My businesses
I’m at present, the Chairman of SOSACO Nig. Ltd; a marketing outfit for various products including, Gino tomato paste. That company also markets Jago gold milk; Gino baked beans, Gino corn, matches, pepper, onions, curry and other brands of Jago milk. SOSACO is an affiliate of Conserveria Africana Ltd with facility in Ota, Ogun State, where we package milk and curry.
My involvement on the board of several companies is my fair contribution to the development of the nation’s economy. I’m also Chairman, S. G. S Inspection Services. We inspect petroleum products such as PMS, AGO and aviation fuel imported into the country. We were, till a year ago, one of the inspection companies responsible for inspecting all goods coming into the country to certify that they are of good quality and affordable to Nigerians. We have an agricultural department and we are working with some agriculture companies in Nigeria rendering value services. We have a motor testing section where we assess the roadworthiness of vehicles. We are teaming up with some state governments to achieve this vision and we have been able to issue certificate of roadworthiness to car owners.
We also render fumigation services through our fumigation department. We use special chemicals to fumigate government offices, premises, warehouses, residences and public facilities. We are into agreement with oil companies to provide them manpower services. As you know, I’m also the Director of Dana Group, which consists of Dana Airline, Aqua Dana, and we have a steel rolling mill in Katsina State, which we bought from the Federal Government of Nigeria many years ago where we produce iron rods. We are agents to Kia Motors and that is our automobile department. We are also agents to Fiat and Dana Pharmaceuticals located in Mina, Niger State.
Mercedes Benz brand ambassador
We are into automobiles. Like I said earlier, we are the sole agents of Kia Motors and Fiat in Nigeria. So, I have been involved in car business for a long time, hence, the reason I was made Mercedes Benz Brand Ambassador in Nigeria. I’m also the Chairman of Limex Global Services Nig. Ltd, manufacturer of Bimbo detergent. Our products have won us world acclaim as the company is doing well so much that it has brought glory to the country. At present, we are producing Bimbo bar soap.
Bell Oil and Gas
I was the Chairman of Bell Oil and Gas, which was established 13 years ago. We are one of the major service companies in the oil and gas industry in the country today. I was the chairman up till two years ago when I stepped down and handed over to one of the directors and shareholder. I still remain on the board of Bell Oil and Gas.
Route out of economic recession
I have friends who are supposedly experts in economics and few years ago I asked their opinions on how the country’s economy can be stable. Unfortunately, none of them could come up with a solution that is satisfactory not to only me but Nigerians. Even now that we are in deeper economic mess, I still could not find experts that can get us out of this situation. You hear of all sorts of committees and economic teams as well as seminars yet none has proffered solutions to the country’s economic problem. Some experts whose names I won’t mention have come up with “solutions” that did not work.
We must bear in mind that there is global economic recession, which is affecting us. But our present situation is the result of mismanagement and lack of direction on the part of those who administered the economy in the past. I know that the present administration is doing everything possible to get us out of the doldrums but we must be patient. There is no magic to it because there is no way we can see a dramatic change within one year. A lot of damage has been done, which we all know and the present government said, when it took over, that it met an empty treasury. Unfortunately, it came when international oil price plummeted. Few years ago, we sold crude oil for $100 per barrel. Today, it is hovering around $40 per barrel. When you consider our pattern of consumption and the fact that we import finished products and raw materials, you’ll appreciate our predicament.
Local production of tomato paste
As a matter of fact, no company in Nigeria today is producing what we call triple concentrate from fresh tomatoes. There is none and there are reasons for that. It is unfair that some people misinform the government and the public. Of course, we have fresh tomatoes you can buy and produce your meal with, but the fact is that this product is seasonal. It lasts for may be three months and you can get fresh tomatoes during the season, after which it is no more fresh. So, how do you get tomatoes? The only way you can get tomatoes is to get it when in season and preserve it when it is out of season. There are factors that militate against this. So, when people tell you that there is a lot of wastage of tomatoes when they are thrown out, the reason is that tomatoes have not been preserved by local producers because when you grow tomatoes, you don’t allow all of them to ripen at the same time. If you grow all at the same time, what it means is that you have to harvest them at the same time. If you do, then you must preserve them for use when tomato is out of season.
To preserve tomatoes, you must convert them into what is called triple concentrate, which means you have to crush them and take the flip out of the back and juice, then you crush. If properly preserved, it will last for two years because it has a life span of two years if you do. If I give you statistics of tomato consumption and production, you will realise that it is in short supply. The only way we can satiate our demand is conserve it into triple concentrate.
Studies have shown that to convert fresh tomatoes into paste you have to harvest them from your farm and take them to the factory. But when your factory is 60kms outside the farm, one begins to run into trouble because it is too far. That is why Dangote sited his facility right in his tomato farm so that people can easily pick tomatoes and carry them straight to the gate of the factory. So, if somebody tells you that he is bringing fresh tomatoes from Jigawa State to crush in Lagos, he is lying to you. So many people have sold this dummy to the government that they have a farm in Sokoto or Kano. They claim that they have a facility in Lagos and thereby collected huge sums of money from government that they can produce tomato paste locally, but at the end they could not produce in the country. Have you seen where they offload tomatoes from trailers? They bring them in baskets and some spend four to five days to transport tomatoes from Sokoto to Lagos. The tomatoes you take to the factory must be red and fresh but because they put them in baskets on top of each other, they end up squeezed. They are picked from the ground and for it to be packaged it must go through rigorous washing. The question is, if tomatoes come from that far and are broken up and rotten, what happens? The dirty water that is used to wash them permeates them and that’s not good enough for human consumption.
In line with your question, I know Dangote has a plant and one of them produces 140,000 tonnes a day. I also know of some companies that lay claim that their capacities are higher than that of Dangote but for the Dangote plant to reach full capacity, it requires 40 trailers of tomatoes for a day’s production. So, can you imagine somebody bringing 40 trailers of tomatoes everyday from the growing areas to Lagos? I’m giving you a conservative figure because the mischievous plant I hear exists hardly has a capacity higher than Dangote.
Let’s use Dangote facility as an example. If Dangote requires 40 trucks of tomatoes to crush everyday, what it means is that the other facility in Lagos will require more to meet its capacity. Assuming it is producing less than its maximum capacity, the company will need 40 trailers to be able to maximise the facility, if it requires 40 trailers a day, and I want to know where the facility is in Lagos. Where in Lagos can you line 40 trailers every single day for the production period of three or four months a year?
Ban on import of 41 items
When government bans certain items, it must have looked into it critically before taking such decision. I’m not in support of bans because I’m an advocate of free trade. I’m sure Nigeria signed some world agreements on free trade. So, government must have considered all these before it took the decision. As far as we are concerned, the products I’m talking about are not banned. It is just that there is foreign exchange restriction for importation of items.
Factors limiting production
There have been a lot of talks about banning imported rice. I was at the Katsina State Investment Forum earlier in the year and heard the Central Bank Governor talked about rice production in the North. He supported that programme and I heard it was successful. Other states have taken a cue from Katsina in rice production. I know some friends who have gone into rice farming and I’m convinced that with enough rainfall this year, we will have enough food next year. The major problem we face as a nation is preservation. I can keep rice for one year if properly preserved but it’s not like the perishables. After two or three days they perish.
Enabling environment for mechanised farming
Mechanised farming has not been successful in Nigeria for several reasons. You won’t blame government for that because some years ago, I visited a few states and I saw a good number of tractors in various states to the extent one will think that all the tractors manufactured abroad have been shipped to Nigeria. Some farmers were taught how to use these tractors but the factor militating against that is lack of maintenance of the tractors. For instance, you take a tractor that’s supposed to last 10 years and give it to a farmer; after three months, because of lack of maintenance, the farmer abandons the tractor and resorts to manual labour. Some farmers have not accepted the mechanised way of farming.
Other factors include inability of the farmers to afford the tractors and lack of education, which is hindering our farmers from embracing modern farming techniques. I was at a seminar some weeks ago and the Minister of Agriculture, Chief Audu Ogbeh, said a particular kind of fertiliser is a killer. It does not only destroy the crop but the soil itself. It does not only give you the yield, but it destroys the soil. I told you we have agriculture department in S. G. S and a laboratory in South Africa. We can come to your farm and take a soil sample and tell you the kind of fertiliser to use and the right quantity to apply. We can also guarantee you the yield because technology has advanced to that stage. So, there has to be a reorientation of our farmers. We have to involve experts to do soil analysis that can tell you the quantity of fertiliser to apply. We must depart from the past whereby the federal, state and local governments will invite farmers to come and take fertiliser whether it is good for the soil or not.
Effect of naira depreciation on business
Naira depreciation has affected my business markedly. We commissioned a facility in Accra, Ghana, in 2015, because we noticed that there was a huge demand of our products much more before the dollar shortage. Those goods no longer end up in Nigeria because customers could no longer get products from us hence they go somewhere else. Some of them go to Ghana to get it. We had a case some years back when a product of one of our companies had issues and we had to shut down to reorganise for 10 months. During that period, there was an influx of these products into the country as some companies in French speaking African countries started to produce them and sold to us because we were not producing. We saw other people with the products but we said we don’t know anything about it hence we noticed that the inscriptions on those products are written in French. We inquired and realised that there was increase in the demand of the products from French speaking countries and in Nigeria.
Companies across board operating in Nigeria are facing a challenge sourcing foreign exchange. Part of our vision is to commission a facility that can employ 1000 people in Isolo area of Lagos. So far, we have acquired the place and work has commenced and we are waiting for arrival of machineries for installation, but that has to be put on hold.
Is government monetary policy defective?
I’m not saying the policy is wrong. What is wrong with monetary policy when foreign exchange is scarce? That is just the truth. The monetary policy revolves around availability of funds and government doesn’t have the money. Our overhead in running the country is huge. How much is the daily expense of government? It runs into billions and the source of revenue is the sale of oil. How much are we selling now considering the destructiveness of militants in the Niger Delta? The price of oil is down from $120 per barrel some years back to $40. Past administrations should have saved for the rainy day, instead, the money was squandered hence we ran into debts. Somebody has to pay back because the revenue is not enough to meet our requirement. Companies went as far as demanding 40 per cent of their foreign exchange requirement to keep their facilities functioning, but they could not get it. What happens if you have a factory and you need spare parts to produce the items you sell and that factory is down? What do you do? A lot of factories are experiencing that now.
Way out
If I have the answer, I probably would have been given national award for proffering solution on how we could get out of this quagmire. The answer given by government, the facts, figures and necessary data show that within some months things will improve. We that are involved in manufacturing hope things will improve so that factories can pick up again. As I speak to you, we are shedding load, because if you are not producing you will not have money to pay staff.
Removal of Minister of Finance, Kemi Adeosun and counterpart in Budgeting and National Planning, Sen. Ita Enang
I said when we started that there is no magic that can get us out of recession within one year. People expect to see change immediately, but it takes time for whatever policies put in place to manifest. The ministers have bosses and if Buhari is not satisfied with their performance based on set goals he has given them, he can sack them. Buhari is somebody I know, he will not hesitate to show them the way out, if they fail to perform. You hear some people blame some ministers for the recession; in fact, they say all sorts of things. I would have expected suggestions instead of this blame game on how we can get out of this economic mess we found ourselves. I know people who were in government but when they had the opportunity, they failed. It is not enough just to sit outside and criticise government. I know Buhari has good intention to get Nigeria out of recession.