Erisco Foods quits Nigeria, heads for Kenya, three others

Africa’s top tomato paste maker, Chief Eric Umeofia, has set machinery in motion to set up manufacturing concerns in four additional African countries—Kenya, Cameroon, Cote d’Ivoire and Ethiopia.

The venture into four other African countries is a fallout from Umeofia’s decision to close shop in Nigeria.

Umeofia, who confirmed the development to correspondents in Lagos on Sunday, said that his goal was also to have dominant tomato paste manufacturing presence in at least 20 African countries in the near future.

He said that ease of doing business was his attraction in opening shops in the African countries, following his plans to move out of Nigeria because of “the harsh realities of doing business in the country”.

Umeofia had recently announced that he was relocating his key manufacturing plant to China, following what he described as policy inconsistencies now crippling his Nigeria operations.

He said undue favouritism to Lebanese, Indian and Chinese businessmen in the allocation of foreign exchange to import tomato pastes and other items, including frozen fish, has dealt serious blow to his company, Erisco Foods Ltd. and also to other Nigerian companies involved in manufacturing.

Erisco Foods, which has had dominant presence in Liberia and Angola over the years, is listed as Africa’s top tomato paste manufacturer, and the company is the fourth largest of its type in the world, according to records.

But policy inconsistencies and alleged connivance of officials of some key government agencies to deny foreign exchange allocation to indigenous companies in preference for foreigners have left many Nigerian companies struggling or closing shops in recent times.

On October 5, Umeofia announced plans to shut down operations and sack some 1,500 workers at his expansive factory in Oregun, an industrial area of Lagos.

The industrialist said that he decided to relocate to China to produce at cheaper cost and then, sell the goods in Nigeria and other African markets, stressing that he would even make more profit doing so.

He said, “This appears to be the only reasonable thing for me to do since my cries appear to have no meaning for those stifling our operations.”

Umeofia said that he brought his manufacturing concerns worth about $150m in Dubai and Angola to Nigeria in 2009 in what he described as his patriotic zeal to contribute to the growth of Nigeria.

He said, “But dumping of sub-standard tomato pastes from mainly Asian nations has resulted to Erisco Foods losing up to N3.5bn in recent years.

“More so, our products worth about N6bn remain unsold, due to the flooding of our markets with sub-standard tomato pastes from foreign countries.

“If we don’t leave Nigeria now we’ll go bankrupt and I believe that my leaving will open up the environment for government to understand the dilemma facing Nigerian manufacturers like me.”

The Anambra State born industrialist restated that Erisco Foods would also no longer go ahead with its plan to set up a plant to manufacture tractors and other agricultural accessories in northern Nigeria, due to foreign exchange challenges to purchase machinery.

He said, “We had to return the certificate of occupancy for some 2,400 hectares of land, graciously given to us by the Katsina State Government for our tractor manufacturing factory because we’re not able to source Forex to push the venture.”

Umeofia pleaded with President Muhammadu Buhari to use his good offices to look into the activities of top officials of some government agencies conniving with foreigners to short-change Nigeria.

He said, “Some government agencies are impeding and frustrating us in our bid to create jobs for Nigerians. The agencies prefer to favour dubious Chinese, Indian and Lebanese businessmen, making them to create jobs in their countries and depleting Nigeria of jobs.

“Favouring foreigners doing business in Nigeria is counter-productive because no foreigner can love Nigeria better than Nigerians.”

Erisco Food