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Ajaokuta Revival: Buhari’s unfulfilled dream, work for next president

By Mohammed Bougei Attah
24 February 2023   |   4:16 am
On January 15, 2015 in Lokoja, Kogi State, President Muhammadu Buhari made a promise to resuscitate the ailing Ajaokuta Steel Company if elected into power by March of same year. This was during his campaign for the presidential election.

President Muhammadu Buhari.

On January 15, 2015 in Lokoja, Kogi State, President Muhammadu Buhari made a promise to resuscitate the ailing Ajaokuta Steel Company if elected into power by March of same year. This was during his campaign for the presidential election. As faith would have it, Buhari became Nigeria’s President and was sworn in on May 29, 2015

In his words, Buhari said the campaign “Resuscitating the company which has been out of production for the past thirty five years would enable it to generate employment for the nation’s teeming youths and create wealth for the country” Nigerians, and indeed the world believed that Ajaokuta Steel Company Limited, ASCL, is back to the Centre of discourse and attention.

Following this promise, and after series of consultations, Buhari travelled to Sochi, Russia in October 2019 to commence the process that led to the current state of the plant. He noted, after the Sochi meeting of the two Presidents which came on the heel of the Russia-Africa Summit that “The definite high point was the decision by the Russians to agree to a government-to-government understanding that would see them return to complete the Ajaokuta Steel Rolling Mill and commission it. Despite this outing and promises, there was another 18 months of standstill after meeting with Putin, the Russian President on a Bilateral Agreement. Buhari’s first tenure of four years, between 2015 and 2019 did less to actualize the above.

Drawing from these administrative bottlenecks and the need to keep the promise of the Buhari administration on Ajaokuta, the House of Representatives in February 2018 promised to join the battle to raise $500million needed to complete the last phase of the Ajaokuta Steel project. This assurance was made under the then Speaker, Yakubu Dogara. He said “except the political will is lacking, getting the funds to complete the company should not be an issue, given the importance of the firm to the country’s development”

What has been the position of the lawmakers after this pronouncement? Is there any political will to achieve this on the part of the executive? These questions are still unanswered.

Prompted by series of reminders by concerned citizens and stakeholders to keep to that promise made in 2015, the government of Buhari inaugurated the Ajaokuta Presidential Project Implementation Team, APPIT in May 2010 with the Secretary to the Government of the Federation, Mr. Boss Mustapha as the Chairman. The high point of the inauguration was the reecho of Buhari’s visit to Russia on the basis of a Government-to-Government agreement with funding from the Afreximbank and the Russian Export Centre. The Mustapha Committee (Team) further raised the hope of Nigerians, noting that the company is now under the supervision of the President.

The Boss Mustapha Committee further informed the public that one of the key issues discussed by the party, that is Russia and Nigeria, was the Technical Audit, upgrade, completion and Operation of the Ajaokuta Steel Company. The inauguration of APPIT he said therefore was meant to kick-start the process of re-directing the activities of the Steel Plant with the aim of bringing the Steel Project back to life for the growth and economic development of our dear nation“ Subsequent events after these assurances leave much to question.

From the year 2019 when APPIT was inaugurated till about October 2020, it is on record that no serious activities on the promises took place; neither did the Committee meet more than once. In another related media briefing, the Minister of Mines and Steel Development, Arc. Olamilekan Adegbite said the delay in fast-tracking the ASCL to four major factors which he classified under Force Majeure and include Boko Haram insurgency, COVID 19 phenomenon, the national flooding of October 2022 and the legal case at the International Court of Arbitration

True to type, the excuses do not justify the delay to resuscitate the plant, until September 2022 when the government finally settled the judgment debt to the tune of $496m as against the $5.3b claimed by the Indian company, Global Steel Holding. This action drew accolades and commendations to the government with the hope that settling the Nigeria’s debt has now freed the plant from all legal encumbrances. It was therefore hoped that the coast is now clear for full engagement on the Ajaokuta revival.

In this wise, what is however left to address is the political will, and possibly that the technical audits of the plant can now commence with the availability of funds. Giving, that the Minister Arc. Adegbite had earlier assured the country that after the Force Majeure, the technical audit will be conducted as money was released earlier, and Nigerians were hopeful that the Ajaokuta promises will now become a reality.

As reported in the Economic Confidential of July 16, 2019, an audit of the Plant conducted by Ukrainian and Nigerian engineers, technicians and other professionals under the supervision of two Ukrainian experts was submitted to the former Minister of the Ministry, Mr. Bawa Bwari in April 2018. This according to the Report revealed that a total of $652m is required to reactivate and complete the steel plant. Our investigations however showed that these audits were independent and there was no time a report of the audit of the plant was presented to the Ministry. If any, this would have happened under the tenure of former Minister, Kayode Fayemi or at a time Bwari acted as Minister for few months when Dr. Fayemi resigned to contest the governorship election in Ekiti State.

On the Power Plant audit, it was rumoured that a section would be audited by a British firm in collaboration with a local company at no cost to the country. Again this was one of the public briefings in April 2022 by the Minister on the Plant. The Ministry gave further assurances when it said that for the entire process to be transparent, a firm was appointed in 2018 as Transaction Advisor. The firm was said to have been ‘validated’ by the Bureau of Public Procurement, BPP “and will guide and ensure a transparent process in the selection of eventual firm for Ajaokuta steel restoration. What this mean is still strange in the minds of CSOs and experts in the industry.

The question on the lips of Nigerians, particularly CSOs and experts in procurement are many. One is, who is this Transition Advisor appointed by the government to engage the transition of ASCL? What was the method adopted in the selection of the firm? What is the technical knowhow of such firm to carry out the expected roles, and who are the directors of this company among others? Nigerians are yet to get any meaningful response to these queries till date.

In clarifying the stance of the Ministry, and driving away from the reality then, Arc. Adegbite had assured the public of an “irreversible status” reached by the Buhari administration in the process to reviving the plant. This in his words means that “the revival of Ajaokuta Steel Company is on track and cannot be reversed to status quo” This indicated that the Buhari administration will not fulfill its promise to make Ajaokuta a functional plant before it leaves office in May 2023. But can we take the words of the government on this project serious? The incoming administration may think differently

Earlier in November 2022, Adegbite raised hope on the Ajaokuta revival during the 2022 Nigeria Mining Week in Abuja. He said: “Steel development is a priority of the Buhari administration. As such the Ministry (Mines and Steel) has intensified efforts in revamping the Ajaokuta Steel and the Iron Ore Mining Company in Itakpe. The assets of the two companies have been secured and freed from all legal encumbrances”

As we seek to engage the transparency and genuineness of the process, the Minister of Mines, Arc. Adegbite on Monday 23 February 2023 while presenting the achievements of his ministry at the ninth edition of President Muhammadu Buhari’s Scorecard 2015 to 2023 series, organised by the Ministry of Information and Culture, shocked the nation as he announced that “As we speak, eleven companies are presently involved in the concession bid for Ajaokuta Steel Company but, we are still committed to ensuring that the company was concessioned to a competent bidder with technical and financial capacities to optimize its potential.”

Now it is good to ask that beyond the legal and administrative bottlenecks, what are the internal factors affecting the takeoff of revitalizing the steel plant? In August 2021, the national CSO Coalition for the Revival of Ajaokuta held its First National Conference on Ajaokuta Steel Project and President Muhammadu Buhari Industrialization Agenda’ The confab’s main objectives sought to review the current situation regarding the steel industry and proffer solutions to the challenges facing it’s full completion and revitalization.

The organizers of that conference said it had become necessary to resolve issues delaying the revival of the steel plant to full operations, and the take-off following the inauguration of the APPIT in 2020. One of the recommendations before the conference was for President Muhammadu Buhari to engage foreign partners to audit Ajaokuta Steel Company Limited (ASCL) and National Iron Ore Mining Company (NIOMCO), invite local investors to ensure quick return to production and reduce unemployment among youths and the citizenry.

Chairman, African Citizen Development Foundation, Lagos, Otunba Dele Ajayi-Smith; State Level Stakeholders Chairman, Dr. Idris Jimoh; Next Generation Youth Initiative International, Makurdi, Ambassador Onoja and VOA Africa Office, Abuja, Hajia Medina Nadabo, signed the communiqué. It stated that the delay in the revival of the steel industry spanning over 30 years had caused untold hardship on workers, retirees, youths and women with skills and are trained but not utilized, thereby, increasing redundancy, capacity gaps and unemployment in large scale and crimes that have caused serious economic sabotage among others

Beyond the recommendations of the Conference, the group had earlier advised President Buhari to as a matter of urgency and national interest move the steel company from the Ministry to the Presidency. The advice was informed by series of administrative bottlenecks, low allocation and direct control over the affairs of the steel plant by the Ministry of Mines and Steel Development

Despite the call on the Minister by the Committee of the House of Representatives Committee in November last year to use the 2023 budget to fund Ajaokuta revival, it is shocking to see from the information on the website of the Federal Ministry of Finance, that only a insignificant sum of N200m was allocated to the plant this year. A feeder company, National Iron Ore Mining Company, NIOMCO got N1.7bn, while other steel rolling mills also got higher budget allocations. Nigerians are yet to understand the justification for these allocations. The Committee frowned at these tendencies as the Speakers of House of Representatives further directed that the current statutory allocation should be increased in three folds or more to enable Ajaokuta to function effectively.

A research on the problems confronting the revival of Ajaokuta Steel Company conducted by NGO Network, one of the members of the coalition, showed that the problems are more of internal than external. To close these unnecessary delays, forestall administrative bottlenecks and improve on the transparency in the administration of Ajajokuta plant, the CSO also urged the Federal Government in the year 2019 to, as a matter of urgency and necessity, consider the inclusion of a representative of civil society organization in the Ajaokuta Presidential Project Implementation Team (APPIT) to promote inclusiveness, ownership by the people and transparency.

As we enter the political period this season, the Minister of Mines and Steel Development, Olamilekan Adegbite, disclosed on Friday December 9, 2022 that: “Eleven companies, including three from Russia, are in the concession bid for Ajaokuta Steel Company. On December 17, 2022, a week after the announcement, the CSO Coalition, via a letter to the President, called on government to interrogate the ongoing privatization process of the company by the Federal Ministry of Mines and Steel Development. This was part of the resolution made at the recent meeting of the Steering Committee of the CSO Coalition to appraise the development on Ajaokuta revival since 2015 when this administration was sworn in.

From the foregoing, it is safe to conclude that the administration of President Muhammadu Buhari through his Minister, Arc. Olamilekan Adegbite has finally informed Nigerians that the Ajaokuta Steel project revival will not be completed during this regime. That the promise made was not fulfilled, and that the incoming administration has the responsibility to continue from the “irreversible point” of this administration. Are we back to square one on Ajaokuta?

President Muhammadu Buhari should however be commended for his efforts, which surpasses those before him. President Goodluck Jonathan abandoned anything ASCL just as the leaders before him. As Otunba Ajayi-Smith often maintained, “it is worthy of commendation and to thank President Buhari for coming this far in the struggle to revive the steel company after a neglect of over 40 years”.

Noting that Ajaokuta is now free from legal encumbrances, the process of concession put in place, funding as the Minister and the Legislators observed as well as political will are the next bridges to cross.

And now, as we look forward to another set of promises, the presidential candidate of the Peoples Democratic Party, PDP, Atiku Abubakar, says if voted to power in the next presidential election, he will fully revive the iron and steel company in Ajaokuta, Kogi State, to create jobs for teeming young Nigerians. Atiku disclosed this at the confluence stadium in Lokoja in February during his presidential campaign rally, saying that a vote for him is a solution to the challenges bedeviling steel plant.

On another note, the presidential candidate of the All Progressives Congress, Bola Ahmed Tinubu, has said he will revive the Ajaokuta Steel Complex in Kogi State and dredge the River Niger if elected into office. He also made this promises while speaking at the APC campaign rally in Lokoja, the capital of Kogi State in February this year. What happens after May 29 this year is what we should all watch out for.
Attah is the Executive Director, NGO Network and the National Coordinator, CSO Coalition for the Revival of Ajaokuta Steel Company.