ABUJA: There can be no better testimonial of the Federal Government’s bungling of the privatisation of its three paper manufacturing companies than the recent report that Nigeria currently spends an annual N500 billion to import paper products. Several years after the privatisation of the companies, it is easily a story of grand betrayal in terms of the expectations of swift turnaround and the grand dream of backward integration said to have supplied rationale to the much hyped process of sale.
With none of the three specialised paper mills anywhere near the dreams as conceived by their founding fathers, not only is the nation served the short end of the stick as far as the expectations of performance go, nearly everything that could go wrong appears to have gone terribly wrong.
We start with the oldest of them all – the Nigerian Paper Mill, Jebba, which opened shop in 1969 with an initial production capacity of 12,000 tonnes of apex per annum. Aside its best years of 1985 when it rolled out 40,480 metric tonnes of paper, representing 62.3% of its installed capacity, and 1986 when it took this up to 42,960 tonnes – representing 66.17% capacity utilisation, its story has been one of steady decline until 1996 when it finally shut its gates after output plumbed to 2.5 percent.
Sold to MINL Ltd, an Indian company in June 2006, if we expected the company to take it to a new level, it has confined it to the level of waste paper recycling – a far cry from its initial dream as an integrated paper manufacturing entity drawing strength from backward integration. If the company ever intends to explore the use of primary fibre derived locally in its backward integration drive; that remains to be seen.
But then, the story of Iwopin Pulp and Paper Company Limited, Iwopin, Ogun State, established in 1976 is even more tragic. The company, designed to produce 68,000 metric tonnes of various grades of finished fine writing, printing and cultural papers, was planned to produce fully bleached pulp. Up till the time it was shut down in 1998, the mill never produced up to five percent of its installed capacity. This was despite attaining 85% completion.
First, it was sold to an indigenous company – Noxieme Technologies Ltd – in December 2006; only last year, there were reports that the company has found a new core investor – Beulah Technical Company Limited. Yet, till date, there has been no tangible activity at the sprawling complex.
The Nigerian Newsprint Manufacturing Company, Oku Iboku, is no different. The mill, with an installed capacity of 100,000 metric tonnes of newsprint per annum took off with a promise to save the nation billions of naira spent to import newsprint – the main raw material used in the newspaper industry. After turning out 28,927 metric tonnes in 1989 and 37,581 tonnes the following year, the company would suffer precipitous decline in the 90s due to scarcity of funds to refurbish the equipment and purchase raw materials. In the end, it was sold to Negris Limited. It has been in coma since.
Presently, the newspaper industry relies almost exclusively on imported newsprint at great costs to the foreign exchange reserves.
After investing so much in the entities, Nigeria obviously deserves more than the companies would seem in any position to offer. A good way to start is for the Federal Government to find out what went wrong. How come none of the companies has been able to affect the fortunes of the entities in any fundamental way? Were there no timelines, no performance clauses in the sales agreements? For how long will the country continue to depend on India and other Asian countries for its paper needs? There ought to be something that the Federal Government can do to redress the unacceptable situation. And the time to act is now.
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