The Chairman, House Committee on Steel Development, Hon. Sadiq Asema Mohammed, in this interview with Ruth Tene, gives an expose on the potential of the steel sector and the need to complete Ajaokuta Steel Mill.
You say the government is ignoring the steel sector; what are you and other legislators doing to ensure that this is changed?
The steel sector is a sector that many Nigerians are ignorant about; that is why we are having these problems of where we are today. First and foremost, we must know what the steel sector is all about in any economy: it is the front burner of any company; it is the front page – like you have the front page in every newspaper, the steel sector is supposed to be the front page of our economy if we are to move forward, but today the steel sector is at the back page of our newspaper and that is why we are where we are today. For instance, since Shehu Shagari left office in 1983 till date, there has been no concrete measures by any regime to complete the development of the steel sector. In the U.S., Italy, China, France, among others, they went through steel development in the past and, today, they have mature steel industries and plants across their various nations, and that is why, today, they can manufacture anything they want to manufacture. If you are talking of manufacturing, the real, basic area of our economy that will move Nigeria forward, it is the steel sector and, before you can talk of that, you must have completed the steel plants in place. Now, the only major steel plant we have now is the Ajaokuta Steel plant and the only mine we have is the Itakpe Ore Mining Limited: these two areas, whether government likes it or not, must be completed if Nigeria is to move forward, because these are the only two areas that can produce and manufacture rail tracks, building materials, bridges and all things iron – including aeroplanes and motor vehicles
What is the implication of not completing the Ajaokuta Mill?
If these areas are not completed, which economies are we driving at? Is it economy of flat roads, good water or clothes? We are talking of the mainstay of the economy, which is the steel sector. We cannot afford to neglect that sector, because most people in government do not know what we are talking about. Then the next thing you hear is they are talking about is privatization; some people say they know when they do not even know. They say they want to privatise the place. If they know, they will not be talking about privatization now. What they should be talking about should be completion, because no private individual will bring you $513 million approximately or bring similar amount to complete the external infrastructure remaining; and all over the world, the needed infrastructure of steel development is usually provided by government because it is only government that can provide the needed infrastructure. Thereafter, they can go ahead and privatise the management, but the way we are going now, the government is not having the political will to complete this project. They will tell you they have spent $4:6 billion on Ajaokuta, that is the more reason we must make sure we spend additional $513million to complete it; that is the reason why we should not throw it away.
What is the wisdom in continuously putting in money if the project is never ending?
That is the question people keep asking. They say the government has spent so much money on the steel sector and therefore they cannot spend again, but that is the more reason why you should spend more money and finish it. Anything worth doing is worth doing well. If we do not complete that sector, why did we start in the first place? If you have started, spending over $7 billion, how much remains to make it work, with what we have done, we only have five per cent to complete it, we have finished over 90 per cent. In the last one year, Russians came and were awarded a contract to do the engineering audit of NIOMCO and Ajaokuta, to know how much is left to finish. All together, it is not up to $1billion. How do you compare spending $4.6 billion at that time? That place now is more than? $100 billion; how do you now, because of $1billion remaining, throw the place away? Why can’t we go there and finish it? It is so small, so tiny in the life of a nation; so we should finish it so that we can now get value for it. Apart from that one, you have the advantages of employing there. You can employ over two? million persons there alone,apart from the foreign exchange you can have.
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Talking about employment, the Ajaokuta steel workers went on strike over the non-implementation of the new salary scheme; what is the wisdom of paying a non productive company?
In fact, this is the first time I have? seen the federal government having a very humane wisdom to take that step to retain the workers without sending them away, because it is obvious that the federal government is convinced that they must complete Ajaokuta. If you know you are going to complete Ajaokuta, you cannot sack them, because these are the workers; staff trained from various steel plants all over the world – they are specialists. If you throw them away, by the time you want to start that place, how do you do it?? Do you again start sending people all over the world for training? So these are specialised people, trained in preparation for the takeoff of the plant. Now if you throw them away, when that place has not taken off, you are only defeating the original objective. They are not there to start work now, because the needed money has not been put in; this are the original indigenous people who will start manning the place and making it work and make Nigeria proud – when we can say 'made in Nigeria'. Right now, the place is a huge plant, you have the heart of the plant inside the ground buried and half outside; so you need staff to be there to keep it alive. If you throw this guys away , you will not be helping the place. When the last audit was carried out by the Russians last time, they said that place was in perfect shape, and not in rotten shape as people have been claiming so that they will go and buy the place at a cheap rate. When they say the place is not good, the fraudsters are preparing our?? minds so that they go and buy the place at a cheap rate, say $300 million for a property worth over $100 billion.
Looking at the past failed privatizations of Ajaokuta and other steel sectors by Gen. Abdulsalami Abubakar (rtd) and President Olusegun Obasanjo, do you not you think this one will fail again?
In the past, privatization of the steel sector failed. The main government that privatised the steel sector was the Obasanjo regime, which privatised Oshogbo Steel Rolling Mill, and the ones in Alaja, Katsina? and Jos; these? rolling mills failed, because they needed infrastructure and this can only be provided by government. The rolling mills, how can they work when their mother, Ajaokuta, is not working? The billets and some of the raw materials are supposed to be produced from Ajaokuta. It is like, after the main thing , then the rough ones are given to them for usage; how can they get these raw things to use in the rolling mills.These mills rely solely on Ajaokuta and it is not working. NIOMCO that is supposed to be supplying very high quality grade of iron ore to Delta Mill, instead of importing them from Guinea, is still in limbo. The first, second and third lines are still sick; then how can these areas work well to feed Alaja Steel. These are the problems we are having; so if Ajaokuta? and NIOMCO are working now, most of these steel rolling mills will work. But if government wants to privatise now, they are only causing more problems for the country, because if you privatise Ajaokuta, no private investor will come to invest there that will provide you with all the external infrastructure you will need to operate Ajaokuta, neither will they give you $513 million to complete the furnace that roars which our foreign detractors fear. They do not want to hear Ajaokuta roar, or the hot stone, because the sound of the roar is that it is working, and that is the only time it will provide liquid steel; when it roars, it means Ajaokuta is working and then you can now get every other thing you want to get in perfect shape, and what this means is that all the external infrastructure will have been completed. That is, the dredging of River Niger would have been totally done, because most of the heavy load coming from abroad will go by water; the rail line from Warri again to Ajaokuta must have been working perfectly, then from Itakpe they can now send Iron Ore direct to the furnace, then the rail lines to all the sites would have been put in place. These are the external infrastructure we are talking about; once all these furnaces are working, the raw materials? will come in directly and feed the furnace. But if? they are not completed, who can do it except government.
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Are you saying there is international and local conspiracy to kill the steel sector in Nigeria
That is the summary. What we are saying now is that our detractors are trying to make sure that we say we are privatising so that Ajaokuta will become a white elephant project; that is the dream of our detractors? and disciples of Bretton Woods in this country who are saying privatization. Why do you not privatise the Ministry of Internal Affairs or the National Assembly; it is because privatizations has limits. Areas where people cannot go into but only government, you do not privatise such areas. There are exceptions to issues in the economy you can privatise. This bulky area, you cannot say you are leaving it in the hands of foreigners without your national interest attached. You know what steel is; it is valuable to different sectors. All these things you see in the public sector – whether it is gun, mortars or aeroplanes, or you want to go to the moon, it is steel; so any nation will have its own national interest attached to steel development
The Mohammed Lawal report alleged that companies that bought the Ajaokuta Steel company cheated Nigerians and asked that those companies pay a refund; what is the House doing to ensure compliance?
One thing I have always said is that we in the legislative arm of government are prepared to support the executive to develop the steel sector to conclusion, before privatization. That is what is done in all parts of the world before they have steel sector economies in place; those that bought Ajaokuta Steel did not even pay Nigeria N1; they said they will pay $250 million, but there is no receipt, no bank documents to show that they paid N1 to the Nigeria economy – nothing; instead even the iron ore that was found and mined down in Itakpe? worth billions of dollars were evacuated and sold off to India and China. Now, all these things were possible because Nigeria has no law regulating the steel sector. The steel sector is a? barren place where there is no law to set standards and regulate, monitor and sanction; the only law they had was an agreement between them and the federal government – of one and a half page governing such a sector. That was just a fraud on the economy. If there was a law, they could not have left to sue Nigeria in London. So they had to fashion their own law to sue Nigeria in London.
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