Manufacturers raise alarm over looming job losses
The Basic Metal, Iron and Steel and Fabricated Metal
Products Sectoral Group of the Manufacturers Association of Nigeria (MAN), has
raised an alarm over possible massive retrenchment of the workers in the steel
sector, as non-patronage of local steel products spells doom for the industry.
With only about 35 or less of the steel plants still active, operations in the
firms have been at below capacity with utilisation less than
20 per cent and production less than 200,000 tonnes yearly.
The immediate past Chairman of the Group, Chief Oluyinka Kufile, at its yearly
general meeting, said construction activities in Nigeria in the last two years
lacked local content input in terms of steel and aluminium products,
as bulk of such items were being imported into the country.
He alleged that contractors involved in many of the infrastructural projects
refused to engage some of its members, which prevented local producers from
deriving proportionate benefits from governments and private expenditures, thus
resulting in poor capacity utilisation as well as low demand for
steel and aluminium products.
He said as manufacturers and investors in the industry, the sector may have no
choice if the situation persists, but to consider the option of closure to save
their investments from further losses.
Such decisions, he said, have consequences for the retrenchment of workers.“We
are hoping that government will quickly address these issues, otherwise,
unemployment along with poverty will worsen as the level of hunger, social and
economic deprivation and insecurity could be the order of the day,” he said.
Meanwhile, a Director, Federal Ministry of Mines and Steel, Ime Ekrikpo, said
plans are underway by the present administration to take up the per capita
consumption of steel products from below 10kg to about a 100kg by 2020.
“We know 2020 is in less than six months from now, but we are hoping that the
federal government could still meet the target with Ajaokuta and Delta steel
plants,” he said. Kufile said: “We are therefore of the opinion that the
manner and persistence of the current challenges of non-patronage and
importation of all manners of steel and aluminium products for
infrastructure projects and upgrade across the country, could consistently
spell doom for the industry.”
Going forward, he recommended the implementation of the executive
order 003 and 005 to be strictly monitored by the government, to ensure
that both public and private companies in the construction industry effectively
comply with local patronage and local content in all their projects where such
products and contents are locally available.
He said the way forward for the industry is the will and commitment of the
government and the industry players to make the sector a viable one, saying
that a bill has been sent to the National Assembly where all stakeholders were
enjoined to participate in the process.
The new Chairman of the group, who also doubles as the Group Managing Director,
KAM Group, Dr. Kamorudeen Yusuf, said he will continue to engage the federal
government to formulate favourable policies to revitalise the steel
industry.He said most of the steel companies closing down were due
to unfavourable policies, noting that government is yet to protect
local manufacturers from unfair competition to inferior steel products.
“Local manufacturers import their raw materials into the country at 15 per
cent duty rate, but the smugglers bring in their products at zero or
five per cent duty. This is killing the local manufacturers. The
government must block all the loopholes in the Customs that allow the smuggled
goods to enter the Nigerian market,” he added. The Guardian
