In the last 44 years, industrialisation in most northern states of Nigeria has experienced a gradual but steady decline with hundreds of private and public companies established by successive governments having closed shop,leadership report.
LEADERSHIP investigation in 17 of the 19 states in the region showed that the hyper-industrialisation drive initiated by the late premier of the region, Sir Ahmadu Bello, and sustained by the military administrators/governors under the Gen Yakubu Gowon regime, has not been properly handled by the successive administrations.
Key industry players, who spoke with LEADERSHIP on the mass closure of companies in the North, said the privatisation policy of former
President Olusegun Obasanjo, which most of the states embraced, did not work out as the new owners of the privatised companies failed to invest enough capital to keep the company afloat.
They also accused the new owners of poor management.
The situation, according to them, was compounded by infrastructure decay, harsh operational environment, insecurity, and policy inconsistency.
LEADERSHIP’s findings revealed that in 12 of the 19 northern states, 84 companies have so far closed shop. The figure could be higher as no data was presented from Kano State, which is the industrial hub of the region.
A breakdown of the affected states showed that 12 companies folded up in Kwara State, Nasarawa, 6, Borno, 8, Kaduna, 20, Plateau, 7, Benue, 5, Bauchi, 6, Sokoto,10, Nige, 5, Yob, 2, and Adamawa, 3.
The states without official figures from the Ministries of Trade, Commerce and Investment and chambers of commerce are Kano, Kebbi, Taraba, Jigawa, Gombe, Zamfara and Katsina.
In Katsina State, the officials simply said 90 percent of the companies in the state had become moribund while their counterparts in Kebbi said there were 30 registered companies in the state but only few are functioning. Kebbi officials could only name three companies in the rice and cassava processing sub-sector that are operational.
LEADERSHIP’s findings showed that firms that had closed in the state long before the nation’s new political dispensation which commenced in 1999 included the Kwara Textiles, Kwara Match Company (MATCO), Tate and Lyle Sugar Company, Kwara Papers Converter, all owned by Kwara State government.
The privately owned companies that have closed include Global Soap Detergent, Ilorin, Coca Cola Bottling Plant, Ilorin, Double Cola Company, Ilorin, Okin Biscuits, Offa and Ijagbo Breweries.
The federal government-owned Nigeria Sugar Company, Bacita, Nigerian Paper Mill, Jebba, and the Nigerian Yeast and Alcoholic Manufacturing Company (NIYAMCO) had been comatose because of the government’s privatisation policy during the tenure of Obasanjo.
In Nasarawa State, a few private and state government-owned industries have gone under due largely to unfavourable business climate.
Among key private companies that operated and wound up at some point include Delta Prospectors Limited with Ultramodern Processing Plant located on Jos Road, Lafia, the state capital.
The company which established its plant in the state in 1995 deals majorly in barites and supplies same to oil and gas companies.
It was doing well until things took a drastic turn following the new democratic dispensation heralded by the Obasanjo administration.
LEADERSHIP observed that its premises has remained shut for many years.
In May 2021, the Nigerian Content Development and Monitoring Board (NCDMB) listed the company among the four firms approved for the supply of Barites required for any drilling project or contract in the Nigerian oil and gas industry.
The board urged all project promoters in the Nigerian oil and gas industry to ensure that Barites required for any project shall be procured only from the approved Nigerian Barites processing companies with Category A Nigerian Content Equipment Certificate (NCEC).
However, despite the development, the company’s plant in the state has remained shut. Another private company that has similarly shut down is Oil Chem Nigeria Limited, which had its office on Makurdi Road in Lafia, the state capital.
The company, which commenced operations in 2001, provides drilling and completion fluids engineering services to the national, independent and international oil and gas companies. Seven years later, however, it ceased operation and shut down its facility.
Aside from the private concerns, a few state government-owned companies which were thriving at conception, also suffered similar fate and had to be leased out to interested private operators.
They include Fertiliser Blending Plants, located in Lafia and Keffi, Keffi local government area of the state; Nasarawa Beef Factory Masaka, in Karu local government area; Nasarawa Sacks Factory Akwanga, established in 2002, and Nas Spring Water Company Ltd, Lafia, established in 2001 respectively.
Our correspondent reports that all the affected state government-owned companies had to be leased out for seven to 10 years to remain afloat.
The sole administrator, Borno State Chamber of Commerce, Industries, Mines and Agriculture (BOCCIMA), Alhaji Ahmed Ashemi, said over 10,000 jobs had been lost in the state due closure of companies over harsh operating environment and insurgency.
Ashemi added that industrial concerns that are capable of offering employment to 20 or 30 people are all down, and only small and medium enterprises like bakery, tailoring, sachet water and bottled water makers, among others, are existing.
The BOCCIMA boss said prior to the Boko Haram insurgency, the major industrial concerns in Borno State had almost gone down, revealing that the Maiduguri Flour Mills around Umarari area of Maiduguri is only operating at skeletal level.
The president of Katsina State Chamber of Commerce, Abba Yusuf, said industries and small businesses in the state and across the nation are on the verge of total collapse.
He decried the economic and security challenges gradually crippling business activities and the individuals’ purchasing power.
He cited Mekera Hotel, which has over 36 workers on its payroll, for saying that for the first time in many years, it can stay in a day without a single guest, yet it constantly maintains security, foodstuff and staff, including the purchase of diesel at N800 per litre daily.
He urged the government to as a matter of urgency intervene by assisting business owners by working on the economic status and security of the nation.
In Kaduna State, Kaduna Chamber of Commerce and Industry (KADCIMA) has said over 20 industries have closed shop in the state due to inadequate power supply, inconsistency of government policies, lack of infrastructure as well as insecurity.
Speaking with LEADERSHIP on the closure of industries in the state, KADCIMA director-general, Usman Saulawa, also identified influx of foreign materials into the country as one of the reasons that affected the industries.
He, however, commended the administration of former Kaduna state governor, Malam Nasir El-Rufai, for bringing in some foreign and local investors to establish industries despite the insecurity at that time.
Saulawa named some of the industries that shut down at present and others 20 years ago in the state. They include Starlex Manufacturers, Kaduna machine tools, Kaduna Ware and Nails, Zaria Industries, Kaduna aluminum and Kaduna textile industries
In Plateau, one of the companies that is still standing even though operating below full capacity on the Industrial Layout, Old Airport
Road, Jos, is NASCO Group of Companies.
The company, which started operations in Jos in 1963, is one of the largest employers of labour in the north, but it has suffered much adversity.
The major market of NASCO was northern Nigeria.
According to a staff-member who did not want his name mentioned because he was not authorised to speak, they used to record up to 60 to 70 percent of sales in the north, but following the crisis in the zone, sales have dropped to as low as 30 percent.
Also, the Jos International Breweries (JIB) Plc is the former producer of Rock and Class Lager beer. The company also produced Royal Malt a soft drink for its consumers, especially for the people of North Central, North East and part of Kaduna State.
JIB was established in 1975 by the Joseph Gomwalk administration with BARC Farm as part of its subsidiary.
During the operation of the brewery, which got its raw materials mostly from the BARC farm, massive revenue was generated leading to the establishment of subsidiary companies such as Pioneer Milling Company.
The BARC Farm alone employed more than 4,000 workers through direct or indirect means. Successive administrations have made efforts to revamp the moribund company but to no avail.
Similarly, the Jos Steel Rolling Mill, also established in 1980 by Alhaji Shehu Shagari administration, today remains comatose.
For several years, the Naraguta Leather Works in Naraguta village, near Jos, Plateau State gained recognition as one of the leading tanning companies in the country. But today, it’s a shadow of itself.
Da Bulus Dareng, a former president of Plateau Chambers of Commerce, Mines and Agriculture (PLACCIMA), told our correspondent that nobody is talking of economic development now because of the insecurity everywhere.
In the same vein, the executive secretary, Manufacturer Association of Nigeria (MAN) in charge of North Central and North East, Egwilo Augustine, said one of their biggest challenges is insecurity and cost of production which, he said, is very high because of the removal of fuel subsidy.
In Benue State, the major companies driving the state’s
economy in the past were the Otukpo Burnt Bricks Company, Taraku Mills Company, Benue Cement (now Dangote Cement) and Benue Plastic Industry (Ben-King) which were privatized. Apart from the Dangote Cement, all other industries in the state have closed shop.
Our correspondent gathered that Olam, producer of Olam Rice which was hitherto producing in the state, has relocated to Nasarawa State due to multiple taxation.
Again, the Wannune Tomato Factory in Tarka LGA built by former Governor George Akume, has not functioned for once.
The director-general of the Bauchi State Chamber of Commerce Industries Mines and Agriculture (BACCIMA) Sani Tahir said that most private owned companies in the state had folded up due to poor record keeping.
The director-general BACCIMA said this in an interview with our in Bauchi.
Tahir told our correspondent that most industrialists operate businesses with improper record keeping which inhibits their capacity to distinguish between working capital and personal income.
“Similarly, there is a general lack of good management skills among industrialists in Bauchi,” he said.
The director-general said another factor responsible for the collapse of companies in Bauchi is citing the firms in isolated areas where stable power supply is apparently lacking thus becoming unable to sustain operation on power generating sets.
However, LEADERSHIP reports that to resuscitate the affected companies, Bauchi State government announced privatisation of six of its companies last year.
The privatised firms include Bauchi Meat Factory, Bauchi Furniture Company, Wikki Hotels and Tours, Zaranda Hotel, Bauchi State Fertiliser Blending Company and Galambi Cattle Ranch.
A lecturer with the Department of Banking and Finance, Federal Polytechnic, Bauchi, Uwais Muhammad said to change the ugly narrative of collapse of companies, the government must make an effort to educate more business owners, provide adequate security and capital.
He said business owners lack ideas as to how to access capital and grants from the government, adding that most of them do not have the requisite managerial skills to operate the business.
In Kebbi State, investigation by LEADERSHIP shows that the state started with few companies after its creation on August 17, 1991. There were only two companies at the time, Plastic Industry located at Bulasa industrial area of Birnin Kebbi metropolis owned by Alhaji Na’amo Abubakar Birnin Kebbi, an industrialist and former rector of The Polytechnic, Birnin Kebbi, now Waziri Umaru Federal Polytechnic, and a cassava processing company at Kalgo under Kalgo local government area of the state, owned by Alhaji Noma Kalgo, a retired civil servant with Kebbi local government service commission.
Between 2003 and 2015, some companies were also established such as
Labana Rice Mills at Sani Abacha bye pass in Birnin Kebbi metropolis,
Lolo Rice Mills Company at Kamba in Dandi LGA, and Bakaba Rice Mills in
Argungu.
The permanent secretary, Ministry of Commerce, and Industry, Abubakar
Kigo Dakingari, said there were over 30 registered functional and
non -functional companies in the state.
He described the functional as rice millers, and plastic and cassava
processing companies as non-functioning due to the exorbitant
charges of power supplied by KEADCO and mismanagement by some staff of
the companies.
Also, an industrialist, Abubakar Na’amo in Birnin Kebbi said the
lukewarm attitude by government contributed to closure of companies
in the state as well as mismanagement and exorbitant charges by power
company.
In Adamawa State, Mubi Burnt Bricks Industry, Gombi Chalk Company, and
Fertiliser Blending Company, all owned by the state government, have
packed up due to harsh economic operating environment
in the state.
The permanent secretary of the Ministry of Investment, Trade and
Commerce, Mrs Rifkatu Gwandi, confirmed the closure of the firms to
LEADERSHIP in Yola.
Gwandi said the Mubi Burnt Bricks Industry stopped production in the
last 20 years, even before the inception of insurgency in the state.
The president of the state Chamber of Commerce, Mines, Industry and
Agriculture, Mr Maliki Daniel, urged the state government to inject
funds to revive the moribund companies.
In Sokoto State, the major companies which had contributed to the
economy are now in limbo with no plan to revive them soon.
Some of the companies, government and privately-owned, that provided
employment and means of livelihood to thousands of Sokoto residents
way back in the 80s that are now moribund, are Labella Ceramics, Haske
Rice Mill, Sokoto Leather Industry, Wurno Plastic Limited, Sokoto
Furniture Company and Wurno Construction Materials.
Others are Zaki Bottling Company, Sokoto Beverages Limited, Sokoto
Food Industry, Sokoto Match Industry, Bafarawa Flour Mill, Sokoto Foam
Limited, Sokoto Dairies Limited and Shamrock Fertilizer Company.
Some of them became comatose due to the economic nosedive Nigeria
began experiencing in the 1980s, while a majority of the companies became
moribund due largely to mismanagement.
An economist, Abubakar Dingyadi, who recalled the good old days of the
listed companies, noted that they contributed to the booming economy
of Sokoto.
On what to do, to revive the moribund companies, Dingyadi posited
that “the state government, in conformity with the modern trend,
should resuscitate the companies and attract private investors to
wholly run their affairs.
In Niger State, most of the respondents said bandit attacks have affected industries and other businesses in the state, notable among them are the dairy industries meant to feed off the Bobi Grazing Reserve.
The companies that were supposed to establish factories but backed
down because of insecurity were WAMCO (Peak Milk), Chi Limited
(Chivita), NEON, Irish Diary, and Hail Consortium
Others are Crystal Talc and Kalgara, both in Kalgara, while some
small-scale processing firms were said to have been affected because of
banditry.
In Gombe State, some companies established to process some cash crops
to boost the revenues of the state are now gone moribund.
Some of the major companies include Manto Processing Company in Kumo,
Akko local government area commissioned by a former President Olusegun
Obasanjo to produce mango juice and tomato paste.
LEADERSHIP gathered that Gombe was ranked, in recent times, the best in
the ease of doing business due to its amenities, security, safety, and
business orientation, yet, there are no adequate industries in the
state to justify its ranking as the best place for business in the
nation.
Perhaps, to attract investors to site industries and companies in the
state, Governor Inuwa Yahaya designated huge hectares of land and
established an industrial park along Deba road for the construction of
companies in the state.
Residents have also advocated the revamping of the Mango Juice and
Tomato Paste Manufacturing Company in Kumo so as to create jobs for
the citizens.
Plans are on top gear by the Yobe State government towards
resuscitating the adversely destroyed Dofarga Spring Water Company and
the Gujba Fertiliser Blending Plant, the permanent secretary of the
Ministry of Commerce, Industry and Tourism, Alhaji Mohammed Inuwa
Gulani has said.
The Dofarga Spring Water Company and the Gujba Fertiliser Blending
Plant are located in Gulani and Gujba local government areas that were
hitherto under the control of Boko Haram insurgents before liberation
by the military in 2015.
The Dofarga Water factory was one of the best bottle spring water
before the Boko Haram insurgency providing hundreds and direct and
indirect jobs to the people while the Gujba Blending Plant was stocked
with a lot of raw materials before its destruction by the Boko Haram
insurgents LEADERSHIP learnt.
Yobe has been among the states suffering from a lack of private
companies, hence all the factories were established by the state government
to generate employment opportunities for the citizens
In Jigawa state, few existing companies in the state are The Lee Group of Company
producing shoes, Mats, Room Carpets and other plastic goods, Majestic
Dairy, Danmodi Rice Mills, Jigawa Rice Mills and CGC Marbles Company
and are all functioning now.
However there was an attempt by the state to establish a sugar factory
but it failed. There are however some industries that are under
construction now such as Dangote Rice Mills, and 10,000-hectare
Gagarawa Sugar plantation.
Taraba State, from investigation, is among the least industrialised
states in the North. The virtual absence of industries in the state
has led to non-existence of the chamber of commerce where stakeholders
meet to advance the sector’s cause.
Despite the ease of doing business policy, business owners in Kogi
state have continued to frown at the increasing tax they pay to the
government at all levels.
Manufacturing companies in Kogi state are said to be paying hundreds
of millions of naira to both the state and federal government in tax.
This alone would have forced so many organisations out of business.
According to business owners in the state, the revenue generation
system is not friendly, but the payment system gives them relief coupled
with the fact that the ease of doing business provides them better
opportunities to make profit and remain in business.
A member of the Manufacturers Association of Nigeria revealed that
while existing companies are growing, other investors are finding
their way into Kogi state because of availability of raw materials and
other factors that they consider as a plus to the business environment.
A professor of Economics at the University of Ilorin,
AbdulGafar Ijaya, has said improved infrastructure, especially power,
is required to revive some of the moribund industries in the North and
Nigeria as a whole.
He also stressed the urgent need for the government to address the
problem of insecurity which, he noted, is preventing people from working
in the rural areas where raw materials for production are sourced.
Ijaya added, “On how to revive these industries and attract more
businessmen to the North, I think it will be very important to address
the issues of infrastructure, power especially, and the government is
already trying to do something about that. The Aladja-Ajaokuta-Abuja pipeline, a gas pipeline that is under
construction, is trying to see how they can transport gas through the
pipeline to the North, Kaduna and Kano, especially.
An economist, Dauda Danliman, advocated massive investment in
infrastructure as a leeway to sustaining the industries.
He also suggested drastic reform in the power sector to forestall
epileptic energy supply and consequent reduction in cost of production
as another measure to ensure growth.
He equally called for an end to over dependence on foreign goods and regulation of the same, necessary waivers for local manufacturers, and access to funding facilities as some of the ways forward.
