Mr. Zheng You is the Chairman of the Tongyi Group of Companies, a Chinese conglomerate with presence in Europe, Africa and Asia. In this interview with FRANCIS KADIRI, the Tongyi boss says that despite Nigeria’s economic challenges, the country remains a global destination for investment. Excerpts:
To what extent is Nigeria conducive for foreign investment, in your assessment?
The greatest problem of the Nigerian business environment is bribery and tips. Even when foreigners want to invest in Nigeria, the authorities want to be tipped before they process their papers or grant permits. That was not the case in China, because every government department knows the importance of welcoming foreign businesses to China. The problem of corruption and bribery in Nigeria has been experienced not only by Tongiy, but by virtually all other foreign investors, who need one permit or the other from the Nigerian authorities. This is a very big challenge, and it is discouraging investors. However, the problem is getting solved now.
How is the Tongyi Group coping with Nigeria’s unstable economy?
The business climate in Nigeria is very tough, but we have remained in business. Foreign trade has been the cardinal objective of a number of Chinese governments, so Chinese oriented companies are everywhere in the world. We are very conscious of quality service delivery. So we develop tailormade strategies needed to respond to challenges confronting us in any nation we find ourselves. Because we do so, we are able to stay-on and carry out our businesses in peace.
A lot of Chinese companies have been accused of not impacting on their host communities in Nigeria. What Corporate Social Responsibility has the Tongyi Group executed in its host communities?
Tongyi has a way of giving back to every community that hosts its business. We have come to Nigeria, not only to make profit by developing roads, bridges and mining; we would also make a mark in the lives of the people through CSR.
We have done so much under CSR. In Wase, Plateau State, Tongyi awarded scholarships to students of Gimbi community; Tongyi constructed six different concrete bridges on the road from Wase to Gimbi village, over rivers and streams; we constructed blocks of classrooms in Gimbi community; we also donated three tonnes of fertilizers and 750 kilogramme of seeds to farmers in Wase.
As part of our CSR, Tongyi trains local farmers on modern farming methods that will guarantee best yields. We didn’t just build big bridges and boreholes; we also maintain them periodically to keep them functional. But let me tell you this: of all that we have done in CSR, what we are most proud of is that we have been able to restore peace to the rural areas where we work.
How do you mean by ‘we have been able to restore peace’?
Before we established our businesses in the rural communities, the youth were restive, because they needed money, but there were no employments, and no means to make money, so they resorted to crime and violence. But when Tongyi got there, we employed the youth; we got them busy with work, and paid them appropriately. So they became serious and were ready to earn and they stopped being violent. Crime rate has also reduced in the local communities where we operate. This is verifiable and we are very proud of developing Nigeria.
What is your perception of the Nigerian business climate?
Nigeria is still a developing market; it is still an emerging market with attractive business prospects. Let me make a comparison: 30 or 40 years ago, China was like Nigeria. The difference was that the Chinese government did not only open its borders to trade, but it also supported Chinese businesses being established abroad. That policy is paying off today.
In your view, how could Nigeria become another China in some years?
China is a good example of how Nigeria can turn around its economy in a safe and sustainable way. Europeans, Americans, Canadians, and other nations invested in China when China opened its economy to foreign investment. China made it easy for business immigrants to enter China. There was patriotism. The immigration laws encouraged entry. Visa applications were processed quickly. You didn’t have to pay to enter China for investment. China was and is more investor-friendly.
It is believed that the Chinese pays too little to local labourers. What are your remunerations like?
Tongyi pays well; no labourer earns less than N40,000 monthly. Graduates earn N100,000 and above, monthly.
What technology transfer have you brought to Nigeria?
Technology transfer is prioritised in our policy. It is cheaper for the company to train local people than to import experts from overseas. It also makes it easy for us to adhere to the rules of expatriate quota governing foreign investments in Nigeria. Expatriate quota is the maximum number of foreigners a foreign company is permitted by law to bring into Nigeria. It is wrong to exceed the quota.
As we speak, only one Chinese heads respective departments. All their deputies are trained Nigerians. It is cheaper and safer for the company, because the cost of accommodation, travel fares when they have to return to China, or go on leave to China, to visit their families and the allowances due to foreigners are too high, compared to the remuneration of a trained local personnel. Also, we are able to easily obey expatriate quota by employing Nigerians.
When foreigners want to invest in Nigeria, the authorities want to be tipped before they process their papers or grant permits. That is not the case in China, because every government department knows the importance of welcoming foreign businesses to China
International businesses hate the technology transfer policy, because it renders expatriates needless. What is your take on this?
For Tongyi, technology transfer has brought us a lot of economic advantages. We save more money when we employ the locals and once they are able to do the job as well as the expatriates, we replace them and they go back to their countries.
The advantage is that we spend so much less. We only have to pay salaries of the local staff. No more payment of flight tickets for visits to families abroad. Securing housing and accommodation for expatriates in a country like Nigeria is very expensive. In Abuja, it has to be in the town. If we have to pay for accommodation for 100 expatriates, it is a lot of money, compared to salaries paid to locals, because we are not really responsible for travels to visit their families and flight tickets among others. So, I would say technology transfer is a win-win situation for Nigeria and Tongyi.
