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Nigerian Space Research and Development Agency
Nigerian Space Research and Development Agency

The document discusses the challenges of developing a space enterprise program in Nigeria. It notes that while space programs can provide economic and social benefits, developing countries struggle to embark on such programs due to lack of capital and convincing investors. Nigeria has shown interest in space programs and established NASRDA to develop space technology, but attracting private funding remains difficult given the long timelines between investment and returns. Government funding has supported some successes like NigeriaSat-1, but fully realizing Nigeria's space ambitions will require overcoming challenges around capitalization and gaining public support.

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The Challenges of Space Enterprise in Nigeria. Edward Omowa Introduction A space development proponent typically uses the spin-of benefits derivable from space science and technology projects as basis for investment. In the case of Nigeria, this is followed with promises that the outcome will open new frontiers to poverty alleviation, eradication of social services. While these reasons are arguable, space enterprise is meeting these objectives in developed countries. If the economic and social benefits are this attractive, why are developing countries finding it difficult to embark on the enterprise? The assertion being made by space development advocates is that the basic understanding required already exists or can be developed from available science and technology. True as this may be, the political and economic well-being of the state involved need to be taken into consideration. Basically, we depend on people other than our relations to satisfy our wants. The responsibility for the system of want satisfaction revolves around a political authority whose will
goes a long way in determining this satisfaction. In other words, there is the need to advice the statesman on how s/he could best manage the economic affaires of the state so that the wants of the citizenry particularly their basic needs could be met. The rudimentary understanding of the above is necessary before realistically planning for a space project in a developing economy. This theoretical analysis is a common basis for developmental theory. Literatures reveal that only a few considerations have been given to the political economics of space development projects. Rather, most space entrepreneurs have chosen to describe the exciting science and engineering possibilities with the attendant spin-of benefits. It is very crucial for a developing country to embark on adequate education and orientation of its citizenry if any space project is to gain its attention, more so when the citizens are adjudged to be poor by international standards. Both elite and mass public opinion machineries need to be mobilized to generate the support necessary for such a project to be developed. However, much more conviction is required in order to gain support on appropriating funds to the
project when majority of the population is jobless and hungry. What needs explanation are the rationale motivating investors to risk their capitals in opening a very distant and completely uninhabited frontier that is subject to extreme environmental conditions. Why should an investor risk the enormous capital necessary to realize these dreams? Most often, space development businessmen typically respond to this question by itemizing the likely economic benefits derivable from space. After the initial capital investment has been put in place, there is the need to continually appropriate a percentage of public funds to the project funds to the project until fruition. it should be noted, however, that the technology and personnel for space projects are less in doubt than is the necessary capital investment. Capitalization: a major problem It is herculean a task persuading investors to risk enough funds in financing space development projects such as launching communication satellites. Investors and leaders seek to maximize economic returns from capital wile taking little or no risk at all; this is the reason for the proliferation of buying and selling in developing
countries¡¯ economies like Nigeria¡¯s. since capital cost is higher for high-risk investments, persuading investors and lenders to part with their capital requires making credible promises of better returns than they would have received on alternative investment with less or commensurate risk during the same period. Apart from the fact that space development with less or commensurate risk during the same period. Apart form the fact that space development business might not attract enough investors because of the large capital investment required, it is often confronted with the risk that the business might not make good returns as the technology might fail to work as projected. This is even worse with the lenders who are often skeptical of the business yielding good returns. In other words, the upfront capital investment necessary to proceed with space development projects tends to be relatively large and takes a relatively long period of time before generating cash flows or profits. No matter the assumption, attracting capital for projects using proven technologies (like rocketry and communication satellites launching) remains difficult. Even. The idea of borrowing from commercial banks is not attainable, hence the need for government participation in economic space development.
Nigeria¡¯s experience in the space industry Nigeria made is intention of going into the space industry known at the ECA/OAU inter-governmental meeting in Addis Ababa, Ethiopia in 1971. As a follow-up, it established the National Space Research and Development Agency (NASRDA) with the sole aim of establishing a ¡°fundamental policy for the development of space science and technology development in Nigeria¡± by approving he National Space Policy and Programme. The scope of the policy to be implemented by the agency is enumerated below: ? The study of basic sciences in order to lay the foundation for deriving maximum benefits from the nation¡¯s participation in the space enterprise. ? For the attainment of space capabilities, Nigeria¡¯s efforts should focus on research and rigorous education, engineering development, design and manufacture, particularly in the areas of instrumentation, rocketry and small satellites as well as in satellite data acquisition, processing, analysis and management of related software.
? The establishment of a national earth observation station for remote sensing and satellite meteorology data acquisition. Such an infrastructure will enhance the indigenous ability to adopt, modify and create new techniques for national resources inventories, monitoring, evaluation and management. ? The provision of efficient, reliable and adequate telecommunications services in Nigeria in order to enhance the growth of the industrial, commercial and administrative sectors of the economy. From the above, it is obvious that the Nigerian Government has shown interest in, and continued to develop space technology in its belief that its resources can be more effectively developed for the benefit of its citizenry by meeting the Millennium Development Goals (MDGs). It also saw the need to reduce poverty, hunger and diseases through improved agricultural production. Improved healthcare delivery, a more active mining sub-sector effective communication network, environmental protection, good governance and conflict resolution not only in Nigeria but also on
the African continent. It is, therefore, very important that the government participates in space development for such programmes to succeed and sustainably too. This is visible in the country¡¯s efforts in the successful launch of Nigeria sat-1 which have been providing data for resource mapping and environmental monitoring. With the satellite¡¯s participation in Disaster Monitoring Constellation (DMC) with other satellites belonging to Algeria, china, turkey and the UK it has provided an opportunity for knowledge sharing in Africa. Convinced that the NigComSat- 1 communication satellite would provide job opportunities for over 150,000 engineers and technicians through telecommunications services provides, and enhance the growth of innovation services in the areas of e-commerce, e-education, e-government and tele- medicine. It was put into orbit in May 2007, but was unfortunately lost towards the end of 2008. In spite of this setback, NigeriaSat-2 is billed for launch in late 2010. All the above have basically been through public funding, although insurance coverage is the major contribution from the private sector; private sector participation is still significantly low in Nigeria. The idea of capitalization from commercial banks or the chance of attracting enough funds form
the private sectors is still elusive, apparently because the period between the initial investment and the economic payoff is far longer than contemplated in an average business plan; this is considered unattractive on Nigeria ¡®s economic platform. It is the opinion of some technocrats that private enterprise and unfettered market are capable of overcoming almost any economic obstacle. It is on this premise that the administration of former president Olusegun Obasanjo believed in and pursued its space science and technology development agenda to the present level with adequate public funding. Of course many private sector concerns have directly or indirectly benefitted from the outcome. In addition to the factors suggested for Africa¡¯s space policy to be realistic, the issue of private participation in space enterprise funding or even borrow facilities from such government programmes, it will be totally out of place to classify business efforts here as ¡®private¡¯ or public. Rather it should be seen as an avenue to invest and get returns on investment with minimal risks, just like any business venture. Space enterprise should, therefore be seen and understood as massive public works project which requires huge funding in an
economic environment conducive enough for private firms to invest in and profit from. Conclusions The fundamental problem in opening any business frontier is the dearth of funds. There is no gainsaying the fact that the government is better at financing large projects, while encouraging private sector participation through the introduction of incentives and appropriate regulations geared towards attracting more investment. Effective conviction and lobbying should also be applied in engaging he citizenry in a participatory role. With the current global downturn in economy, this is the right time for developing countries, Nigeria inclusive, to look inwards and utilize space technology to optimally develop their hitherto untapped or abandoned economic resources. Nigeria has been running an economic system that is completely dependent on oil and gas, to detriment and complete neglect of agricultural and mineral sectors which had been the mainstay of its economy. This is the time to open up other promising sectors of the economy in order to survive the global slide.
Omowa
Reference 1. McLUCAS, j. l., 1991. Commerce. Harvard University Press, Cambridge. 2. Simonoff, J., 1997. Financing of space business. In: D. G. Dallmeyer and K. Tsipis, (Eds.) Heaven and Earht: Civilian Uses of near-Earth Space. The Hague Kluwer Law International, pp. 69-82. 3. Boroffice, R. A. and Akinyede, J. O. 2005. Space Technology and Development in Africa and Nigeria¡¯s experience. National Space Research and Development Agency, Abuja, Nigeria, 82p. 4. Central Bank of Nigeria. 2004. CBN Annual Report and Statement of Accounts for the Year ended 31st December, 2003. Central Bank of Nigeria April 2004, 182p. 5. Akinyede, J. O. 2004. NigeriaSat-1: A unique tool for sustainable socio-economic development in Africa. Paper presented at the 5th African Association of Remote Sensing of the Environment, Nairobi, Kenya, October 2004, 10p. 6. National Space Research and Development Agency. 2005. Nigerian Communication Satellite (NIGCOMSAT-1) project outline. A publication of the National Space Research and Development Agency, Nigeria, 24p. 7. Boroffice, R. A 2008. The Nigerian space programme: an update. African Skies, No. 12, October 2008, pp. 40-45. 8. Abiodun, A.A. 2008. Future trends in the global arens: Challenge and opportunities for Africa. African Skies, No. 12, October 2008, pp.12-22.

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  • 1. The Challenges of Space Enterprise in Nigeria. Edward Omowa Introduction A space development proponent typically uses the spin-of benefits derivable from space science and technology projects as basis for investment. In the case of Nigeria, this is followed with promises that the outcome will open new frontiers to poverty alleviation, eradication of social services. While these reasons are arguable, space enterprise is meeting these objectives in developed countries. If the economic and social benefits are this attractive, why are developing countries finding it difficult to embark on the enterprise? The assertion being made by space development advocates is that the basic understanding required already exists or can be developed from available science and technology. True as this may be, the political and economic well-being of the state involved need to be taken into consideration. Basically, we depend on people other than our relations to satisfy our wants. The responsibility for the system of want satisfaction revolves around a political authority whose will
  • 2. goes a long way in determining this satisfaction. In other words, there is the need to advice the statesman on how s/he could best manage the economic affaires of the state so that the wants of the citizenry particularly their basic needs could be met. The rudimentary understanding of the above is necessary before realistically planning for a space project in a developing economy. This theoretical analysis is a common basis for developmental theory. Literatures reveal that only a few considerations have been given to the political economics of space development projects. Rather, most space entrepreneurs have chosen to describe the exciting science and engineering possibilities with the attendant spin-of benefits. It is very crucial for a developing country to embark on adequate education and orientation of its citizenry if any space project is to gain its attention, more so when the citizens are adjudged to be poor by international standards. Both elite and mass public opinion machineries need to be mobilized to generate the support necessary for such a project to be developed. However, much more conviction is required in order to gain support on appropriating funds to the
  • 3. project when majority of the population is jobless and hungry. What needs explanation are the rationale motivating investors to risk their capitals in opening a very distant and completely uninhabited frontier that is subject to extreme environmental conditions. Why should an investor risk the enormous capital necessary to realize these dreams? Most often, space development businessmen typically respond to this question by itemizing the likely economic benefits derivable from space. After the initial capital investment has been put in place, there is the need to continually appropriate a percentage of public funds to the project funds to the project until fruition. it should be noted, however, that the technology and personnel for space projects are less in doubt than is the necessary capital investment. Capitalization: a major problem It is herculean a task persuading investors to risk enough funds in financing space development projects such as launching communication satellites. Investors and leaders seek to maximize economic returns from capital wile taking little or no risk at all; this is the reason for the proliferation of buying and selling in developing
  • 4. countries¡¯ economies like Nigeria¡¯s. since capital cost is higher for high-risk investments, persuading investors and lenders to part with their capital requires making credible promises of better returns than they would have received on alternative investment with less or commensurate risk during the same period. Apart from the fact that space development with less or commensurate risk during the same period. Apart form the fact that space development business might not attract enough investors because of the large capital investment required, it is often confronted with the risk that the business might not make good returns as the technology might fail to work as projected. This is even worse with the lenders who are often skeptical of the business yielding good returns. In other words, the upfront capital investment necessary to proceed with space development projects tends to be relatively large and takes a relatively long period of time before generating cash flows or profits. No matter the assumption, attracting capital for projects using proven technologies (like rocketry and communication satellites launching) remains difficult. Even. The idea of borrowing from commercial banks is not attainable, hence the need for government participation in economic space development.
  • 5. Nigeria¡¯s experience in the space industry Nigeria made is intention of going into the space industry known at the ECA/OAU inter-governmental meeting in Addis Ababa, Ethiopia in 1971. As a follow-up, it established the National Space Research and Development Agency (NASRDA) with the sole aim of establishing a ¡°fundamental policy for the development of space science and technology development in Nigeria¡± by approving he National Space Policy and Programme. The scope of the policy to be implemented by the agency is enumerated below: ? The study of basic sciences in order to lay the foundation for deriving maximum benefits from the nation¡¯s participation in the space enterprise. ? For the attainment of space capabilities, Nigeria¡¯s efforts should focus on research and rigorous education, engineering development, design and manufacture, particularly in the areas of instrumentation, rocketry and small satellites as well as in satellite data acquisition, processing, analysis and management of related software.
  • 6. ? The establishment of a national earth observation station for remote sensing and satellite meteorology data acquisition. Such an infrastructure will enhance the indigenous ability to adopt, modify and create new techniques for national resources inventories, monitoring, evaluation and management. ? The provision of efficient, reliable and adequate telecommunications services in Nigeria in order to enhance the growth of the industrial, commercial and administrative sectors of the economy. From the above, it is obvious that the Nigerian Government has shown interest in, and continued to develop space technology in its belief that its resources can be more effectively developed for the benefit of its citizenry by meeting the Millennium Development Goals (MDGs). It also saw the need to reduce poverty, hunger and diseases through improved agricultural production. Improved healthcare delivery, a more active mining sub-sector effective communication network, environmental protection, good governance and conflict resolution not only in Nigeria but also on
  • 7. the African continent. It is, therefore, very important that the government participates in space development for such programmes to succeed and sustainably too. This is visible in the country¡¯s efforts in the successful launch of Nigeria sat-1 which have been providing data for resource mapping and environmental monitoring. With the satellite¡¯s participation in Disaster Monitoring Constellation (DMC) with other satellites belonging to Algeria, china, turkey and the UK it has provided an opportunity for knowledge sharing in Africa. Convinced that the NigComSat- 1 communication satellite would provide job opportunities for over 150,000 engineers and technicians through telecommunications services provides, and enhance the growth of innovation services in the areas of e-commerce, e-education, e-government and tele- medicine. It was put into orbit in May 2007, but was unfortunately lost towards the end of 2008. In spite of this setback, NigeriaSat-2 is billed for launch in late 2010. All the above have basically been through public funding, although insurance coverage is the major contribution from the private sector; private sector participation is still significantly low in Nigeria. The idea of capitalization from commercial banks or the chance of attracting enough funds form
  • 8. the private sectors is still elusive, apparently because the period between the initial investment and the economic payoff is far longer than contemplated in an average business plan; this is considered unattractive on Nigeria ¡®s economic platform. It is the opinion of some technocrats that private enterprise and unfettered market are capable of overcoming almost any economic obstacle. It is on this premise that the administration of former president Olusegun Obasanjo believed in and pursued its space science and technology development agenda to the present level with adequate public funding. Of course many private sector concerns have directly or indirectly benefitted from the outcome. In addition to the factors suggested for Africa¡¯s space policy to be realistic, the issue of private participation in space enterprise funding or even borrow facilities from such government programmes, it will be totally out of place to classify business efforts here as ¡®private¡¯ or public. Rather it should be seen as an avenue to invest and get returns on investment with minimal risks, just like any business venture. Space enterprise should, therefore be seen and understood as massive public works project which requires huge funding in an
  • 9. economic environment conducive enough for private firms to invest in and profit from. Conclusions The fundamental problem in opening any business frontier is the dearth of funds. There is no gainsaying the fact that the government is better at financing large projects, while encouraging private sector participation through the introduction of incentives and appropriate regulations geared towards attracting more investment. Effective conviction and lobbying should also be applied in engaging he citizenry in a participatory role. With the current global downturn in economy, this is the right time for developing countries, Nigeria inclusive, to look inwards and utilize space technology to optimally develop their hitherto untapped or abandoned economic resources. Nigeria has been running an economic system that is completely dependent on oil and gas, to detriment and complete neglect of agricultural and mineral sectors which had been the mainstay of its economy. This is the time to open up other promising sectors of the economy in order to survive the global slide.
  • 11. Reference 1. McLUCAS, j. l., 1991. Commerce. Harvard University Press, Cambridge. 2. Simonoff, J., 1997. Financing of space business. In: D. G. Dallmeyer and K. Tsipis, (Eds.) Heaven and Earht: Civilian Uses of near-Earth Space. The Hague Kluwer Law International, pp. 69-82. 3. Boroffice, R. A. and Akinyede, J. O. 2005. Space Technology and Development in Africa and Nigeria¡¯s experience. National Space Research and Development Agency, Abuja, Nigeria, 82p. 4. Central Bank of Nigeria. 2004. CBN Annual Report and Statement of Accounts for the Year ended 31st December, 2003. Central Bank of Nigeria April 2004, 182p. 5. Akinyede, J. O. 2004. NigeriaSat-1: A unique tool for sustainable socio-economic development in Africa. Paper presented at the 5th African Association of Remote Sensing of the Environment, Nairobi, Kenya, October 2004, 10p. 6. National Space Research and Development Agency. 2005. Nigerian Communication Satellite (NIGCOMSAT-1) project outline. A publication of the National Space Research and Development Agency, Nigeria, 24p. 7. Boroffice, R. A 2008. The Nigerian space programme: an update. African Skies, No. 12, October 2008, pp. 40-45. 8. Abiodun, A.A. 2008. Future trends in the global arens: Challenge and opportunities for Africa. African Skies, No. 12, October 2008, pp.12-22.