Chemical and Non metallic Employer Federation of Nigeria has accused the government and people of Benin of deliberating sabotaging the Nigerian economy through state sponsored smuggling. Making the accusation yesterday, the President of the federation Mr. Devakumar Edwin who is the Managing Director of Dangote Cement said that industries in the country are folding up not because of power and infrastructural challenges but because of the Benin Republic state sponsored smuggling into Nigeria of low quality products that are cheaper than locally produced goods. He said industry membership of his federation that stood at 145 has dwindled to 92 with a total lose of 270, 000 jobs in the last few years. He said that more companies are at the verge of folding up. He urged the fedral government to shut the border in order to check the menace of state sponsored smuggling into the country.
Mr. Edwin declared “We made a detailed study on why this is going on and we realised that the state of Benin is acting as an official sponsor of smuggling. The Dangote group has been in the business since 1992 and we have seen how the government of Benin encouraged smuggling by keeping a loyal group of smugglers so that they can generate revenue from the group and the group were coming into Cotonou and then crossing the border into Nigeria.
“What we have done before now is to try to manage the situation as much as we can but today what we have seen is a state sponsored smuggling. What we have realized is that at the top level in the government of Benin Republic, there are people who have significant interest in smuggling. So, now it’s not just about people trying to take advantage of situations and loopholes, it is state sponsored. So they are ensuring that most of the goods coming into their markets are then smuggled across the border. The Comptroller General of customs has been trying to do his best but he has limited men and resources available.
“We see the Nigerian government trying to help industries and the ministry as well and the CG is trying to curtail the smuggling going on but once it’s a state sponsored, it’s difficult to manage. Take rice for instance, if you take the data from customs and you see the data of rice shipment from Cotonou, 2.2million tons of parboiled rice is shipped into Cotonou and all of us know that nobody in Cotonou use parboiled rice. Parboiled rice is used in Nigeria. So why would the government of Benin allow 2.2million tons of rice into their market when they know they do not need it? So you can understand that it is being sponsored by top people in the government. So if the state is sponsoring smuggling it will be impossible for customs to control smuggling as much as they are trying today.
Continuing Mr. Edwin further said “We realised that one of the biggest problem affecting existing operators in this industry is the smuggling of goods across the border to the country. Everybody knows that that is what affected textiles, nothing else. Something like textile coming from China, India and Pakistan destroyed the textile industry in Nigeria. Before then, we also had the challenges of power, poor road infrastructure, and high financial risks. I remember in 1992 when we are doing restructuring of the Nigeria industrial needs, I was borrowing as high as 62 per cent, we were surviving and managing very well but when the smuggling started coming in they just destroyed the business.
“We also realized that this is one of the key issues that are affecting businesses today. We did an analysis and we could see how the tyre industries were all shut down, shoes and drugs, soap tooth paste, perfumes, and cement. These are being smuggled across the Benin border causing the local industries to shut down.
“Yes there are some other challenges affecting businesses but this is one single issue which is affecting most of the businesses. It has affected mostly the textile industry and most of our members have shut down their operations”.
Mr. Edwin also said “We used to have a membership of 145 but today the membership has dwindled down to 92. This gives us in the industry some concerns because I used to play a very key role in the textile industry. As you know, the Dangote group started the business in textile in 1991 and 1992. We had one factory in Kano and another one in Lagos. There is a similar issue affecting the industry and as you know, the textile industry used to be the second largest employer of labour in the country. It had a huge number of unemployers and huge number of factories, but now we see the numbers dwindling down and we are very concerned about the impacts on the investment, industry, employers and the impacts on every other stakeholder. It’s going to have a major impact on the economy too because this will result to high unemployment and we are very concerned about the increasing unemployment in the country.
“New graduates are not able to find job and people who are already having jobs are being thrown out of their jobs. We really want to see how we can highlight this significant issue and analyse some of the key issues that are affecting the business, but at the same time there are other common issues which are affecting every other businesses in the country. They are issue like power, infrastructure, and others issue like high financial charges and other common issue which affect all other businesses.
“But if you see the last two years, there have been increase in foreign direct investments and significant expansion in business and we are the ideal candidate of showcasing to the world how we have been investing in businesses. We have been investing in expanding businesses and we have been investing in new businesses. You can see a contrast, yes, there are still issues of major concerns but at the same time there are still companies which are trying to survive. So what should concern all of us is why these issues are affecting all the industries; the entire spectrum of industries across Nigeria. We need to know how businesses that are coming in are doing. So unless we get a detailed analysis of how businesses are doing, most of the existing operators, we cannot find a solution. We did a detailed analysis of the issues affecting Nigeria and we realized that the government is really trying its best. They have given a lot of support and the National Economic Management Team that has been set up has been contributing significantly. So the government has made significant efforts to see how the new industrial development can be given support. And same way the Minister of Trade and Investment has been trying to do his best, trying to see how he can support the industries, so that industrial growth can be improved. There is support from the president and support from the minister and most industries have benefitted.
