World Envelopes Day: Stakeholders decry neglect of paper industry, chart path to sustainable growth

Publisher, The Guardian Newspapers Ltd, Lady Maiden Alex-Ibru, has called on the government at all levels in the country to remove obstacles besetting the paper industry, to prevent it from total collapse.

Speaking in her capacity as the chairperson of FAE Ltd’s 50th anniversary celebration, which was marked with a business roundtable and inauguration of the global World Envelopes Day, held in Lagos, yesterday, she said the industry, which is very important and a major provider of employment, is heavily threatened.

On the pivotal role of the paper industry in the Nigerian economy, Maiden Alex-Ibru said sustaining the paper industry, despite the prevailing trend towards digitalisation, holds several key economic implications, including job creation and economic growth, adding that the industry employs a significant number of people, from paper manufacturing to printing and publishing, she said sustaining the industry will ensure the preservation of jobs and contributes to economic growth by generating revenue, taxes and export opportunities.

Stressing that while digitalisation has improved access to information, she pointed out that not everyone in Nigeria has access to digital devices or/and reliable Internet connection. “Sustaining this industry allows for the production of books, newspapers and educational materials; in a bid to ensure that information remains accessible to all. In some areas, where educational materials are limited, the paper industry ensures they do not lose out on education, by providing textbooks, workbooks and other learning materials. These physical resources are essential for students and teachers in areas with limited digital infrastructure.”

Adding that the industry also helps in preserving Nigeria’s rich culture and heritage with physical books, manuscripts and so on, which are vital for preserving culture, literature and traditional knowledge, she posited that while digitalisation can reduce paper consumption and promote sustainability, paper is completely renewable and a sustainable resource.

Urging the management of FAE Ltd to remain efficient and nimble, she said they should encourage the recycling of paper. “Regulatory compliance is key so keep engaging government at all levels to simplify and ease the burdens of Nigerian businesses.”

Speaking on threats to the survival of the industry, she listed the lingering economic crisis, digitalisation, reduced demand for paper globally, high diesel and petrol cost, poor power supply, costly FX to source raw materials, multiple taxation from federal, state and local governments and crippling overhead costs among others, as factors hobbling the industry and pleaded with the government and relevant stakeholders to fix these problems to save the industry.

Managing Director and Chief Executive Officer, FAE Ltd, Princess Funlayo Bakare-Okeowo, said despite the ever-changing socio-economic landscape in the last five decades, they have remained resolutely committed to providing quality solutions to the Nigerian real sector. Announcing the inauguration of the World Envelopes Day to be celebrated yearly on April 16, she said it is a pioneering initiative by FAE Ltd. “The establishment of this day is to raise awareness about the importance of envelopes in various aspects of human endeavour, including personal correspondence, business transactions, and creative expressions.”

Delivering the keynote address, the Chief Executive Officer, Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, hailed Bakare-Okeowo as one of the few women managing an indigenous manufacturing enterprise in the country, adding that the sector is one of the most challenging in the economy.

Regretting that the country’s vibrant pulp and paper industry between the late 60s and early 90s had become moribund, he said privatization could not save these companies from collapse. “This development made the paper industry entirely import-dependent. This was the beginning of the numerous challenges of the sector as the industry became highly vulnerable to exchange rate volatilities and FX market liquidity issues. The FX crisis made the situation worse, with many paper industry investments going under,” he said.

As of 2023, the value of the Nigerian paper industry was N398.8 billion, according to the National Bureau of Statistics. The value was N365 billion in 2022; N363 billion in 2021 and N255 billion in 2020. With a significant contribution to the GDP, when compared to the size of the economy, estimated at N230 trillion as of 2023, it is small.

“The paper industry has been largely in recession because of the digital technology disruptions and other macroeconomic headwinds, especially relating to FX depreciation, FX liquidity crisis, high cost of funds and energy cost escalation. The sector contracted by 1.47 per cent in 2022 and 0.56 per cent in 2023. This data underscores the imperative of policy measures to fix the current challenges facing the industry, both from the monetary, fiscal policy, structural and regulatory perspectives,” he said.

Listing the many uses of paper to the nation’s economy, he said envelopes serve a key purpose and urged that the factors inhibiting the sector be removed. “Paper manufacturers are facing increased competition from digital media, which can impact their profitability and sustainability. To remain competitive, the paper manufacturing industry needs to adapt to this reality and find new ways to use paper products that are not as easily replaced by digital media.”