A Dark Day for Nigeria’s Quest for Industrialisation

The federal government and members of the organized private sector have described the Kogi State Government’s incursion into Dangote Cement Plc as a big setback for the country’s quest for industrialization, writes Dike Onwuamaeze

Last week, the Kogi State Government invaded the Dangote Cement Plc’s factory in Obajana with the help of armed enforcers to seal the company over an alleged non-payment of taxes and revenues due to the state government.

But days before the invasion, the Kogi State Governor, Mr. Yahaya Bello, gave an indication that something untoward is in the offing. Bello said in a recorded video that “all efforts to sit down with the proprietor of Dangote conglomerate … … to realise the impending danger that the operation of Dangote in Kogi State is posing to himself, his investment, the people of Kogi State and Nigeria generally, fell on deaf ears.”

Bello claimed that the state government had received several petitions from the general public about the Dangote Cement for over five to six years now while all efforts made by the state government to sit down with the proprietor of Dangote conglomerate failed.

He said: “We set up committee to look into this matter and the report came …  And here we come to set up another technical committee to review that same particular report.

“This report was ready since September and I have gone through it. I have received a lot of accusations that I have interest; that every government that have come to this state have interest or have something to do in terms of shady deal with Dangote, especially as it concerns Obajana cement factory.

“So, ladies and gentlemen, I came into this office with my integrity and I will leave here with my integrity. As God will have it we have to now call on the committees to make their representations now because of misrepresentation of facts out there. Hence this particular report. I am here to defend and protect the lives and livelihood” of the people of Kogi State.

However the danger the governor warned about bared its face on Wednesday, October 5, and by the time the exercise to seal the company was over, scores of trucks belonging to Dangote Cement Plc were burnt and reduced to ashes while tens of its staff that sustained injuries, some from bullet fired on them, were lying in hospitals.

On Friday, October 7, the Group Managing Director of Dangote Cement, Mr. Michel Puchercos, said in press statement titled “Illegal Shutdown of Dangote Cement, Obajana Plant,” said that in the process of forcefully evicting the workers to enforce the shutdown, “the vigilantes shots at 27 of our workers and also destroyed some of the company’s property at the plant.”

The statement said: “The management of Dangote Cement Plc wishes to inform members of the public, especially its customers and other stakeholders of the recent invasion of its Obajana Cement Plant, Kogi State by armed vigilantes on the orders of the state government.

“The vigilantes, led by some officials of the state government were apparently acting on a resolution of the Kogi State House of Assembly on controversial tax claims; claims that the state governor had also contradicted when he said the shutdown was due to an alleged invalid acquisition of the company by Dangote Industries Limited.”

Puchercos added that steps have been taken to get the hoodlums apprehended by the law enforcement agencies, and we will ensure that full legal action is taken against them.

“We therefore appeal to all our staff and our esteemed customers to remain calm while we explore all possible legal steps to address the situation. The welfare of our staff remains our key focus as we work hard to minimise further impact on our people and operations,” he said.

Puchercos also cleared the air about the ownership of the Dangote Cement. He said: “While we reiterate that Obajana Cement plant is 100 per cent owned by Dangote Cement PLC, we remain resolute in transforming Africa, while creating sustainable value for our people, communities, investors and customers.”

The incursion of the Kogi State Government into the operations of the Dangote Cement Plc has attracted public condemnation from both federal government and members of the organised private sector. They heaped aspersions on the economic imbroglio created by the actions of the KGSG.

The federal government stated that the imbroglio have rubbished its programme on improving the ease of doing business and attracting foreign direct investments into the country.  

The Minister of Industry, Trade and Investment, Mr. Niyi Adebayo, told THISDAY that “you are aware that we do not like situation like this because it makes a mockery of the ease of doing business programme of the federal government.

“The view of the ministry is basically that if there is a dispute between the state government and any industry within a state that we have court of law to deal with these issues. We believe that it is very wrong for the state governments to take laws into their own hands to address such situations. The courts are there.

“I understand that there is an original agreement between the state government and Dangote Industries that called for arbitration in the event of a dispute. I believe that all these legal steps should have been taken rather than a state government taking the laws into its own hands. It does not portray Nigeria in good light for sub-nationals to be creating problems for people who have invested money in Nigeria.”

Adebayo added: “You are aware Mr. President just returned from America where he went to address the United Nations general assembly. And on the sideline of that visit to America there was a business summit that was held where Mr. President reached out to foreign investors and was inviting them to come and invest in Nigeria. These foreign investors follow the news on events that are happening in Nigeria and if they see that in Nigeria that a sub-national is treating on of our own biggest investors within Nigeria the way that they have done to Dangote industry in Obajana it does not portend well for us as a country.

“Nobody will be interested to coming to invest in Nigeria in such situation. It is incumbent on us as Nigerians, and as government within Nigeria, especially the sub-nationals to do things in accordance with the law as opposed to just resorting to self-help in troubled times.” 

In the same manner, the Manufacturers Association of Nigeria (MAN), has also condemned the Kogi State’s intransigent attitude. The President of the MAN, Mr. Mansur Ahmed, said that MAN viewed the news of the shutdown of the cement factory as worrisome development and with tremendous concern, adding that it is alarming that a government could take measures to shut down a plant that has been providing jobs and sustaining economic activities on a very large scale over an alleged non-payment of taxes.

Ahmed said: “You can’t use strong arm tactics to shut them down or impose very severe restrictions on their operations simply to force them. This is illegal. And I believe that what has happened will not happen in any normally manage economic environment.”

 Similarly, the Director General of Nigeria Employers’ Consultative Association (NECA), Mr. Adewale Oyerinde, said that Kogi State demonstrated a bad sign to investors against the natural expectation that every state government would make its state attractive to local and foreign investors.

Oyerinde said: “The action of the Kogi state government will only send the wrong signal to investors.

“If there are issues arising from ownership of the cement plant, the most responsible thing that should have been done is to explore conciliatory or legal options rather than the gangster option that was used. That action alone portends danger to our quest for foreign direct investment as a rational investor will be concerned about the security and legal system of any clime.”

The NECA, therefore, “condemn absolutely the steps taken by the state government and hope that reason and sound judgment will prevail. We also urge that the perpetrators of the dastardly act should be prosecuted.

Speaking in the same vein, the LCCI described the attack on the Dangote Cement plant as shocking, disappointing and a reflection of poor handling of investment protection issues in Nigeria.

The Director General of LCCI, Dr. Chinyere Almona, said that the matter could have been handled in a more decent way than resorting to violence.

Almona pointed out that the invasion of the Dangote Cement’s factory by youths that led to the shooting of factory workers is unfortunate, ill-construed, and avoidable.

She said: “We advocate a win-win situation for businesses and the government. We will, therefore, call on all parties to exercise caution and be protective of jobs, assets of production, and government revenues from corporate organisations like Dangote Cement’s factory.

“And where there are infractions, handling such should be in accordance with best practices and the rule of law that protect investors’ rights and human lives.”

The LCCI recommended a meeting of all government agencies connected with the acquisition of the cement plant to resolve any differences thereof.

It said: “We see a role for the Presidential Enabling Business Environment Council (PEBEC), the Bureau of Public Enterprises (BPE), the Nigeria Investment Protection Commission (NIPC), and the Kogi State Government in resolving this issue.”

For now, the National President of Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), Mr. John C. Udeagbala, has sued for a truce. Udeagbala said that “shutting off the factory does not necessarily help the controversial issue of compliance on taxes remittable to the KGSG. Rather, a continual operation of the plant would more likely facilitate a faster resolution of the dispute.

“We thus suggest that the company be reopened as quickly as possible to enable it continue its operation and fulfill its necessary responsibilities, not just on tax but also keep the hundreds of thousands of Nigerians in its direct and indirect employment dutifully engaged and, furthermore, sustain its crucial services, not just to the people & government of Kogi State but Nigeria in general.”