The BUA Group responded to claims by Dangote Industries Limited and Flower Mills of Nigeria that its sugar refinery “poses a threat” to Nigeria’s local sugar industry.
Aliko Dangote, President of Dangote Industries Limited and John Coumantaros, President of Flour Mills of Nigeria, wrote a joint letter to the Minister of Industry, Trade and Investment accusing the BUA refinery in the Bund Free Trade Zone, Port Harcourt, Rivers State, of undermining the national master Sugar Plan (NSMP).
The NSMP is a roadmap for sugar production that was introduced in 2013 in order to achieve self-sufficiency in sugar production and foreign exchange savings in the import of sugar and ethanol.
Responding to a request from the Ministry of Trade for a petition on the petition, Abdul Samad Rabiu, chairman of the BUA group, said her project is managed under the Nigeria Export Zone Processing Authority Act (NEPZA) and the Free Zone approved by President Muhammadu Buhari.
Rabiu said Dangote and Coumantaros were calling for the issue “the authority of the president’s power and the diligence of the trade ministry”.
“Therefore, we see this as an insult to the president’s powers and an attempt to undermine Nigeria and its institutions, as well as to distort competition, in order to acquire a monopoly that keeps the country under ransom,” he said.
RARE ARTICLE LETTER
Dangote and Coumantaros, in a letter dated January 28, 2021 and addressed to Minister Niyi Adebayou, claim that the Port Harcourt sugar refinery was built with the “intention of undermining the NSMP”.
They both prayed to the minister to investigate the amount of raw sugar imported by the BUA sugar refinery and “to impose an appropriate penalty in terms of customs duties of 60 percent and 10 percent taxes on the company.”
They called for the fair and disciplinary application of the NSMP by the Nigerian Sugar Development Council (NSDC) – the regulator.
“Publicly available information suggests that BUA International, one of the players in the sugar industry, has commissioned a sugar factory in Port Harcourt, Rivers State. With the new refinery, the processing capacity in the country exceeds from 2.75 million metric tons to 3.4 million metric tons per year, or from 170 percent over capacity compared to last year’s import quota to over 210 percent of capacity, “the letter reads.
“This investment in the Port Harcourt refinery was obviously made with the intention of undermining the NSMP. We are particularly surprised by the audacity because we believe that the choice of location and the promotional campaign behind the investment were deliberately created to provoke public sentiment and oppose the Federal Republic of Nigeria to its people. “
They also asked the ministry to ensure that no additional quota is allocated for very high polarity raw sugar (VHP) or refined sugar for the Port Harcourt refinery for production in the local market.
THEY ARE ‘FINISHERS’
In his response of 11 February 2021, Rabiu said that it is a well-known fact “in Nigeria and anywhere in the world that, wherever Dangote operates in any sector or company, it seeks to direct competition in any necessary way” and “This the scenario is being played again in this case. “
He wrote: “However, it is strange that his current co-conspirator John Coumantaros, a Greek-American citizen, was once a victim of Dangote. If we recall, he had similar problems with the hands of his conspirator, which then led to his arrest, along with his aging father, by the EFCC.
“They were detained for more than a week because he decided to do so [do] cement plant through UNICEM. In the end, Coumantaros had to sell his business to save himself. This is also a matter of public records. They only act amicably as friends because of their interest in squeezing out competition and creating a monopoly for themselves. “
AS A JACKET, AS A LEKKI?
Rabiu said that according to the NEPZA law, companies are allowed to process and, if they wish, sell 100 percent of their production in Nigeria with the payment of customs duties based on current raw material tariffs.
“In fact, Aliko Dangote of Dangote Industries, who is one of the complainants who cites and attacks this approval, also applied for and received the same approval for his Lekki refinery project, Lagos State, where he currently enjoys the benefit of being in the NEPZ.” , he wrote.
The company said the Port Harcourt sugar refinery is mostly for export, not for the Nigerian market.
BUA said it is doing everything possible to ensure that its backward integration program (BIP) is ongoing through a Lafiagi Sugar project, which includes 20,000 hectares of sugar, a 10,000-ton sugar factory, a 200,000-tpa sugar refinery, an ethanol factory of 20 million liters and a 35 MW Bagasse plant.
He said both Dangote and Coumantaros are not happy with Lafiagi BIP which sees the level of investment there as well as the Port Harcourt sugar refinery.
The refinery employs over 1,000 Nigerians with more than $ 250 million spent on the project.
“In fact, both players already have 80% of raw sugar allocation (Dangote-55%, Flour Mill-25%), with no consensual BIP investments that really justify such an allocation.”
BUA said that it will continue to fulfill the obligations of the NSMP and the backward integration program.