Nigeria spends $3.5 billion yearly on steel importation

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Nigeria spends over $3.5 billion yearly on the importation of steel products, Mines and Steel Development Minister Dr Kayode Fayemi has said.

He told reporters after a town hall meeting with players in the industry in Lagos yesterday that as a result of the huge spending on steel importation, the Federal Government resolved to make the Ajaokuta Steel Company work by privatising. This, said Dr Fayemi, will save the nation the huge foreign exchange and job export.

As a demonstration of the government’s seriousness, Fayemi said the expression of interest (EoI) by investors, who want to acquire the steel company, will open in six months time.

“The steel industry still remains the backbone of industrialisation in any country. Any country that wants to make headway in manufacturing and industrialisation must pay particular attention to steel development.

“In Nigeria, we utilise about 7 million metric tons of steel on annual basis and we produce less than 3million tons and from scrap mainly. And even the scrap is being depleted now; so we run the risk of depending almost solely on importation. We spend over $3.5 billion importing steel products into Nigeria annually; you can see the opportunity cost and the importance of ensuring that Ajaokuta comes on stream. That’s why government has been determined to ensure that the litigation around it was resolved and we can put it to those who have the technical knowledge and financial capacity to intervene and bring it to life in a manner that liquid steel can be produced from our own iron ore endowment in the country. Then the liquid steel will be made available to rolling mills across the length and breadth of Nigeria to use for direct steel production rather than depending on scrap metals.

“The timeline for the Expression of Interest (EoI) will happen in the next six months. I’m not saying we are bringing it to life in the next six month but the process of those who have an interest in coming to put Ajaokuta into practical use within the period I mentioned. We have had a number of players both local and foreign that have shown interest.

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