The current crisis facing the Western Metal Products Company has led to the closure of no fewer than 19 enamelware firms, while 250,000 jobs along the steel and enamelware value chain are also about to end, investigations by our correspondent have revealed.
WEMPCO is reportedly facing a huge debt burden of over N90bn, planning to sell its flagship five-star Oriental Hotel on the island and considering exiting Nigeria.
This may mean the end of its 700,000 tonnes-capacity steel plant.
Our correspondent gathered that the 40-year-old firm was the authorised sole distributor of cold-rolled iron sheet, used in the manufacturing of roofing sheets and annealed iron sheets used in the manufacturing of enamelware.
The Central Bank of Nigeria, in order to protect the local manufacturers, had included cold rolled iron sheet and annealed in the list of 41 banned items from access to official foreign exchange.
The implication is that all the firms that produce roofing sheets and enamelware in Nigeria may have to shut down in the event of WEMPCO’s exit.
Already, all the firms manufacturing wheelbarrows and shovels are said to have shut down while others are winding down gradually having run out of stock of raw materials.
It was gathered that WEMPCO’s trouble stemmed from the influx of substandard roofing sheets smuggled into Nigeria from Cameroon and other neighbouring countries.
The local firms were said to have been mandated by the Standards Organisation of Nigeria to keep the standard of roofing sheet at 0.015mm in thickness.
This posed competition challenge against smuggled roofing sheets which were 0.013mm and 0.014mm.
The smuggled versions were also said to be preferred by buyers because they were cheaper.
Low patronage set in for WEMPCO and its stock of unsold products went bad from staying too long in storage.
By last year, the company had closed down almost all its plants as they were no longer producing.
Punch correspondent also spoke to some of the buyers of WEMPCO products who recounted a different version of the story.
All of them, who spoke on condition of anonymity, said the firm was not consistent in filling orders.
It was alleged that they either took too long in delivering the product or delivered items different from the specification.
WEMPCO was also alleged to have abused the exclusive rights and waivers that were granted to it by the Federal Government.
It was learnt that whereas the previous government had granted the firm heavy waivers to aid it in production of cold-rolled sheet locally, the firm had instead embarked on heavy importation of the product.
Trouble started for it when the current administration came into power and decided to cancel the waivers.
It then became a Herculean task for WEMPCO to fill orders as the importation route had been closed and they could not produce to meet local demand.
Customers, who paid money into WEMPCO account, neither saw their money nor the goods they paid for. The bank held onto customers’ money because WEMPCO was heavily indebted to the bank, it was alleged.
According to The Punch, Robert Tung, the Managing Director of WEMPCO, declined the calls and did not respond to text messages sent to his line just as a consultant to the firm, Jide Mike, denied ever working for WEMPCO; or knew anything about the company.
Unity Bank Collaborate to Fund N15.5bn Equipment for Julius Berger
Unity Bank Plc, in company of other banks has facilitated a credit facility of N15.5bn for the acquisition of trucks and equipment to Julius Berger Plc.
The group Managing Director and Chief Executive Officer of SCOA Nigeria Plc, Dr Massad Boulos, has appreciated the gesture.
A statement from SCOA said that SCOA presented 33 MAN platform trucks and equipment to Julius Berger to be deployed for the construction of the 380 kilometre Abuja-Kaduna-Kano roads.
The banks that funded the acquisition were Unity Bank Plc, Heritage Bank Limited, Zenith Bank Plc, Providus Bank Limited, Wema Bank Plc, United Bank for Africa Plc, Union Bank Plc and Coronation Merchant Bank Limited.
Boulos said, “I commend Unity Bank, their MD and the members of the executive management; and the entire team of banks who have worked closely with us on this project.”
Mr Ralph Brendicke, the representative of the MD of Julius Berger Nigeria Plc, Dr Lars Richter, said the trucks and other equipment would help the company expand its field capacity and increase the speed of execution leading to timely completion of the highly anticipated project.
The MD/CEO of Unity Bank Plc, Mrs Tomi Somefun, represented by the Directorate Head, Lagos and South West Zone, Mr Wale Ogunride, was quoted as saying, “We looked at the strategic importance of this project and how such infrastructure could contribute to stimulating economic activity and decided that Unity Bank must play its part.
“Unity Bank will continue to provide support to such projects as we have been doing in other critical sectors of the economy such as agriculture.”
In a separate statement, the Executive Director of Wema Bank, Mr Oluwole Ajimisinmi, was quoted as saying that his bank was delighted to be one of the institutions to support SCOA in the project.
He also encouraged and solicited for more local content in order to create more jobs.
NBS Report: Nigeria’s Inflation Rate Dropped Further to 17.01% in August
Nigeria’s inflation rate has dropped by 0.37 per cent to 17.01 per cent (year-on-year) in August, from the 17.38 per cent recorded in July.
This was disclosed in the Consumer Price Index report just released by the National Bureau of Statistics.
According to the report, composite food index also dropped to 20.30 per cent against 21.03 per cent in July.
“This rise in the food index was caused by increases in prices of bread and cereals, milk, cheese and egg, oils and fats, Potatoes, yam and other tuber, food products n.e.c, meat and coffee, tea and cocoa,” the report read in part.
At the same time, the country’s urban inflation rate fell to 17.59 per cent year-on-year, from 18.01 per cent recorded two months ago, rural inflation rate tapered to 16.43 per cent from a previous 16.75 per cent, while core inflation, which excludes the prices of volatile agricultural produce dropped by 0.31 per cent to 13.41 per cent in from 13.72 per cent recorded in July.
“The corresponding twelve-month year-on-year average percentage change for the urban index is 17.19 per cent in August 2021. This is higher than 16.89 per cent reported in July 2021, while the corresponding rural inflation rate in August 2021 is 16.03 per cent compared to 15.73 per cent recorded in July 2021,” the report further stated.
Dangote Partners NCDMB on Oil Sector Research, Development
Dangote Refinery has announced a partnership with the Nigerian Content Development and Monitoring Board on the promotion of research and development in Nigeria’s oil and gas industry.
According to a statement from the firm, Dangote refinery was a platinum sponsor of the second edition of the NCDMB Research and Development Fair and Conference 2021 in a bid to show its commitment to the project.
The statement also said that Dangote refinery was able to showcase its 650,000 barrel per day project and the research and development activities it had carried out during the construction of the refinery at the fair.
The Executive Secretary of NCDMB, Mr Simbi Wabote, commended the company’s support for the fair. He expressed the need for companies in the Nigeria oil and gas sector to start nurturing the growth of the country’s home-grown technology rather just being wholesome consumers of other people’s innovations.
Wabote was quoted as saying, “Analysis of global practices of Research and Development revealed that the combined R&D spend of just five countries makes up 63.5 per cent of the entire global R&D spend. These five countries, namely USA, China, Japan, Germany, and India were also observed to have accounted for over 50 per cent of the global Gross Domestic Product.
“Africa, on the other hand, accounted for less than one per cent of the global R&D spend while its GDP is only three per cent of the global GDP. You will agree with me that there is a nexus between the spend on Research and Development and economic prosperity,” the Executive Secretary added.
The minister, represented by the Permanent Secretary, Nasir Sani-Gwarzo, also called on industry stakeholders and youths across the country to take advantage of the NCDMB R&D centre to bolster adaptation of existing solutions and also come up with new ones to address major challenges in the industry.
The Bayelsa State Governor, Douye Diri, represented by his deputy, Lawrence Ewhrudjakpo was quoted as saying that the theme for the fair captures stakeholders’ collective commitment to aggressively drive innovation and position the oil industry on the path of an integrated energy sector, where field development and production solutions are sourced through local capabilities.
He emphasised the need for private sector operators to invest in research and development. “It is important, however, to clear up a certain misconception: The funding of research is not the sole responsibility of National Governments; rather, big spenders on research and development globally come from the private sector,” he added.