Nigerian Iron And Steel Sector Is Set To Lead Africa.

Alh. Ahmed Mohammed Gusau, Minister of State for Mines and Steel Development Financial Vanguard cornered him for an exclusive interview at the summit, where he talked about government policy towards the sector; Ajaokuta Steel Company Limited (ASCL), the Nigerian Iron Ore Company (NIOMCO) Itakpe, and on some key infrastructure for iron and steel development in Nigeria. 

He also revealed for the first time, how his ministry is making efforts at inspecting and certifying all locally produced and imported iron rods into the country, in the face of many collapsing structures in the country today. 

He finally begged Nigerians to be patient with the pace of the present government, saying: “We are not a go slow government.” 

This is the second day of the summit, and a lot of people have said they are overwhelmed by the magnitude and quality of people in attendance, what does this bode for the Nigerian Metal sector? 

This is a sign of confidence. That means that Nigerians and foreigners have a high degree of confidence in this administration. It’s a statement of faith in the ability of the Umaru Yar’Adua government to move this country forward. I have no doubt in my mind that if these people have no serious intention of investing, of finding a way forward for the sector, they would have all moved away after yesterday’s opening ceremony. And you saw that the attendance was so large. I think that these gentlemen and women have seen the sincerity and the commitment with which the present government is driving the sector to contribute to the economy. And, indeed we are genuinely committed to it. As a nation, with a strong agenda for growth, we cannot afford not to do that. I want to assure you that we will do the right things sorted out in this summit. We have all the submissions and update contact of all participants including their e-mails and all that. 

 And a committee that will be formed after this summit will relate with everybody. The committee will condense every paper that has been given, it will bring out the salient aspects of each paper and that should form a roadmap. Yes, all the papers, submissions and contributions of participants should give us the roadmap. This roadmap would lead Nigeria to become a giant in steel development on the continent of Africa. This should put us among major steel producers in the world and, would catapult us to the 20 most industrialized countries by the year 2020. 

There is strong presence of foreign investors and foreign experts in the metal sector, what specifically did they express as their interest in the Nigerian metal sector? 

Yes, you are right, there are many of them here. Yes, in the course of the deliberation, somebody even came and said: “Look I am from the United States of America. I have come to represent some financial institutions. We have money to disburse for any serious, willing investor”. You see! That means that there is absolute confidence in Nigeria to the extent that people are willing to bring in finances and invest now. That is good news for every Nigerian. And there were many of such expressions from people from Cairo, China, from the UK, the US, Germany, India, Russia and so on. Some of them are representing multinational companies. This means that they know about our potentials. They know that we have put in place the right policies and the right incentives for them. They are here to see how they can invest so that  both of us can make money and then complement our effort.  

I have no doubt in my mind that this sector will contribute its quota in the economic growth of Nigeria. 

ASCL was widely discussed, and as at now, I understand that one of the issues has not been resolved. Some participants feel strongly that with the backward integration of Ajaokuta Steel Plant, the company can be unbundled into subsidiary companies, each with its owner under some ownership structure they have advanced. Yet, some feel strongly opposed to that idea, saying Ajaokuta must be retained as one entity under one management. What will be government’s stand on this contentious issue?

You know this is a government of the people, by the people and for the people. 

We are going to gauge all the arguments presented here. The essence of tabling Ajaokuta for deliberation is for government to have the view of Nigerians, and even our friends from outside. Most of these people who have made their views known on Ajaokuta, have the technical knowledge and understand the economics of running steel plants. You cannot snub any of their views. Their views will give us an all-encompassing assessment of Ajaokuta in the corporate interest of Nigeria and the investors themselves.  

Yes, some are saying that some of the primary mills can be privatized. This group says that the main steel plant that will produce liquid steel should not be privatized. Their own argument is that when you control the primary source of steel, which is the liquid steel and flat steel, you now have the power to control development in your nation. They argued that some of the developed countries carry out such a practice. They were specific about India and the UK and some more countries. They believe that steel making should not be left totally in the hands of investors. They believe that these are areas of critical economic development _ liquid and flat sheets. 

 They say that if government controls them, at any time, government can call for more utilization of steel and that government can make steel production to synergize with government’s intention, as part of meeting government’s social responsibility. These among other arguments, are what we are going to look into with my officials. This will help us in advising government on finding which way to take. More so that, the Central Bank is here, the BPE, all the major commercial banks, some state governments have even sent in representatives. So it is a wide consultation, so we expect a wide and high quality advice from here. 

Still on ASCL and NIOMCO, it has been strongly made clear here by participants, that as long as the dedicated rail lines linking Delta Steel Company in Warri, ASCL and NIOMCO are not completed, the full value of the companies cannot be realised. This, they insist, also includes the dredging of the River Niger and clearing of the Escravos estuary to allow for large coking coal bearing barges. They say that liquid steel can never be produced in Ajaokuta without them. And, it is rather a matter of rude shock to industry watchers that government has always been very passive on this all important issue that has continued to tie down these multi billion-dollar investments for decades now. What is this present government’s attitude to these problems? 

It is not a matter of attitude. It is a matter of reality. This government is mindful of its social responsibility to the nation. For example, you ought to know by now that there is an integrated rail lines for the country.  And these parts of the country, where Ajaokuta, NIOMCO and Delta Steel are, will all form part of the Integrated Rail line. And I want to tell you that government is very mindful of these problems. And on the dredging of the Niger,  is also government’s responsibility. We are trying to get everything right this time around. These should not worry investors, as we will take care of them. 

But, don’t you think that this aspect of the Integrated Rail line should be handled with more urgency, rather than waiting for the entire national rail programmes, seeing that … (cuts in)  Don’t forget that government had awarded contracts on this particular rail line you are talking about, later it was concessioned out expecting that those guys who took over NIOMCO, Ajaokuta and DSC would be reasonable to complete it. But they did nothing. 

That was unfortunate. Now that we want to get things right without going back to the past mistakes, I believe that we will address it as quickly as we can, within the confines of the legal framework and the official provisions that we have. And I believe that the Ministry of Transportation is aware of the importance of these infrastructure and are doing everything humanly possible to address the problem. In this government, we synergise. It does not matter on what side you fall, we are here for the interest of all. 

What is the fate of the workers of NIOMCO and ASCL now? 

They are still on the staff role of the companies. And we are doing all within our power to pay them their salaries. When eventually government makes its final decision and someone comes on board, they must be taken into cognisance. At least, the necessary legal requirements of the workers would be met. No doubt about that. 

When will these workers be paid their salaries? 

One thing you must know  is that in this country, if you are charged with monetary responsibility, you must make sure that you get everything correct. You must ensure that those that are to be paid are the only ones that will get paid. You must guard against inflating salary packages, which will give room to corruption. We had to appoint a committee to examine staff strength, examine their entries, their files, documents and ensure that there are no ghost workers. Because we took over from an organisation that mismanaged the companies. And we cannot just afford to take over these companies’ financial responsibility without carrying out our due diligence.  

The committee is made up of highly qualified people from the ministry. It has a chattered accountant, a chattered auditor and people with the right knowledge. They have finished their jobs. And we are in the process of starting to pay. And we will soon reach out to them. And I am happy to note that the workers understand; they appreciate our motive. They know that we want to pay to only those who are existing. 

So how much are you putting in the Supplementary Appropriation for their salaries? 

I think that is best answered by the Ministry of Finance. Ours is to make proposals to them, and we have done so.

How much did you propose? 

I won’t tell you… (laughs)

Ok, so much for that. Sir, just a few days back, a shopping complex in Abuja collapsed and killed about 10 people. Also, almost everywhere in Nigeria, buildings are collapsing and claiming lives. Most people in the construction industry say that substandard steel is largely responsible for these tragedies. What is your ministry doing to combat this deadly problem? 

We are now going to strengthen our Metallurgical Inspectorate Department. 

 They will be starting by inspecting all steel-producing industries in Nigeria. And the Nigerian Metallurgical Centre in Jos is now going to be inspecting all iron rods brought into the country. And, we are asking government to make it that before a structure is put in place, our Inspectorate Department must  subject the iron rods to be used to some tests. I am talking of the National Metallurgical Agency because we have the tools for checking them. It takes just about 10 minutes to finish the inspection, and you get a certificate to say that, “this iron rod you are using is 100% certified.” The problem most of the time is that someone buys iron rods to be used for windows only, then he ends up building a five storey building on it. It cannot stand the pressure.  

It cannot work. We believe that we have statutory responsibility which we must exercise. We have sufficient manpower to inspect even import of iron rods. But, then the Ministry of Environment, the Ministry of Works and Transportation will have to cooperate with us so that before any building plan is approved, specification of iron rods must be given. The rods are then taken to the National Metallurgical Agency for test, and certification given. 

Back to the issue of the summit, when will the findings and recommendations of this committee you talked about be looked into and action taken by government? 

We are ready for action. We have the manpower, we have the right economic information, and we have the institutions and the departments. We are set. But, people must realise that we may be slow in taking action, but when we do, it means we are ready. We don’t believe in undue hurriedness. But, as you can see, every institution and individual whose idea needs to be tapped is here. So, as soon as we get the recommendations of the committee, we start. 

So when will Ajaokuta and NIOMCO be put up for sale? 

Look, we are trying to ensure that the mistakes of the past are never repeated. We have to be thorough and transparent before taking a decision. But, really, we are getting close to the point of taking a decision.  

In one month, one year’s time or …(Cuts in)  We are yet to decide 

Finally, what do you have to say to Nigerians? 

I want to call on all Nigerians to be patient with the government of Alh. Umaru Yar’Adua. This is a president that is as precious as gold. He has the commitment, the will and the determination to move this country forward. You cannot do any good thing in a rush. You cannot do any good thing without good planning. There must be checks and balances to the extent that you are sure that everything is put in place, and then you start.

Look at this summit. We did not start it, until we had the enabling law for the sector; until we have the regulations in place. With these, we can defend our stand. Investors are also made more confident to come in now. The Act, Policy and Regulation took time.  

We now have laid down regulation for the miners to engage with host communities. We have clear and stringent environmental regulations for mining, for reclamation and all that. It took time to plan. 

So there is nothing like “go slow,” this government believes in doing things right. It may just take some time, because we don’t want to through the trauma of policy reversals again. If things were done rightly in the past, we would not have been where we are today.

By Lukat Binniyat

"Financial Vanguard. Monday, 11 August 2008".