PZ stakes N91.5b in backward integration

Urges investment in palm oil production

The Managing Director and Chief Executive Officer of PZ Cussons Nigeria Plc, Christos Giannopoulos has said the organisation invested about N91.5 billion ($300 million) as of measures to implement its backward integration plan in the country.

Calling on industry players to grow local content as way of reserving foreign exchange in the country, Giannopoulos, who was Guest Speaker at the October Breakfast meeting of Nigerian-British Chamber of Commerce (NBCC) in Lagos, also said Nigeria would meet demand in palm oil production if players come together and increase the amount of palm oil production in the country.

Speaking on “Manufacturing sector as catalyst for economic growth in Nigeria”, Giannopoulos stated that manufacturers in the country must take advantage of necessary opportunities to source local materials, backwardly integrate, innovate and build skills.

“The amount of money the country spends yearly on importing raw materials for production could drastically reduce if necessary sectors, particularly petrochemical refineries and palm oil production facilities are in operation”, he stressed.

Giannopoulos said: “If today after our plantations are fully grown and we are producing palm oil, we will reduce our import cost or requirements by about 25 per cent and when the petrochemical refineries are built or fixed. We will also reduce our import cost by another 25 per cent. Only these two will reduce the amount of dollar we use on import by half.”

He disclosed that the organisation is in talks with key stakeholders, particularly the ministry of science and technology and National Agency for Food Drug Administration and Control (NAFDAC) in order to bring together manufacturers and other players in the sector to discuss complementary steps.

Giannopoulos said though the country may not be able to grow local content overnight, but current efforts showed that the nation is heading in the right direction.

Speaking on transfer of knowledge, the MD said that the organisation recently signed agreement with Ministry of Agriculture to transfer knowledge from Asia, in order to develop high yielding palm oil seeds in Nigeria.

According to the NBCC president, Adedapo Adelegan, notwithstanding the current state of the economy, Nigerian Manufacturers are upbeat and have a positive outlook on the economy over the next year, with 76 percent expecting economic conditions to improve.

He lamented that chronic challenges of infrastructure and inputs continue to hinder the sector to transit from a demand-driven regime to a supply-driven regime essential for long-run growth.

Adelegan said: “In the modern world, manufacturing sector is regarded as a basis for determining a nation’s economic efficiency. However, after the discovery of crude oil in Nigeria in the late 1950s, the nation had shifted from its pre-eminent developing industrial production base and placed heavy weight on crude oil production not only has this jeopardized its economic activities, it also aggravated the nation’s level of unemployment.

“Nigeria as a giant of Africa has for long been regarded as a nation blessed with abundant human and material resources; however, the under-utilization of these potential has amplified widespread poverty, low standard of living at individual level and rising unemployment in the country as a result of incessant mono-economic practice and drastic neglect of other sectors of the economy such as agriculture, tourism, mining and the manufacturing industry.”