of building projects from an early stage. We cover feasibility studies, development and financing activities together with our clients.
Nigeria is set to become “the next Brazil”. Many people share this opinion, what could you tell us as MD of a leading multinational company operating in the country?
From a potential perspective, and taking into account macroeconomic indicators: population, GDP growth, location, natural resources (oil, mining industries), Nigeria is the perfect country to become the next powerhouse on a global basis.
It is extremely important to have administration and security for private investments. If this is not set up properly countries will fail. You have examples around the world of things going in the wrong way. Nigeria should continue promoting and attracting private investment and provide security, transparency and enforcement of legislation. For Siemens these are the three main areas.
We have seen collaboration between the EU, the German Government and multilateral institutions with Africa in general and Nigeria in particular. Could you share your experience in this matter with us?
This is a very positive signal. The EU/World Bank/Development Banks are very willing to support Nigeria. The Azura-Edo IPP project, a new project in which we will be participating, has shown the interest of international organizations on Nigeria. This represents a large privately funded project in Nigeria, hopefully transcending to other sectors as an example.
Any country cannot achieve economic success alone. There needs to be support from the financing, technology and political sides for societies to advance.
There is a long dating presence of German firms in Africa: Nigeria, Cameroon, etc. always very well regarded. What do you think is the potential for German firms. Not only multinationals, but as most of your suppliers are middle sized companies, how do you envision your development here in the country in terms of opportunities for your supply chain in Germany?
I hope we see more European and international companies coming to Nigeria. It is usually the first step when multinational companies arrive in a country but then it is more important to establish local value chains in country. This can happen with small medium enterprises coming to the market. Some are risk averse, others do take risk. This is a traditional entry barrier.
Nigeria provides a fruitful ground for successful business, and the potential to help Nigerian companies to level up in terms of competence. This can increase local value production and contribute towards reducing imports and making the country more independent.
Do you identify yourself with Nigeria? And SIEMENS?
From a personal perspective it is crucial for me to identify myself with the country. As a multinational company we have a responsibility. Siemens is the leader in compliance worldwide. Nigeria may not have the best reputation in compliance, yet we are here working, trying to roll-out and showing the world that one can develop business in a transparent, efficient and environmentally friendly manner.