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The Institute of Chartered Economists of Nigeria (ICEN) has said President Muhammadu Buhari’s continued silence on activities of Bureau of Public Enterprise (BPE) over failure of privatisation programmes caused the closure of Aluminum Smelter Company of Nigeria (ALSCON).
It, however, debunked media reports that gas price and Federal Government’s failure to fulfill its promises to (ALSCON) was responsible for the plant’s closure.
Specifically, the institute mentioned insinuations of Federal Government’s inability to bankroll the $0.30 cost per thousand Standard Cubic Feet (mscf) of gas for ALSCON’s operation as the cause of its travails.
In a statement issued in Calabar at the weekend, its South-South Coordinator, Friday Udoh, stated that important variables were disenfranchised in reaching such a conclusion, arguing that even at $0.65 gas price benchmark, the plant profit appeared relatively good.
His words: “Against the Federal Government subsiding gas price, the plant could still operate competitively at prevailing gas price benchmark of $0.65, while not ruling out the need for negotiation of special price regime between the operator and suppliers given the volume of natural gas required for the plant than subsidy.
“Even at that, subsidy can only exist only for a specific time frame or convincing reasons given way for extrinsic adjustments to the price and not open as expected.
“The import substitution industries including ALSCON, Delta Steel Company (DSC), Aladja, among others is not a welcome development to the nation’s economy, security and the future generation.
“ALSCON supposed to have given 1,200 direct and over 10, 000 indirect employment to Nigerians through downstream and raw materials and services industries.”
Udoh noted that the benefits in North East christened a volatile region, especially considering the effect of gas flaring and its consequences on health, atmosphere, desertification and depletion of ozone layer global warming had made the country vulnerable on many fronts.
He added that many Nigerians would have been engaged in sundry economic activities linked directly or indirectly to ALSCON or DSC business chain thereby discouraging such ones from engaging in crime.
Udoh urged President Buhari to intervene and ensure that privatisation issues and execution of various court outcomes relating to ALSCON and other firms were resolved to restore confidence in Nigeria’s judicial system.
He pointed out that going by the loss of over $22.65 billion investments to ALSCON’s closure, it translates to 195,875,237 Nigerians each losing $115.64, and amounts to N41,630.40 at prevailing exchange rate of N136.
The plant stopped operation in 2013 and UC RUSAL’s former spokesman, Smirnova Tatyana, cited unreliable gas supply and ownership uncertainty, as reason for the closure.
