Executive Order No 5.pptx

EXECUTIVE ORDER NO 5: VERITABLE VEHICLE FOR
DISMANTLING FOREIGN DOMINATION AND
BOOSTING INDIGENOUS CAPACITY IN ENGINEERING
AND TECHNOLOGY
By
Engr. Kamil Olalekan, FNSE.

1.0 INTRODUCTION
Over the years, the foreign domination of the science and technology sector in Nigeria has
been a thorny issue in the polity. The development has stymied the growth of professionals
in the multi-sectoral fields of science, technology and engineering.
Certainly the Nigerian professionals are not bereft of the skills, expertise and competence
to perform far better than their foreign counterparts but the seeming preference for
expatriates has not only been counterproductive, it has also led to massive capital flights.
This is one trend that professionals in the engineering and technology practices have been
exploring avenues to change in order to broaden opportunities for young practitioners and
at the same improve the social and economic problems of the country.

1.0 INTRODUCTION CONT’D
The engineering profession is not immune from this challenge from years immemorial.
We have seen jobs meant for indigenous engineers being given to foreigners.
But we seem to be seeing some relief with the Executive Order 5 issued by President
Muhammadu Buhari in 2018 which has the potential to further strengthen the existing
Local Content Act aimed at giving priority to indigenous professionals in the science
and engineering procurement and practices.

2.0 EXAMINING EXECUTIVE ORDER 5
In what could be described as a bold move towards enhancing the socioeconomic standing of
engineers and professionals in the science, engineering and technological disciplines, the President and
Commander-in-Chief of the Armed Forces, Federal Republic of Nigeria issued the Executive Order Five
(05) on Friday February 2, 2018.
In a proclamation entitled “Presidential Executive Order for Planning and Execution of Projects,
Promotion of Nigerian Content in Contracts and Science, Engineering and Technology,” President
Buhari, pursuant to the authority vested in him by the Constitution, signed the order making it
mandatory for all Ministries, Departments and Agencies (“MDAs”) of government to engage indigenous
professionals in the planning, design and execution of national security projects and maximize in-
country capacity in all contracts and transactions with science, engineering and technology
components.

2.0 EXAMINING EXECUTIVE ORDER 5 CONT’D
The Executive Order which took effect immediately is an all-encompassing proclamation
affecting not just our profession but other science and technology related disciplines.
This is no doubt a boost to the existing Local Content Act of 2010 which was signed into law
by the immediate past President, Dr. Goodluck Ebele Jonathan.
The EO5 made specific directives which align with the aims and objectives of the order.
The directives are as follow as itemized in a state house document accessed via
https://statehouse.gov.ng/wp-content/uploads/2018/02/PRESIDENTIAL-EXECUTIVE-ORDER-
5.compressed.pdf:

• All procuring authorities shall give preference to Nigerian companies and firms in
the award of contracts, in line with the Public Procurement Act, 2007;
• Where expertise is lacking, procuring entities shall give preference to foreign
companies and firms with demonstrable and verifiable plan for indigenous capacity
development, prior to the award of such contracts;
• MDAs shall engage indigenous professionals in the planning, design and execution
of national security projects and consideration shall only be given to a foreign
professional, where it is certified by the appropriate authority that such expertise is
not available in Nigeria;

• Nigerian companies or firms duly registered in accordance with the laws of Nigeria, with
current practising licence shall be lead in any consultancy services involving Joint Venture
(JV) relationships and agreements, relating to Law, Engineering, ICT, Architecture,
Procurement, Quantity Surveying, and etc.;
• MDAs shall ensure that before the award of any contract, Nigerian counterpart staff are
engaged from the conception stage to the end of the project and shall also adopt local
technology that meet set standards to replace foreign ones;
• The Ministry of Interior shall desist from giving visas to foreign workers whose skills are
readily available in Nigeria;

• The Federal Government shall introduce Margin of Preference (“MoP”) in National Competitive Bidding, in the
evaluation of tenders, from indigenous suppliers of goods manufactured locally over foreign goods (MoP shall
be 15% for both international competitive bidding for Goods and domestic contractors for national competitive
bidding for Goods. For Works for domestic contractors, the MoP shall be 7.5%);
• Foreign companies or firms shall not be engaged in contracts for Works, Goods, and Services in the country in
violation of the standard international best practices as provided for under relevant statutes such as the
Companies and Allied Matters Act (CAMA), Council for Regulation of Engineering (COREN) Act, Chartered
Institute of Purchasing and Supply Management Act, Public Procurement Act, and the National Information
Technology Development Agency (NITDA) Act as well as other relevant Nigerian laws and regulations on
acquisition of technology and conduct of public procurement;

• MDAs shall ensure that any professional practising in Nigeria must be duly registered
with the appropriate regulatory body in Nigeria.
• The Head of Service of the Federation shall ensure that foreign professional certificates
are domesticated with the relevant professional bodies before being considered for any
contract award or employment in Nigeria;
• Agreements involving any Joint Venture and Public Private Partnership (PPP) between a
foreign firm and a Nigerian firm, for technology acquisition or otherwise, shall be
registered with the National Office for Technology Acquisition (“NOTAP”) in accordance
with the provisions of the NOTAP Act, before such contract are signed by the MDAs;

• A Nigerian company or firm shall not be disqualified from an award of contract by any MDA on
the basis of the year of incorporation except on the basis of qualification, competence and
experience of the management in the execution of similar contracts;
• NOTAP shall develop, maintain and regularly update a Data Base of Nigerians with expertise in
science, engineering, technology and other fields of expertise while the Ministry of Interior shall
take into consideration the NOTAP Data Base together with other similar data from the Nigerian
Academy of Engineering; Nigerian Content Development and Monitoring Board; Federal Ministry
of Science and Technology and other relevant Ministries; in determining the availability of local
skilled manpower in Science, Technology and Innovation (STI) for the grant of Expatriate Quota;

• Where qualifications and competence of Nigerians are either unavailable or unascertainable, the Ministry of
Interior shall ensure that Expatriate Quota for projects, contracts and programme are granted in line with the
provisions of the Immigration Act and other relevant laws, and may create special immigration classification to
encourage foreign expatriates (particularly from African countries) to reside and work in Nigeria for the purpose
of sharing knowledge with Nigerian professionals; and
• The Federal Inland Revenue Service (FIRS) and the Ministry of Finance shall ensure that tax incentives are granted
to existing machine tools companies (including foundry, machine shop, forge shop, and indigenous artisans) to
boost local production of their products while tax incentives may be granted to Small and Medium Enterprises
and foreign firms for the utilization of local raw materials that are authenticated by the Raw Materials Research
and Development Council (RMRDC).

A cursory look at the proclamation shows that the order is very all encompassing touching
all critical areas of procurement, job creation, empowerment of indigenous professionals,
boosting foreign direct investments (FDI) and encouraging big manufacturers and
multinationals all over the world to domesticate their activities.
But the question to ask is how effective have we implemented this order? What is the
compliance level among Ministries, Departments and Agencies of government? Is there a
monitoring mechanism in place to track non-compliance? These are just few of the posers
we need to interrogate in determining the effectiveness of this executive order.

Going through the various components of the EO5, you begin to ask how many of these directives
are being implemented by the MDAs which are saddled with the responsibility of giving effect to
this order.
We have seen instances where this order has been flagrantly violated by MDAs by giving jobs
meant for Nigerians to foreigners without significant input from Nigerians.
But by and large we are gradually seeing some relief with this order but we all have roles to play
in making it work.
To use the words of the Immediate Past President of the Nigeria Society of Engineers (NSE), Engr.
Adekunle Mokuolu, “Those who doubt the capacity of local engineers is like questioning the capacity of
a woman to get pregnant.”
We can begin to leverage on this order by positioning ourselves, proving our mettles to take advantage
of the massive opportunities it would crystallize.

3.0 DISMANTLING FOREIGN DOMINATION
Foreign domination in the nation’s science, technology and engineering sector is not a new
phenomenon. This is what we have been fighting for decades. There are several
multinationals operating in the country with little or no significant Nigerian content in their
employment but we are gradually seeing some change.
I recently saw in a newspaper where the Minister of Transportation, Mr. Rotimi Amaechi was
challenging the contractor handling the Lagos-Ibadan standard gauge railway to provide the
list of Nigerian engineers they have on site.
This is a way of impressing it on the contractor, the China Civil Engineering and Construction
Corporation (CCECC) to comply with the existing laws operating in the country on
incorporating significant local content in their operation.

3.0 DISMANTLING FOREIGN DOMINATION CONT’D
In line with the Nigerian Content Act and the implementation of the Executive Order, we have
seen the setting up of Wagon Assembly Plant by the CCECC in Ogun State in 2018.
This is one of the advantages of this Executive Order as it would encourage many Original
Equipment Manufacturers (OEMs) around the world to set up plants here in Nigeria and provide
jobs for indigenous engineers.
The 2010 Local Content Act and the oil and gas industry
Prior to the passage of the Nigerian Oil and Gas Industry Content Development Act, 2010
(NOGICDA), the all-important sector was largely dominated by expatriates with little or no
indigenous capacities utilized.

But the passage of the Act in 2010 has triggered the utilization and promotion of indigenous
capacities in Nigeria. The Act also mandated stakeholders in the oil and gas sector to
provide regular update and report on Nigerian Local Content as it affects their
establishments and business concerns. By this we are seeing some significant compliance in
the sector.
In August this year, the Nigeria Content Development and Monitoring Board (NCDMB)
unveiled a gas production plant in partnership with a manufacturing company. The 400,000
per annum Type 3 LPG composite cylinder manufacturing plant is sited in Polaku, Bayelsa
State.

Also, several partnership arrangements are ongoing with the Oil Producers Trade Section (OPTS), an
umbrella organization of local and foreign companies holding oil prospecting licenses and oil mining
licence to deepen capacity utilization of indigenous professionals.
It should be pointed out also that there is currently a move in the National Assembly to amend the
NOGICDA 2010 to, among others, extend the application of the local content principles and philosophy
to the following key sectors of the economy - Information and Communications Technology, Power,
Solid Minerals, and Construction.
So with this we would be encouraging in-country manufacturing and assembly of materials and inputs
like we are seeing with the Kajola Wagon Assembly Plant and several others that might come on stream
as a result of the Nigerian content initiative.

4.0 EXPERIENCE FROM OTHER CLIMES
While we have started well with the Nigerian content policy and the executive order five
which also seeks to promote local content, we need to also examine how it is done in other
countries especially in Africa to boost indigenous capacity in all sectors of their economies.
For instance in South Africa, the key elements of their local content bother on participation,
emphasizing majority ownership by citizens in terms of management, employees, while
there is emphasis on value addition with parts for manufacturing expected to be sourced
locally while in areas where there are few expatriates, technology transfer and transfer of
technical skills is strongly encouraged.

4.0 EXPERIENCE FROM OTHER CLIMES CONT’D
South Africa through its Industrial Policy Action Plan known as IPAP has identified local content “as a
strategic industrial policy instrument, which can be used to leverage the power of public procurement;
reduce the country’s trade deficit; address market failures; foster infant industries; and increase the
governments tax base,” according to a policy 7/2017 titled, “South Africa Local Content Policies: Challenges
and Lessons to Consider.
For instance the country has highlighted minimum threshold for local content in different sectors of the
country’s economy. We have several sectors with 100 per cent local content requirement like textile,
clothing and footwear, among others.
The story is not different in Botswana which has attained some successes in promoting indigenous capacity
in their extractive industry, manufacturing, among other sectors which has propelled their economy.

Across continents, countries have since realized the need to promote in-country
manufacturing through appropriate legislations.
In Egypt, the local content stipulation has been in place since the beginning of the
petroleum industry. This is the same in other sectors in the North African country. If you
check it out, the Mines and Quarry Law No 66 of 1953 is still very much in force.
Looking farther in the Asian countries, we should ask ourselves, how did the Asian Tigers
that we all know and always refer to achieve the breakthrough in technology and
engineering which has propelled them to dominate the world? They were able to do this by
promoting the ideals of “doing it yourself” with emphasis on building local capacity for the
different sectors of their economy.

Both India and China chose to believe in their local capacity and weathered the storm of rejection
of their products in the 90s but they are today some of the super powers of the world calling the
shots in manufacturing, engineering and technology.
Now this is the time we also need to insist on technology transfer taking advantage of the various
projects the Chinese are undertaking in Nigeria. We all know most, if not all our railway projects
are being carried out by the Chinese. This is the time to sit up and see how we can take over the
sector in 10 or 20 years to come.
Therefore, we need to be prepared for the expected benefits of the executive order 5 like I said at
the beginning of this presentation through training, retraining and updating our knowledge from
time to time.

I believe very strongly that this development has opened a vista of opportunities for us to improve and boost
our capacity and further prove wrong the doubting Thomas’s about the ability of a Nigerian engineer. For
those who say we don’t have the capacity, this is the time to prove them wrong.
We can only measure up to this by being up to date in our training and retraining, take advantage of the
advancement in Information and Communication Technology (ICT) to learn new trends in global engineering
practices.
The importance of continuing professional development to our profession cannot be over-emphasized. This is
where we are exposed to latest global trends and practices in engineering. Continuous learning and
professional development will prepare us for any challenge that might come our way as we take advantage of
the widening opportunities inherent in this executive order.

5.0 CONCLUSIONS
As I conclude this lecture, I must commend the administration of President Muhammadu Buhari for the
bold step taking in giving effect to this Executive Order N0 5. I also wish to put it on record the
landmark achievement of present Civilian Administration of Alh AbdurRazaq AbdulRahman for passing
into law Kwara State Procurement Agency in September, 2020, which is a variant of the Federal
executive Order.
They are essentially laws to empower indigenous professionals to dominate business undertakings in
the Nigerian nation.
But I must say that it is one thing to have this Executive Order and PPA in place, it is another thing to
ensure its religious implementation. We have to seriously walk the talk and monitor the implementation
of this Order in Ministries, Departments and Agencies (MDAs) in Federal and State Governments.

5.0 CONCLUSIONS CONT’D
COREN via its recently amended Act CAP 2004 as Amended (2018) has been properly equipped to deal
with infractions here and there in the implementation of this Executive Order. and Provisions of Public
Procurement Agencies in some states of the Federation. The Policy ensures transparency in contract
award and general empowerment scheme for citizenry.
Domestication of Executive order No 5 in the Federating States of Nigeria is imperative. It behoves on
us, engineering Practitioner to thoroughly study the provisions of the Executive Order and point out
infractions in award of contracts across the country especially those with engineering businesses. This is
the challenge that confronts us as we go along in this new journey.

RECOMMENDATIONS
1. The Federal Government and State Governments should set up a monitoring mechanism to ensure strict
compliance with this directive by the MDAs to achieve the objective of empowering indigenous engineers,
boosting Nigerian content in contract procurement, design and execution and at the same time improve
the socioeconomic development of the country.
2. The leadership of the NSE, NATE, NISET, NAEC under the umbrella of COREN should work closely with
relevant authorities of government to ensure effective implementation of the Executive Order No 5 and
Compliance with PPA Guidelines in all Empowerment Programmes be it in Contract Award in Consultancy
Services, Contracting, Procurement and where such order is being flouted, they should not hesitate to
make formal complaints to COREN, if possible leverage on MOU with ICPC to rein in erring members and
ensure that any government official or head of any MDA found wanting is appropriately sanctioned. This
would serve as deterrent to others who might want to frustrate the good intention of government by their
acts of commission.

RECOMMENDATIONS CONT’D
3. Cooperation with Standard Organisation of Nigeria should be explored to ensure quality of
Engineering materials and Testing of Procedures to International Standards to promote reliability
and enduring services
4. COREN through its cadres must ensure compliance with checklist for eligibility for Contract
Award under the category of Engineering Consulting Firm, Engineering Contracting firm,
Manufacturing or Procurement entity and Engineering Personnel or Practitioner with current
Practicing Licence. Otherwise, those entities are regarded as quacks and cannot undertake
engineering practice in Nigeria.
5. Expatriates must mandatorily have valid visa from Ministry of Interior in addition to possessing
COREN registration at appropriate cadre before they are allowed to partake in engineering
practice in Nigeria.

6. I want to submit that strict implementation of this order is critical to deepening the capacity of
indigenous engineers and controlling to a large extent if not totally demystifying foreign
dominance in engineering. This is no doubt a great development in this time of widening
infrastructural deficit which requires the services of the engineers to reset the trajectory.
7. All cadres (Engineers, Technologist, Technicians and Craftsmen) with their respective regulatory
bodies (NSE, NISET, NATE, NAEC etc.) all have to come together under the umbrella of COREN,
with a view to playing their respective roles towards the growth of indigenous professionals
quest for relevance in the Engineering and Technology development of our Nation.

8. Salient Provisions in Ammended COREN Act 2018 that reclaimed Engineering for the Engineering
Practitioners:
 Clause 4: All Engineering Works and Services shall have Consultant appointed for both
Design and Supervision.
 Clause 5: Major Engineering Contracts in the Public Sector shall provide explicitly for a
Training component that will ensure full and active participation of trainee by Engineers
and Engineering Technologists in the SIWES and SITSIE.
 Clause 6: The Design of the Major Engineering Contracts facilities shall be carried out in
Nigeria.

 Clause 7 Award of Contract and Value:
7a) All Engineering works and services up to N2.5b shall be exclusively reserved for indigenous
Engineering Firms), Provided always that the 2.5B benchmark shall be subject to review on regular
basis.
7b) where in the opinion of the Owner, the expertise required is beyond the engineering capability
of the Nigerian firm, a foreign firm shall be required to partner with a Nigerian firm acceptable to
the Owner in the execution of the Project”.
 Clause 8: All major Engineering contracts shall have a training component for the training
of Engineering Personnel.

 Clause 9: All the drawings for the works shall be duly cross checked and endorsed by a
duly registered Engineer with current Practicing Licence.
 Clause 10
• A copy of the stamped drawings shall be kept on site for inspection purposes.
• Regulatory bodies should ensure that all professionals are duly registered and adhere
to stipulated codes of conduct and regulations.
• The government via the MDAs must encourage, support and assist in capacity

Executive Order No 5.pptx

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