Post #154

⚙️ Nigeria’s Unrealized Potential Why billion-dollar domestic processing plants never really started In Nigeria, more than $8 billion has been spent over 50 years on the Ajaokuta steel project and the plant still has no commercial steel output. That fact captures a common pattern of Nigerian resource processing factories built in the 1980s - 2000s, which hardly moved from “commissioned” to “working.” ⏩How could it be that Nigeria had already created a huge industrial potential, but for some reason has never taken advantage of it? What kind of industry Nigeria built in the 1980-1990s: Steel and Aluminium: 🔸 Ajaokuta Steel Company — idle since 1994 to present; 🔸ALSCON (Aluminium Smelter) — largely dormant since 2007 with brief revival attempts; 🔸National Ore Mining Company — effectively moribund for many years after 2008; 🔸Delta Steel Company — mostly idle until a private restart effort after 2018; 🔸Jos Steel Rolling Company — moribund by the 2000s; 🔸Osogbo Steel Rolling Mill — plant left idle since 2005; 🔸Katsina Steel Rolling Mill — moribund by mid-2000s and sold in 2006 after closures; Oil: 🔸Warri Refining & Petrochemical Company — repeated stoppages, largely idle from late 2010s onward; 🔸Port Harcourt Refining Company — prolonged shutdowns, largely idle from 2019 onward; 🔸Kaduna Refining & Petrochemical Company — prolonged shutdowns and very low utilisation, especially from late 2010s onward. Paper and Pulp: 🔸Iwopin Pulp & Paper — stopped by 1996–1998 and idle thereafter; 🔸 Newsprint Manufacturing Company — shut in 1994, long-term dormancy followed; Sugar: 🔸Savannah Sugar Company — stoppages through the 1990s–2000s, later privatized. ⏩All this accounts for almost $90 billion in investments. But why so many plants never truly started? 🔸Liberal reforms in 1985-1990s (aka "Structural Adjustment") facilitated imports of foreign end products, making newly built domestic factories unprofitable. 🔸 The government failed to maintain policy consistency and predictability. In 1988-1993 and from 1999 onwards the government embarked on privatization, with concessions and privatizations often becoming court fights. Years of arbitration froze assets and scared off operators. 🔸 Poor planning: too often project designs relied mainly on imported spares, chemicals, and equipment, which made them idle each time when foreign exchange dried up nationwide. 🔸Factory projects also often required that additional infrastructure be built, without which they could not operate due to the lack of existing facilities. When subcontractors or the government failed, enterprises were deprived of gas and power, rail links, raw materials. The government has tried to fix the situation through new partnerships, further privatization, sector and individual reactivation plans. This, however did not fix fuel, feedstock, and poor logistics. Many of the factories that have been staying idle since the 1990s are now technologically obsolete and covered with rust - once you touch them, you will hear a lot of noise. Nigeria’s “commissioned-but-never-launched” factories were not accidents. They were outcomes of projects built without reliable inputs, power, and logistics, which dropped into volatile policy weather and weak governance. This needs to be taken into account if the country plans to move from resource extraction to domestic value-addition. #PolicyReview#Nigeria Devils Below