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Exploring woodwork for job creation

The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) is embarking on the conversion of industrial development clusters across the country into parks. In Abuja, the Federal Capital Territory, the agency is on the verge of completing a furniture and wood enterprise project to accommodate 525 furniture making cluster, ABDULWAHAB ISA reports

Nigeria’s economy managed to wriggle out of recession with an unimpressive GDP growth of 0.11 per cent in fourth quarter of 2020, reports of NBS. That minimal growth, which lifted it from recession, came from the non-oil sector. According to NBS, the non-oil sector grew by 1.69 per cent in real terms.

The mark was slower than 2.26 per cent recorded in the corresponding quarter of 2019, but better than the –2.51 per cent growth rate recorded in the preceding quarter. When full year 2020 GDP is contextualised, the non-oil sector grew –1.25 per cent compared to 2.06 per cent in 2019. Growth in non-sector was driven by information and communication (telecommunications & broadcasting), agriculture (crop production), real estate, manufacturing (food, beverage & tobacco), mining and quarrying (quarrying and other minerals), and construction, accounting for positive GDP.

In real terms, the non-oil sector contributed 94.13 per cent to the nation’s GDP fourth quarter of 2020, higher than the share recorded in the fourth quarter of 2019 (92.68%) and the third quarter of 2020 (91.27%). For 2020, the non-oil sector contributed 91.84 per cent to real GDP, higher than 91.22 per cent recorded in 2019. However, an aspect of non-oil sector that remains largely untapped, with potential of improving economic growth, is wood and furniture sector.

Wood sector as goldmine

NBS’ latest GDP Q4’20 report put wood and wood products under manufacturing. The sec-tor contracted by -3.17 per cent in Q4’20 from – 5.12 per cent in Q3’20 and 1.75 per cent in Q4’19. Similarly, the report stated that wood and wood products contracted by -4.29 per cent in full year 2020 from 1.93 per cent in 2019 and 1.7 per cent in 2018. The contribution of wood and wood products to the overall GDP growth is not impressive. The sector has untapped economic potential. It can generate jobs if given maximum attention, focus. Take the trees for instance. Nigeria’s forests are blessed with varieties of them. Trees and their derivatives include but not limited to assorted furniture for home uses, offices, hotels and class/lecture rooms across layers of institutions of learning. Contemporary construction of tall buildings from timber, in whole or in part, suggests a growing interest in the potential for building with wood at a scale not previously attainable. Regrettably, and unfortunately too, the country gives scant attention to wood and its bi-products. The lack of interest whittles down economic potential, opportunity and mileages the country could reap both in job creation and foreign exchange earnings.

SMEDAN’s foray into furniture factory

Spotting untapped economic potential in wood, furniture making sector and attendant positive effects on employment opportunities for Nigerian youths, Small and Medium Enterprises Development Agency of Nigeria, SMEDAN applied African Development Bank’s (AfDB) grant of $600.000 (N228.3m) to conduct a viability study for the conversion of the Industrial Development Clusters across the country into cluster parks. Conducting newsmen on guided tour of Idu, Abuja-based of SMEDAN’s furniture cluster complex recently, the agency Director- General, Dr Dikko Radda, represented by Anthony Igba, Deputy Director, Department of Engineering Technology and Infrastructure, gave historical overview of a project nearing 80 per cent completion.

The facility tour was aimed at accessing the completion level and benefits of the ongoing SMEDAN furniture and wood enterprise cluster project. The cluster park is an agglomeration of enterprises in a geographical location to promote development of MSMEs for economic growth.

The Abuja pilot scheme, sitting on 1.8 hectares of land, comprises an administrative block with one-stop-shop, workshops, warehouses is expected to accommodate 525 MSMEs when operational. The project, Igba said began in 2020, adding that the pilot project would be completed tentatively at the end of 2021, based on availability of funds. He recalled that the African Development Bank (AfDB) provided a grant of $600,000 (N228.3m) for SMEDAN to conduct a viability study for the conversion of the IDCs across the country into cluster parks.

He noted that in the bid to make the IDCs functional, SMEDAN conducted a viability study in 2018 to ascertain if they are viable in Nigeria with comparative advantage for marketability in huge markets, hence Abuja was chosen for the pilot furniture project.

Economic potential

Economic potential of woods and by extension furniture and its auxiliary products is huge. However, the enormous gains located in the sector, job creation, source of earning foreign exchange and others benefits, were, hitherto, lost before now to government. A feasibility study of SMEDAN unearthed advantages inherent in supporting local furniture. Speaking with the media, Igba said in bid to make the IDCs functional, SMEDAN conducted a viability study in 2018 to ascertain if they are viable in Nigeria with comparative advantage for marketability in huge markets. Hence, he said Abuja was chosen for the pilot furniture project.

“The study showed that the conversion of the IDCs into furniture clusters will be a viable project and equally provide the type of infrastructure and machineries to be put in place to equip the entrepreneurs. This project will enable the MSMEs to come up with products that are competitive within the West African market region, it will take advantage of the African Continental Free Trade Area (AfCFTA). “Through this, there will be creation of jobs, employment and economy of scales by having a shared infrastructure and common facility.

“There will also be a One- Stop-Shop comprising SMEDAN and other regulatory agencies namely Standards Organisation of Nigeria (SON), National Agency for Food and Drug Administration and Control (NAFDAC) and Environmental Board” “The MSMEs that will be operational in the cluster will have easy access to product testing and certification, while it will provide machineries and facilities to enable quality products and competitiveness,’’ he said. He added that the MSMEs, especially those involved in furniture making, had been operating under a harsh environment.

He said relief beckons at them on completion of the cluster, which will meet global standards and provide a conducive environment for the MSMEs to thrive. “We will work with MSMEs associations and equally will provide the machinery needed to ease production,’’ he added. He said the government was using the cluster as a pilot scheme to demonstrate its workability, adding that it would be done under Private, Public Partnership (PPP) thereafter. There are 23 clusters across the country, on fast moving consumer goods, textiles, spices, leather and among others established based on the comparative advantage of the states.

Last line

Nigeria’s wood sector and furniture are untapped huge potential for job creation and foreign exchange earnings. SMEDAN management should extend similar projects to every state of the federation.

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