President Buhari Ready to Sell Ajaokuta Steel Company before End of Tenure

  

The President Muhammadu Buhari led Federal Government is ready to offer Ajaokuta Steel Company and more of Nigeria's assets for sale soon, under the ongoing privatization programme aimed at raising more money to implement the 2018 deficit based budget. 

The Governor of the Central Bank of Nigeria, Godwin Emefiele disclosed this yesterday while briefing the Nigerian delegation at the end of the International Monetary Fund/World Bank Group meetings in Bali, Indonesia,  confirming that more assets are in the offing.

"I am aware of the situation of Ajaokuta Steel Company of Nigeria. It is also on the cart, first for a total review of the process of privatisation and payment, so that our aluminum sector can eventually come alive.

“I am aware, as a member of the National Council on Privatisation, that more are coming and I believe in due course that the Bureau of Public Enterprise (BPE) will make this available for us.

“It is a choice we have to make. And at this time, the choice for Nigeria is to maintain a stable exchange rate, so that businesses can plan and we don’t create problems in the banking system assets. Naturally, when this happens, it results in weakening of assets, raising of non-performing loans and other wide implications. This is why we will maintain the posture we have and we believe that it is sustainable in the short run,” he said.

A recent audit report meanwhile revealed that a reactivation of the steel company would cost $652 million. 

But Emefiele’s disclosure on Ajaokuta Steel Company elicited mixed reactions, theguardian reports.

According to Prof. Ken Ife, a macroeconomic policy analyst, “The decision to privatise it is a wise one because the complex remains one of the white elephant projects we have in Nigeria. We need to look for a competent investor with a large war chest who can inject the needed funds to revatilise it, so that it can play its role in the country, providing the necessary steel derivatives for the rail, auto, manufacturing, building and construction industries across and beyond the country.”

But a development economist and public analyst, Mr. Odilim Enwegbara, disagreed, saying: “This administration cannot embark on the sale of a key strategic asset like Ajaokuta when it has less than a year to the end of its tenure. It should wait until after election. If it wins again, then it can do that. Besides, the executive lacks the power to sell such a critical national asset without the approval of the legislature. Let them look for funds elsewhere to fund the budget. They cannot sell a key national asset like that to fund one fiscal budget. What happened to the recovered loot they got?”