Given its chequered history, Nigerians ought to be forgiven for taking the statement credited to the Minister of Mines and Steel Development, Abubakar Bawa Bwari, on the status of Ajaokuta Steel Complex, with a pinch of salt. At a media parley last week, the minister said that 11 companies are waiting in the wings to take over and turn around the fortunes of the multi-billion dollar complex.
Moreover, that the legal issues which the complex had been entangled in have now been resolved; and finally that the move to concession the firm to an entity with the financial muzzle, technical know-how and genuine commitment to the nation’s steel sector development, was still on course. He, however, did not disclose when the privatisation process would commence.
On the status of the former concessionaire, the minister was emphatic: “Global Infrastructure does not have a stake in Ajaokuta asset. We have signed an out- of -court settlement, signed and modified concession agreement” (he would in another breath admit that the Iron Ore Company, Itakpe, built to supply raw materials to the steel plant, remains firmly in the hands of Global Infrastructure).
The arrangement, which subsists for seven years, he claimed, was part of the out-of-court settlement with the Indian company after the botched transaction on Ajaokuta.
To say that we are disappointed with the near stasis in a sector said to hold the key to the nation’s industrial development is to put things mildly. Just as the process has been slow, equally worrisome is the lack of transparency that attended the terms of resolution with Global Infrastructure. Moreover, that the so-called “progress” credited to the minister was the best the administration could do in the whole of the last three and half years no doubt says a lot about the steel sector’s place in the administration’s list of priorities. Just as the dithering is inexplicable, the clear lack of roadmap to the completion for a project said to be 98 percent completed is, to say the least, astounding.
The least the Buhari administration can do at this time is to step up on the process. One particularly commendable move is the on-going work on the 276-kilometre standard gauge rail line linking Warri in Delta State to Ajaokuta. Ensuring that this – as indeed other ancillary projects – fits into the iron and steel development matrix as originally conceived should be the end goal if only to ensure that the potential of rail transportation in that corridor are fully optimised.
We understand that the dominant thinking in government is for the complex to be handed to a company that has the funds, technical-know-how, commitment and grasp of international politics of steel. The problem here is the lack of a firm resolve on the part of the Federal Government to get things moving, hence the extraordinary move by the National Assembly to force the hands of the executive. We refer here to the bill seeking to establish a fund for the completion of the steel firm passed by the House of Representatives on March 28, 2018; a similar bill was passed by the Senate in December 2018, this time with $1 billion provision from the Federal Government’s share of excess crude revenue for its immediate completion – both underlying the parliament’s, as indeed, citizens’ frustrations with the slow pace of progress, while seeking to rev up the momentum in the sector.
Yes, we agree that the Ajaokuta issue goes beyond throwing money at the problem. And that the long term interests of the sector will be served with private investor coming on board. But then, it is also a fact that the government has done too little to move things in this direction. In any case, that option is only one among many available to the government to get the job done. Considering how strategic the project is to the nation’s economy, we haven’t seen much of direct, government-to-government negotiations as would be expected in such circumstances to advance our steel aspirations. Or, is the government saying that the latter option is not worth considering?
Forced to choose between elusive investors whose interests are oftentimes diametrically opposed to our national interest, and the alternative, which is to put more funds if only to salvage the $10bn already sunk on the steel company, we would have no hesitation to vote for the latter.
Credit: The Nation
