Reps worries over $4.5b annual expenditure on steel importation

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ABUJA, JULY 18, 2017 – The Chairman, House Committee on Steel, Mr Lawal Muhammadu Idrisu has decried the expenditure of $4.5 billion annually on the importation basic metals and aluminum products annually.

Speaking during an investigative hearing on the “lack of patronage on Nigerian Companies in the Provision of Steel products, the outrageous taxes and Duties imposed on steel products manufacturers , he explained that the aforementioned amount is for 25 million tonnes of steel export.

He asserted that the development of the steel sector will ensure wealth creation for the citizens, conservation of foreign exchange arising from the use of locally made products as well as increased internally generated revenue.

Calling on the Federal government to consider the original builders of Ajakouta steel plant in the proposed negotiations for the completion, reactivation and operation of the project, he explained that the capital flight on steel and iron accessories has huge impact on the economy.

He said the public hearing would provide the enabling environment to formulate the necessary legislation that will empower the country, create wealth, jobs for the citizens, preserve the foreign exchange and lead to economic well being.

In his submission, Engr. Also Abdulahhi, Director Steel of the Ministry of Mines and Steel Development, also decried the deacy in the steel industry, saying that despite the country’s ranking in iron ore reserves in the world, exploitation and steel production remain very low.

He added: “There are over 20 steel rolling mills in the country fed largely by steel scrap. The main inhibitors to growth of the steel industry are poor infrastructure and lack of cheap, affordable and accessible finance, limited transport infrastructure to production sites and lack of cheap, uninterrupted power” he said.

“Lack of patronage of local steel manufacturers by international contractors is a major concern to the Ministry, but this may likely be due to the inability of the local steel manufacturers to produce different steel profiles eg. structural steel products as most of them deal in iron rod” Abdullahi stated.

The ministry recommended zero duty for plant equipment and machinery, tax holidays, pioneer status and special tariif incentives as some of the strategies to be adopted by government for the development of the steel sector.

The Speaker of the House of Representative, Hon. Yakubu Dogara who was represented by the Majority Whip Mr Yakubu Umar Barde noted that the iron and steel sector is still underdeveloped. He proposed that the original developers of Ajaokuta Iron and Steel Company, designed to serve as the biggest integrated sreel company in West Africa should be contacted to provide a lead for the company to begin production.

Barde noted that the failure in the steel sector accounts for the influx of substandard iron and steel products into the country, adding that about N2 bn worth of cables were recently confiscated by customs as a result of the failure in the steel sector.

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