Erisco Foods threatens to suspend operations
Erisco Foods Limited, an indigenous food manufacturing company in Nigeria has threatened to suspend its tomato farming and tomato paste processing operation due to what it alleged to be the deliberate killing of indigenous manufacturers by Central Bank of Nigeria (CBN), NAFDAC and the Federal Ministry of Industry, Trade and Investment as their policies fully support importers of finished products. The Managing Director/CEO of the firm, Chief Eric Umeofia disclosed this to reporters when some of the workers staged a protest against the planned suspension of its multi million Naira tomato paste processing plant in Lagos.
Chief Umeofia lamented that the planned suspension was as a result of their inability to source Foreign Exchange from the CBN to import machineries, machine spare parts and the necessary raw materials used for the production of Nigerian fresh tomatoes to produce tomato paste, whereas the same Foreign Exchange is given to companies that import finished products. He alleged that an Indian Company was allocated USD15.1 million in a single bidding while local manufacturers like Erisco Foods have not gotten FOREX allocation in the last two months.
Umeofia disclosed that, “It is difficult for indigenous manufacturers to access FOREX despite CBN’s promise that priority will be given to local manufacturers and 60% will be allocated to manufacturers.
Unfortunately, the same CBN has consistently approved FOREX to companies mostly owned by foreigners to import the same finished tomato paste and other items like frozen fish, fish heads and supermarket items that we don’t need at all or can be produced better in Nigeria”.
He further disclosed that the difficulty in accessing the various CBN’s intervention funds, lack of adequate government’s support for indigenous manufacturers and lack of market for made –in – Nigeria goods; the deliberate strategy of encouraging the importation of products that can easily be produced locally like Fish Head, Tomato paste, razor blade, supermarket items; excessive high interest rates that discourages and balloons their operational cost thereby making the prices of their products high due to high cost of production and obvious difficulty by manufacturers in accessing FOREX after CBN promised and indeed directed banks to allocate 60% of their FOREX to manufacturers are part of the reasons why he wants to suspend the tomato paste processing plant in Nigeria.
Umeofia equally decried the activities of importers of tomato paste in the country as their activities are destroying the economy of Nigeria as well as killing local manufacturers. He said, “We have a stock of tomato paste worth over N6bn now which we couldn’t sell due to the activities of these people. We have complained publicly and officially to all the relevant government agencies with loads of evidence, but regrettably nothing has changed till date. We will be forced against our patriotic wish to relocate our operations to a country where there is conducive and favourable environment for manufacturing if within 30 days from now nothing significant is done by the government to address these issues. We will lay off 1,500 of our employees in the factory, replicate our $150m investments in another country and from there import tomato paste to Nigeria.
The workers of the company had staged a peaceful protest against the management’s plan to suspend its production worth about $150m. The workers were seen carrying placards and chanting songs around the factory premises in Oregun, Lagos.
The Area Sales Manager, Erisco Foods, Mr. Ayoola Oladayo, urged the Federal Government to save their jobs by intervening in the situation of the company. He said, “We appeal to the government to save our jobs and families. The unemployment rate is alarming and we do not want to be classified as jobless in this harsh economic situation of the country. About 2,000 of us will be affected in various factories if the company shuts down. We urge the government to assist Erisco Foods and other indigenous manufacturers to continue to contribute to the country’s GDP.”