Why-are-businesses-and-their-owners-investors-relocating-from-delta-state
September 7, 2020 | News
WHY ARE BUSINESSES AND THEIR OWNERS/INVESTORS RELOCATING FROM DELTA STATE?
Without a doubt, Delta State, especially its urban cities like Warri and environs, have lost their glory as business hubs where all kinds of commercial economic and business activities/services used to thrive. And this is as a result of the massive exodus of companies and businesses from Delta State to other States like Lagos, Abuja, Port-Harcourt, etc. within the last two decades or so. Even prospective investors and technocrats are quite hesitant and scared of establishing any new or expanding existing businesses in Delta State. As such, Delta State, especially the oil city of Warri and environs, have become ghost towns of business activities and also less attractive to domestic and foreign investors.
We all have been witnesses, and we all know and have seen the socio-economic implications of Shell’s exit (which followed the mass exit of other oil companies as well), from Warri and the entire Delta State since 2012, which cannot be measured. In fact, it was reported in 2013 that Delta State was losing about one billion naira monthly from just taxes (which includes withholding and Income Taxes), as a result of Shell’s exit from the State, not to mention job/contract services opportunities. Shell’s exit from Delta State was like a bad omen, which has continued to send negatives signals about the State and its people, to other investors that are thinking of coming into the State to invest. The Delta State Government urgently needs to reverse this.
There are a lot of ‘man-made factors’ that has been responsible for this pathetic situation in Delta State. Top most on the list is increased insecurity and all kinds of criminal activities like kidnapping, armed robbery, and other violent crimes. And when ‘security assurance’ cannot be guaranteed in any society, no wise business man or woman/prospective investor will want to remain in such an unsafe environment. As a result of this, the businesses and companies in Delta State prefer to relocate to cities like Lagos, where the crime rate there is drastically decreasing due to the concerted efforts of the Lagos State Government. Related to the issue of insecurity in Delta State, is the issue of ‘youth restiveness’ (youth violence)/ community crises. Most of the idle youths in the State, have resorted to the habit of using every available opportunity to ‘extort’ money from land developers, oil and gas companies/Contractors, and business owners. Their quest in these extortions have made most of the communities in Delta State to be enveloped with one ‘community leadership crises’ or the other, leading to public disturbances and disorder. Thereby, making most communities in Delta State very ‘unconducive’ for companies and businesses to thrive.
Even the few businesses and companies that have decided to remain in Delta State, have relocated their families and loved ones to Lagos, Ogun State, etc. Another factor that needs to be factored here, which has also contributed to the relocation of businesses and companies from Delta State; is the disturbing ‘high cost of running businesses’ in Delta State, coupled with the high cost of living. The situation is so bad that presently, people have adopted the strategy to place orders/waybill materials/items they use in running their businesses. A very good example is that of motor spare parts ordered from places like Benin, Lagos, and Ogun States, since major spare parts dealers have all relocated from Warri, which has made the cost of these car spare parts quite costly in Delta State. The truth is, nobody will be comfortable to do their businesses in a ‘hostile and business-unfriendly environment’.
The Delta State Government is not helping matters with their actions and inactions. For instance, the Delta State Government’s indifferent disposition towards seeing to the development of the various Sea Ports in the State and make them viable by ‘partnering’ with private investors and the Federal Government, has further discouraged businesses to thrive in the State. In fact, it is as if the Delta State Government is deliberately killing the Sea Ports in Delta State by not doing the needful in partnering with the Federal Government and private investors to develop the Sea Ports and the make them economically viable. This has made Delta State no longer attractive and bubbling with business activities, unlike what we had in the past.
It might interest the Delta State Government to know that one of the main sources of Dubai’s wealth is from its prosperous maritime activities. It was once a modest fishing town, which by the twentieth century it had become an important trading Port because of its strategic location in the sea around the Middle-East, which attracted merchants from all over the region. Today, Dubai’s main cargo Port Jebel Ali is the busiest Port in the Middle-East and arguably the United Arab Emirates’ most valuable commercial asset. A big reason for the shipping terminal’s success is that its located inside the Jebel Ali Free Zone, also known as Jafza, which is spread over 57 square kilometers – making it the world’s largest economic Free Zone. It is more than twenty other industry specific Free Zones dotted around Dubai all set up by the Government. These Free Zones attract businesses with tax breaks, custom duty benefits, and no foreign ownership restrictions, all within a developed infrastructure that is run by an independent authority, helping streamline bureaucracy. Within Jafza are now several thousand companies, accounting for more than 20 percent of total foreign investment in the UAE. The zone employs close to a 150,000 people, helping to generate more than $80billion worth of trade, which accounts for 21 percent of Dubai’s GDP. All of this was made possible by its political ruler Sheikh Rashid Bin Saeed Al-Maktoum. Much of the development in Dubai and across the Emirates was facilitated by the British Government.
So, we can see that Delta State, which is strategically and naturally located around the sea, and blessed with the Warri, Sapele, Koko, Burutu and Okwagbe Sea Ports, can actually be turned into another Dubai in Nigeria if the Delta State Government take appropriate steps in this direction, by partnering with the Federal Government, foreign and domestic investors; to make these Sea Ports in the State economically viable with enormous maritime activities. This will not only bring about the needed development, it will also create so many employment opportunities for State’s youthful population.
Again, the deliberate refusal of Delta State Government to embark on the expansion/upgrade project of the Osubi Airstrip near Warri, to become a Standard Airport, is also adversely affecting the movement of business dealings between the State and places like Lagos and Abuja. People are today forced to travel to Benin just to take flight to Lagos or Abuja.
Another very vital factor contributing to the subject issue, is the lack of considerable power supply for businesses’ operations to thrive in Delta State, especially in the oil city of Warri and environs. Unless one is privileged to have the resources/money to connect to a 33KV line, which is far costlier than the regular power supply, one’s business will greatly depend on the use of petrol/diesel generators, and that is for also those who can afford it. For one to connect to the 33KV, one must also buy a special transformer since the Benin Electricity Distribution Company (BEDC) is not providing it for consumers to use. All of this have added to the high cost of production for businesses to contend with, which leaves the consumers at the end to bear the high cost of things in the State. Adding to this problem, is the gross lack of motorable roads in most parts of Delta State, particularly in Warri and environs, which is regarded as the ‘commercial hub center’ of the State. Those government officials, whose responsibility it is as politicians/public office holders in the State, have not been faithful as they should in constructing and maintaining vital road networks across the State. This attitude of a government, is more evident in the current Governor Ifeanyi Okowa led administration. They do not construct or maintain street roads that are not in areas where politicians, top government officials and top PDP officials live in.
We believe the construction and maintenance of road networks should not be politicized. All parts of Delta State, irrespective of tribes, need good motorable roads. Okowa is the Governor of Delta State and not a Governor of only PDP members. He is the Chief Executive Officer of Delta State and the responsibility to cater for all the needs of all in the State, is his statutory official duties. He contested as Governor to govern the State, hence it is his sole responsibility to live up to that expectation by catering for the social and security needs of Deltans and people living in the State.
With the above unfortunate prevailing circumstance in Delta State, there is no way we can aspire to develop or see the needed change if the appropriate steps are not taken and adjustments made. However, the Delta State Government should understand that most developed societies in the world jump-started their economies by accelerating their infrastructural development and building on it; examples being those of India, China, the United States of America, etc. The crux of this matter is that a State cannot be rich without good infrastructure and security assurance. All the great civilizations attained greatness only through the entrenchment of adequate and sustainable infrastructure and guaranteed security.
Governor Okowa should realize that he is the one in the Driver’s Seat and as such, the One-In-Charge of the State’s movement ahead in any direction. Whatever good or bad prevailing situations around the State will be attributed to him. It is Governor Okowa (not me), that will be the one who takes the glory and praise if he is able to transform the economic fortunes of the State and the living standard of the people. Same also, if he is not able to do this. But we believe he can transform Delta State if he really wants to. Those who transformed their societies do not have two heads. They are human beings and political leaders like the ones in Delta State presently. The likes of Peter Obi of Anambra State, Ahmed Tinubu and Babatunde Fashola of Lagos State, though, have left office, but the good legacies they left behind in the States still speaks well of them. Ambode, who is currently on the driver’s seat in Lagos State, is doing a great job and he is being applauded for it. It is the same we have the likes of Al-Maktoum of Dubai, Mao Zedong (chairman Mao) of China, etc., have transformed their societies with amiable legacies. Governor Okowa can do same in Delta State. So, let all the sycophancy and praising/commending the government for doing little or nothing – stop. Such praises will not help the State. Governor Okowa needs to deliver practically and not just showing off via media publicity stunts. Deltans need to see results and less talking and talking.
No magic or economic expert that can develop Delta State in the absence of basic infrastructure and guaranteed security. The provisions of these essential two factors, are not only part of what constitutes as development, but also the foundation upon which all other efforts towards development are made. Infrastructure and guaranteed security are a necessity for development to thrive.
Zik Gbemre, JP.
Without a doubt, Delta State, especially its urban cities like Warri and environs, have lost their glory as business hubs where all kinds of commercial economic and business activities/services used to thrive. And this is as a result of the massive exodus of companies and businesses from Delta State to other States like Lagos, Abuja, Port-Harcourt, etc. within the last two decades or so. Even prospective investors and technocrats are quite hesitant and scared of establishing any new or expanding existing businesses in Delta State. As such, Delta State, especially the oil city of Warri and environs, have become ghost towns of business activities and also less attractive to domestic and foreign investors.
We all have been witnesses, and we all know and have seen the socio-economic implications of Shell’s exit (which followed the mass exit of other oil companies as well), from Warri and the entire Delta State since 2012, which cannot be measured. In fact, it was reported in 2013 that Delta State was losing about one billion naira monthly from just taxes (which includes withholding and Income Taxes), as a result of Shell’s exit from the State, not to mention job/contract services opportunities. Shell’s exit from Delta State was like a bad omen, which has continued to send negatives signals about the State and its people, to other investors that are thinking of coming into the State to invest. The Delta State Government urgently needs to reverse this.
There are a lot of ‘man-made factors’ that has been responsible for this pathetic situation in Delta State. Top most on the list is increased insecurity and all kinds of criminal activities like kidnapping, armed robbery, and other violent crimes. And when ‘security assurance’ cannot be guaranteed in any society, no wise business man or woman/prospective investor will want to remain in such an unsafe environment. As a result of this, the businesses and companies in Delta State prefer to relocate to cities like Lagos, where the crime rate there is drastically decreasing due to the concerted efforts of the Lagos State Government. Related to the issue of insecurity in Delta State, is the issue of ‘youth restiveness’ (youth violence)/ community crises. Most of the idle youths in the State, have resorted to the habit of using every available opportunity to ‘extort’ money from land developers, oil and gas companies/Contractors, and business owners. Their quest in these extortions have made most of the communities in Delta State to be enveloped with one ‘community leadership crises’ or the other, leading to public disturbances and disorder. Thereby, making most communities in Delta State very ‘unconducive’ for companies and businesses to thrive.
Even the few businesses and companies that have decided to remain in Delta State, have relocated their families and loved ones to Lagos, Ogun State, etc. Another factor that needs to be factored here, which has also contributed to the relocation of businesses and companies from Delta State; is the disturbing ‘high cost of running businesses’ in Delta State, coupled with the high cost of living. The situation is so bad that presently, people have adopted the strategy to place orders/waybill materials/items they use in running their businesses. A very good example is that of motor spare parts ordered from places like Benin, Lagos, and Ogun States, since major spare parts dealers have all relocated from Warri, which has made the cost of these car spare parts quite costly in Delta State. The truth is, nobody will be comfortable to do their businesses in a ‘hostile and business-unfriendly environment’.
The Delta State Government is not helping matters with their actions and inactions. For instance, the Delta State Government’s indifferent disposition towards seeing to the development of the various Sea Ports in the State and make them viable by ‘partnering’ with private investors and the Federal Government, has further discouraged businesses to thrive in the State. In fact, it is as if the Delta State Government is deliberately killing the Sea Ports in Delta State by not doing the needful in partnering with the Federal Government and private investors to develop the Sea Ports and the make them economically viable. This has made Delta State no longer attractive and bubbling with business activities, unlike what we had in the past.
It might interest the Delta State Government to know that one of the main sources of Dubai’s wealth is from its prosperous maritime activities. It was once a modest fishing town, which by the twentieth century it had become an important trading Port because of its strategic location in the sea around the Middle-East, which attracted merchants from all over the region. Today, Dubai’s main cargo Port Jebel Ali is the busiest Port in the Middle-East and arguably the United Arab Emirates’ most valuable commercial asset. A big reason for the shipping terminal’s success is that its located inside the Jebel Ali Free Zone, also known as Jafza, which is spread over 57 square kilometers – making it the world’s largest economic Free Zone. It is more than twenty other industry specific Free Zones dotted around Dubai all set up by the Government. These Free Zones attract businesses with tax breaks, custom duty benefits, and no foreign ownership restrictions, all within a developed infrastructure that is run by an independent authority, helping streamline bureaucracy. Within Jafza are now several thousand companies, accounting for more than 20 percent of total foreign investment in the UAE. The zone employs close to a 150,000 people, helping to generate more than $80billion worth of trade, which accounts for 21 percent of Dubai’s GDP. All of this was made possible by its political ruler Sheikh Rashid Bin Saeed Al-Maktoum. Much of the development in Dubai and across the Emirates was facilitated by the British Government.
So, we can see that Delta State, which is strategically and naturally located around the sea, and blessed with the Warri, Sapele, Koko, Burutu and Okwagbe Sea Ports, can actually be turned into another Dubai in Nigeria if the Delta State Government take appropriate steps in this direction, by partnering with the Federal Government, foreign and domestic investors; to make these Sea Ports in the State economically viable with enormous maritime activities. This will not only bring about the needed development, it will also create so many employment opportunities for State’s youthful population.
Again, the deliberate refusal of Delta State Government to embark on the expansion/upgrade project of the Osubi Airstrip near Warri, to become a Standard Airport, is also adversely affecting the movement of business dealings between the State and places like Lagos and Abuja. People are today forced to travel to Benin just to take flight to Lagos or Abuja.
Another very vital factor contributing to the subject issue, is the lack of considerable power supply for businesses’ operations to thrive in Delta State, especially in the oil city of Warri and environs. Unless one is privileged to have the resources/money to connect to a 33KV line, which is far costlier than the regular power supply, one’s business will greatly depend on the use of petrol/diesel generators, and that is for also those who can afford it. For one to connect to the 33KV, one must also buy a special transformer since the Benin Electricity Distribution Company (BEDC) is not providing it for consumers to use. All of this have added to the high cost of production for businesses to contend with, which leaves the consumers at the end to bear the high cost of things in the State. Adding to this problem, is the gross lack of motorable roads in most parts of Delta State, particularly in Warri and environs, which is regarded as the ‘commercial hub center’ of the State. Those government officials, whose responsibility it is as politicians/public office holders in the State, have not been faithful as they should in constructing and maintaining vital road networks across the State. This attitude of a government, is more evident in the current Governor Ifeanyi Okowa led administration. They do not construct or maintain street roads that are not in areas where politicians, top government officials and top PDP officials live in.
We believe the construction and maintenance of road networks should not be politicized. All parts of Delta State, irrespective of tribes, need good motorable roads. Okowa is the Governor of Delta State and not a Governor of only PDP members. He is the Chief Executive Officer of Delta State and the responsibility to cater for all the needs of all in the State, is his statutory official duties. He contested as Governor to govern the State, hence it is his sole responsibility to live up to that expectation by catering for the social and security needs of Deltans and people living in the State.
With the above unfortunate prevailing circumstance in Delta State, there is no way we can aspire to develop or see the needed change if the appropriate steps are not taken and adjustments made. However, the Delta State Government should understand that most developed societies in the world jump-started their economies by accelerating their infrastructural development and building on it; examples being those of India, China, the United States of America, etc. The crux of this matter is that a State cannot be rich without good infrastructure and security assurance. All the great civilizations attained greatness only through the entrenchment of adequate and sustainable infrastructure and guaranteed security.
Governor Okowa should realize that he is the one in the Driver’s Seat and as such, the One-In-Charge of the State’s movement ahead in any direction. Whatever good or bad prevailing situations around the State will be attributed to him. It is Governor Okowa (not me), that will be the one who takes the glory and praise if he is able to transform the economic fortunes of the State and the living standard of the people. Same also, if he is not able to do this. But we believe he can transform Delta State if he really wants to. Those who transformed their societies do not have two heads. They are human beings and political leaders like the ones in Delta State presently. The likes of Peter Obi of Anambra State, Ahmed Tinubu and Babatunde Fashola of Lagos State, though, have left office, but the good legacies they left behind in the States still speaks well of them. Ambode, who is currently on the driver’s seat in Lagos State, is doing a great job and he is being applauded for it. It is the same we have the likes of Al-Maktoum of Dubai, Mao Zedong (chairman Mao) of China, etc., have transformed their societies with amiable legacies. Governor Okowa can do same in Delta State. So, let all the sycophancy and praising/commending the government for doing little or nothing – stop. Such praises will not help the State. Governor Okowa needs to deliver practically and not just showing off via media publicity stunts. Deltans need to see results and less talking and talking.
No magic or economic expert that can develop Delta State in the absence of basic infrastructure and guaranteed security. The provisions of these essential two factors, are not only part of what constitutes as development, but also the foundation upon which all other efforts towards development are made. Infrastructure and guaranteed security are a necessity for development to thrive.
Zik Gbemre, JP.