‘Erisco Foods exit will worsen unemployment in Nigeria’

Eric Umeofia is the president and chief executive officer of Erisco Foods Limited, Nigeria’s largest tomato processor with 450,000 metric tons capacity. Umeofia, last Wednesday, threatened to shut down production and move his Lagos plant to another country, following foreign exchange frustrations and lack of government support for indigenous manufacturers. In this interview with ODINAKA ANUDU, the tomato paste maker says his determination to quit Nigeria mirrors the obstacles on the way of local manufacturers in the country.   

It was widely reported that you are shutting down production in one month. Why do you want to close down the biggest tomato processing plant at this wobbly point in the life of the Nigerian economy?

Well, we brought our investment worth over $150 million from Angola and the United Arab Emirates into Nigeria to help grow our economy. However, our patriotism and determination have not been appreciated. We are being worked against by institutions that should protect us. The Central Bank of Nigeria (CBN) refused to give us foreign exchange to import machinery, spare parts and raw materials. Unfortunately, the same CBN approved an intervention loan and foreign exchange to foreign companies to import the same finished tomato pastes and other items such as frozen fish that we do not need in this country. It may interest you to know that fish is among the 41 items banned by the CBN.  Recently, $15.1 million was allocated to an Indian company in one bidding at the exchange rate of N280/$, while we run our factory with FOREX sourced from the parallel market at the exchange rate of N450/$.  The National Agency for Food and Drug Administration and Control (NAFDAC) conducted tests and confirmed that 91.1 percent of tomato pastes imported into Nigeria are fake, but these products are in the market today. I have tomato pastes worth over N6 billion in my warehouses because I cannot sell them. Indians and Lebanese bring in substandard tomato pastes and sell cheaper. But indigenous manufacturers like us produce and sell at higher prices because there is no support for us. By global standards, if a product is 70 percent substandard, you can ban. Here we spend N125 billion importing foods. If those in government think they have a right to intimidate me, I also have a right to move out and go to another country.

The Ministry of Industry, Trade and Investment has also not been helpful. I have approached the minister in charge of this ministry twice but he shunned me. I wrote a letter intimating on the challenges we have regarding dumping, but he has since refused to see me. Theory does not change the economy. What changes it is practice.

Recently, the CBN directed that 60 percent of FX be given to manufacturers. Is it that you have been excluded from this arrangement or didn’t you make any effort to tap into it?

Right now, my application has been in my bank for weeks but nothing has come out of it. Innoson has not got. Other genuine manufacturers cannot also get. It is the Indians, the Lebanese and the multinationals that are getting, making them overnight billionaires. Genuine manufacturers suffer but importers get and expand their import capacities.

So what specific things can the government do to prevent you from relocating to another country?

I want to see a ban on all the items we can produce here. Let them bring together 10 to 20 individuals, task them on moving the economy forward and you will see them make progress. Government should make FOREX available to genuine manufacturers. Government should also give us a specific ministry for industry with someone who has an experience in this area. The Ministry of Industry, Trade and Investment we have today is more interested in trade than industry. Trade and industry are often opposite to each other.

Is there no way we can encourage the production of concentrates in Nigeria so as to reduce the constant pressure for FOREX?

We want FOREX not just to import concentrates, but also to import better and more efficient machines for production. We also need to import tin plates for tomato packaging.  There is no where these tin plates are being manufactured in Nigeria at the moment.  But some of the people I am talking about import finished tomato pastes. We have the idea but there are many constraints here. If I go to another country, it will be easier for me. If I have half of what I have in Nigeria in a country like Niger, the country’s president will be passing through my company every morning before he goes to the office to ensure my business does not shut down.

But you are complaining about the CBN that recently gave you N2 billion. What happened along the line?

I saw them as sincere when they banned 41 items. But later on, they turned back against us.  So should you kill me because you gave me N2 billion? The same thing you cannot do for me, why do you do it for foreigners? If there is no food in the house, everybody will go and sleep. But why do you tell your children there is no food but bring out plates of food when you see strangers? How will people see you?

I hope you will still stay if the government decides to intervene in your case.

It depends on the type of intervention you are talking about. I have made up my mind. Have you been watching TVs? I have spent more money than any of the MDAs on promoting made-in-Nigeria products. Our plan is to shut down the tomato paste section in one month. After two months, we will move our machines to another country that wants us to come. All countries now have unemployment challenge. I have businesses outside Nigeria, so I know. We are very few in this country that tasted other economies before returning to Nigeria.  Pakistans will be glad to have us. So will other countries. I didn’t make my money here. I made it abroad and brought it home to show my loyalty to my country. I wanted to help grow this economy. We are the first and only company till date that is using fresh and dry tomatoes obtained from Nigerian farmers to produce tomato pastes. We have spent N4 billion on buying all their excess tomatoes that ought to have wasted. I have confidence in the incorruptible President Buhari, but people under him do a lot of unpalatable things. Our exit from Nigeria will trigger change in government policies. We will sack up to 1500 workers, and you know the impact of this on unemployment. This, I know for sure. I am creating jobs that government cannot create. This country has not done anything for me than take from me. So why should I continue to suffer for the people I want to help?  I have lost N3.6 billion so far, but every day government tells me to wait for something they can easily do for me. I want to move away so that these government agencies will be happy. The posterity will be happy that there was a man called Eric Umeofia who did all his best but was not allowed to succeed.

Can you just list some of the things you want to see in the Nigerian manufacturing sector generally, not just in your business?

We want FOREX given to genuine manufacturers. Government should find out who the genuine manufacturers are. Some still get FOREX to import finished goods. India, China, Lebanon, the USA, Britain and other countries shut their doors to what their local manufacturers could produce. They grew their economies and then relaxed the policy when they found out they were strong enough.  If we can’t produce tomato pastes, can we now produce aircraft? Government should fund genuine manufacturers, set a target for them and you will see them grow the economy. If I am supported, in two or three years, I will generate enough FOREX to run my factory.

So how do we ensure the message of patronising made-in-Nigeria products is assimilated by Nigerians?

If I am supported, prices of my products will be competitive. We need more action than talk now. If I get 20 to 40 percent support, I will crash the price of tomatoes and foreigners will appreciate the need to do the right thing. There has to be a policy that will make MDAs patronise made-in-Nigeria goods.