EVOLVING STRATEGIES FOR SUSTAINABLE FINANCING OF

R&D ACTIVITIES THROUGH THE PUBLIC-PRIVATE

PARTNERSHIP ARRANGEMENT IN A DEVELOPING COUNTRY
LIKE NIGERIA

PRESENTATION BY

Ms EVELYN N. OPUTU
MANAGING DIRECTOR
BANK OF INDUSTRY (BOI) LIMITED

AT THE
THE 2010 SCIENCE AND TECHNOLOGY SUMMIT
HOLDING ON AUGUST 9-10,2010 1
 INTRODUCTION

Nigeria: Positioning For a New Decade -2020:

Nigeria’s strategic goals for the period will include

inter alia:

To become an important link in the global production
chain in technology, innovation, manufacturing and
modern economy

To expand trade and investment to achieve faster growth,

create jobs, improve productivity of the work force and
reduce poverty

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INTRODUCTION

In addition, as Nigeria expands its developmental space, five

fundamental shifts currently taking place in the economy will accelerate:

Primary products to manufactures with more elastic demand and

firmer prices

Oil to non oil exports (processed agric products, solid minerals,

crafts and manufactures)

Import substitution to export oriented industrial base

Public sector driven to private sector led market-oriented

economy

Managing the side effects of 20th Century economic progress

especially its impact on human welfare and the balance between
the possibilities for future generations and the economic
continuity of the current generation
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 INTRODUCTION

Along side these developments, the following trends will

create risks and opportunities in the new decade:

the critical role of energy in every aspect of our lives

The innovation economy – innovations that will transform the global
economy

The manufacturing sector using more of local R&D results

Globalization - will dictate how competition will be in all aspects of the
Nigerian economy

Exploiting and promoting strategies that would accelerate the
commercialization of R&D results in Nigeria

All these will shape the future of industry, improve value
addition to industrial goods and services, improve the
linkages between R&D activities and the private sector,
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Nigeria’s future.
STRATEGIES

As a nation with huge oil wealth, we need to take advantage

of the opportunities that the new decade presents:
i. we need to use our oil revenues to support and build modern
technologies and innovations
ii. we need to work towards building massive industrial sector to
actualize the nation’s huge potentials
iii. For this to happen, we need to sincerely and genuinely have a
strong private-public partnerships in the development of the
nation’s infrastructures, agri-business, agro-industries, etc.
iv. The overarching objective of the work of R&D activities is to
bring about economic growth-the capacity to diversify
domestic production structure through generating new
activities, strengthening economic linkages within the country
and creating domestic technological capabilities
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 STRATEGIES

Second step in evolving strategies for sustainable

financing of R&D activities through Public-Private
Partnership in the country is the establishment of
appropriate financing modalities to support the
implementation and use of R&D results in the
country.

Third step is to continue to fund and strengthen
capacities to build up skills and develop technologies
that improve efficiency and productivity along current
R&D results based on local demands and needs.

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STRATEGIES

Fourth factor in evolving strategies for sustainable financing

of R&D in Nigeria is on strengthening the capacities of
linkages among public-private agencies responsible for
R&D, financial sector and entrepreneurs in the
manufacturing sectors.

Fifth, financing entrepreneurs that are involved in R&D
activities who are innovative. Typically, innovation results
from a conscious purposeful search for opportunities. They
need to look for simple, focused solutions to real problems.

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BOI Financing Experience

The Bank’s lending structure has been positively favourable towards MSMEs and
large enterprises, but with backward integration effect on MSMEs.
• Based on the above:

The Bank supports the formation of clusters and out-growers schemes in the
agriculture and agro-allied ventures and other sectors of the economy.

The Bank organizes capacity building in collaboration with the Domestic and
Foreign Development partners.

MSME Development Funds in the following states: Anambra, Kwara, Delta ,
Niger, Kogi, Osun, Edo and Ekiti States ,while others are in pipeline.

The Bank has organized Boot Camp workshops on entrepreneurial development
in Gombe, Bauchi, Benue, Niger, Osun, Ondo, Ekiti, Anambra, Cross River, Delta
, Abuja, Plateau States, etc. About 90% of the cooperatives we have funded are
products of these workshops and also in partnership with US embassy in
promoting the African Growth And opportunity Act (AGOA) activities with a
Resource Centre recently opened in BOI, Lagos Office.
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BOI Financing Experience

BOI PRODUCTS AND SERVICES

Provision of direct loans, etc.

Financial advisory services to entrepreneurs.

Equity participation or investment funds.

Financing public infrastructure projects.

Acting as intermediary between entrepreneurs and financial
institutions.

The Bank has a Gender Desk handling various loan schemes
exclusively for women enterprises in conjunction with the
Federal Ministry of Women Affairs amongst others.

The Bank’s subsidiaries provide Leasing Services, Trustees
and Investment Services, Insurance Services, Business
Consultancy Services, Micro Finance Banking Services,
Bureau De Change, etc. 9
 BOI Financing Experience

BOI PRODUCTS AND SERVICES

BOI has been appointed to manage development initiatives at
state and national levels:

The Federal Government’s N100 billion Cotton Textile and
Garment Development Scheme with funds being raised by the
Debt Management Office.

The Federal Government’s Rice Intervention Fund of N10.0
billion.

Agro Sector initiative of the Bankers Committee that entails
collaborating with commercial banks and various State
Governments.

The management of the National Automotive Council (NAC)
fund. 10
 BOI Financing Experience

PRODUCTS AND SERVICES

The Business Development Fund for Women (BUDFOW) on
behalf of the Federal Ministry of Women Affairs and Social
Development (FMWASD)- that provides soft loans to women
entrepreneurs.

The Central Bank of Nigeria’s N500 billion Facility for the
development of power and industrial projects out of which
arrangement for disbursement of N200 billion for the refinancing/
restructuring of bank’s loans by BOI is now taking place. The Bank
has so far received 377 applications and 84% out of the total
applications (totaling N130 billion ) have been approved for
disbursement.

And the guidelines for the balance of N 300 billion earmarked for
the Power Sector and Aviation will soon be released by CBN.
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 Concluding Remarks

Evolving Strategies for sustainable financing of

R&D activities presupposes we want to influence
their current financing methods for better results in
future. To do that we need:

A clearly articulated future vision and a sense of the
trends of the day that will enable the future to become
reality.

A sound set of strategies to get there as already
mentioned in this paper.

Tools to persuade key stakeholders - NASENI, Energy
Commission of Nigeria(ECN),Banks, Nigerian Academy
of Sciences, etc. To be part of the expected changes. 12
Concluding Remarks

Thank You For Your Attention

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