Wednesday, April 26, 2017

1500 Staff to Lose Jobs, as Erisco Foods Threatens to Shutdown Operations in Nigeria

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Producers of Ric Giko tomato paste, Erisco Foods have threatened to shut down their operations and relocate from Nigeria if the Federal Government does not intervene in its plight.

The management of the company has therefore issued a 30 days ultimatum to the Federal Government of Nigeria, to start rendering the needed support to indigenous manufacturers, or risk having 1500 citizens back in the labour market.

The Chief Executive Officer of Erisco, Chief Eric Umeofia said this while addressing newsmen at the company’s Head Office in Lagos, he said relocating from Nigeria would entail laying off 1500 out of its 2050 staff. He blamed the plights of manufacturers in Nigeria on government agencies including the Central Bank of Nigeria (CBN), Federal Ministry of Industry, Trade and Investment and the National Agency for Food Drug Administration and Control (NAFDAC.
Umeofia said, “It is difficult for indigenous manufacturers to access forex despite CBN’s promise to manufacturers that they will allocate 60 per cent of foreign exchange to them.

“It is unbelievable that for over two months, no forex has been allocated to Erisco Foods whereas the same forex is allocated daily for the importation of finished goods.

“Products that can be easily produced locally like fish head, tomato paste, razor blade are on the forex bids of the various banks.”

He said that the high interest rates charged by commercial banks, importation as well as policy constraints were disincentives to manufacturer’s production in the country.

He said, “The prices of our products are high due to high cost of production and this is in addition that we currently generate our own power.

“We have lost over N3.5bn in our bid to industrialise Nigerian economy and (are) ready to move our production section to another country”.

He said, “We have stock of tomato paste worth over N6bn now and not selling due to dumping and conspiracy against indigenous manufacturers.
However, he added that he decided to move his investment worth over US$150million from Dubai and Angola to Nigeria, where the Government isn’t willing to offer necessary support to indigenous companies.

“We have complained publicly and officially to all the relevant government agencies with loads of evidence, but regrettably nothing has changed till date.

“We will be forced against our patriotic wish to relocate our operations to a country where there is conducive and favourable environment for manufacturing if within 30 days from now nothing significant is done by the government to address these issues.

“We will lay off 1,500 of our employees in the factory, replicate our $150m investment in another country and from there import tomato paste to Nigeria.”

Erisco Foods Limited which has production capacity of 450,000 metric tons of tomato paste annually for 22 brands with over 2,000 workers, is the biggest tomato paste manufacturer in Africa and 4th largest in the world.

However, staff of the company were seen holding a peaceful protest, urging the company not to relocate from Nigeria and asking the Government to come to their aid, as they do not want to lose their jobs.

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