Set-Top Boxes: ‘FG must ban importation to encourage local production’
Sir Godfrey Ohuabunwa is the Managing Director/CEO, Gospel Digital Technology, Calabar, Free Trade Zone, which is among the 13 Set-Top Boxes manufacturers licensed by the National Broadcasting Commission (NBC) for the Digital Switch Over plan by the Federal Government. In this interview, he speaks on local capacity and challenges the industry is facing.
What is between and the initiative government? the relationship your company digital switchover of the federal
The company was founded in 2014 and since then we have gone ahead to build what has made us the largest Set-Top Box manufacturing company in West Africa today. We have the assembly plants which have the capacity of a minimum of 2.4 million Set-Top Boxes per annum. On the second part of it, which is the manufacturing plant, we have placed order for equipment which will be arriving next month. It is the surface mount technology manufacturing line that will produce the chips and PCBs (personal computer boards).
What we intend to achieve from that factory include Set-Top Boxes and electric meters and when we are in full circle, the plant will be producing PCBs for cellphones, laptops and tablets. We will also be assembling television sets.
We further estimate that this company should be able to provide direct jobs to about 500 engineers. As at today, through the loan we have gotten from the Bank of Industry and other partners of ours, the plants have gulped about N1.6 billion already.
One of the things we are looking at to build up this plant is the market, because there is no need building a plant which will not function because of lack of market. On that ground, we are hoping that for the digital switch over programme, Nigeria is looking at about 60 million Set-Top Boxes to be manufactured from our plant and other plants.
You know, as at today, there is so much capital flight in the purchase of cellphones, tablets etc. We are hoping that the industry will be an avenue through which the capital flight will be localised, brought back to the country and create more jobs for Nigerians.
Therefore the support for government policies is also in place to stop the importation of Set-Top Boxes into Nigeria. This means that companies like Multi-Choice, Star Times will have to stop importing Set-Top Boxes into the country. Because it doesn't make sense when we are manufacturing it locally with same standard.
Also, we believe that the PCBs which will be manufactured in our plant will help not just our industry. As you are aware, today there are some electronic companies such as LG, Samsung amongst others which import television sets into Nigeria. So we are hoping that through this factory, instead of them importing, most of us can assemble those TV sets for them.
Other benefits in our business, are the AA battery used in the remote controls; even solar panels are things the industry will be fixed up for. As at today, we are the only one with facility of this magnitude and in full operation.
One of the questions being asked by people is if the Set-Top Boxes are available, when it will be available and if people have started working with them. We intend, by the tour, to tell Nigerians that the company exists, people are working and SetTop Boxes are being produced.
In view of the high demand in the country, what quantity can you produce to meet the demand?
Of the four lines we have, only two are working for now. With the two other lines, in one month, we will finish the whole order which we have. We have the capacity to increase our production. We are running one shift, and we can produce about 2.4 million; multiply it by three, it will give us close to 6.6 million boxes. A year already gives 2.4 with one shift. We have the capacity in full swing to provide 8 10 million boxes.
How do you tackle the issue of forex as almost all your raw materials are sourced abroad?
The biggest challenge we are facing is the issue of foreign exchange. We are pleading that for this DSO to be successful, government must give us a special window. What we buy more are the chips; they are not manufactured in Nigeria. We buy chips in large quantities and some other electronic components. Foreign exchange is a critical problem and challenge to us.
If Nigeria must meet that target, the federal government must give a special window to all the timelines. We cannot be treated like all others. We are producing because by June this year, Nigeria will switch on. They should give priority to all manufacturers because it has a timeline.
The other issue is that of power. Most times, we run on generator. Another issue is subsidy. By the white paper from the federal government, 10 million boxes are supposed to be subsidised by the government but it is only 1.2 million for now, so there is a gap right now. This is due to the poverty rate in Nigeria. The box is for the very poor and this has to be done. Level of awareness is also low and the federal government needs to provide funding to NBC to enable it carry out sensitization and enlightenment programmes around the nation.
Is the June deadline realistic?
It is possible. It is all about the government’s commitment. The minister, so far, is working hard. We need their encouragement.
Sir, can you put a figure on the capital flight affecting this sector because it will go a long way in sensitizing the people on the need for local companies like yours to be given a chance?
The Set-Top Box, for instance, the total amount needed by an estimate was about 30 million. Now, if you take 30 million of the boxes to be produced and manufactured overseas, not here in Nigeria, what Nigeria will be losing would be about 870 million dollars annually and it could be higher. So the government should ban the importation of Set-Top Boxes since we are now manufacturing.
Do you have a technical partner?
Our technical partner is Skyworld Digital Company from China which is the biggest in the world and some of their staff are working with us and transferring knowledge. They also produce for lots of other markets in the world such as Europe. The Standard Organisation of Nigeria (SON) has applauded their products and services.