The Chief Executive Officer of Erisco Foods Limited, Chief Eric Umeofia, is full of praise for the Central Bank of Nigeria (CBN) policy that restricted sale of foreign exchange for imported products that are made in Nigeria. In this interview with Bukola Idowu, he recalls how his tomatoes paste manufacturing concern that was almost closing down recalled sacked workers back to production.
Why did you choose to go into the manufacturing of tomato paste?
About 70 per cent of tomatoes cultivated in this nation are wasted every year. When I was in Sokoto, in my early years, there was a farmer, Alhaji Shehu, who used to buy spare parts from me. One time, he bought some parts on credit and promised to pay the following week. But when I got there, he couldn’t pay me. He had taken his tomatoes to the market and on getting there, realised that there was a glut of tomatoes in the market and so, he couldn’t sell and after about four days, the tomatoes got bad.
So, this was one of the reasons why we decided to go into tomato refining. We set up our factory with a capacity to process 250,000 tonnes of tomato paste and we kept running it, although we were losing money every month. We continued just to engage people and get them off the streets. People like to talk about importation, but I prefer manufacturing, and this is what I’m doing.
We ventured into tomato paste production because we wanted to grow our economy and produce quality products. Erisco Foods Limited’s mission is to help the economy; to help Nigeria control our own economy. We deal in the manufacturing of tomato paste, to help stop the importation of fake and substandard tomato paste from China, which is actually damaging both our economy and health. We want to be exporting tomato paste from Nigeria. We have the capacity and all it takes to achieve it and by the grace of God, we are determined to do that.
How has the Central Bank of Nigeria foreign exchange policy impacted business?
About 60 days before the CBN policy, we almost closed down. We could not sell our tomato paste because of the influx of fake imported products. Luckily, the CBN said no product that can be made in Nigeria will have foreign exchange allocation. That was when our business started to rise. Now, we have recalled all the staff we sent away and are employing more. By the time this product saturates the market, Nigerians will realise what we have done. It is about creating a standard and letting everyone work based on that. That way, the economy will be better. We will be able to use our own tomatoes to develop our economy and we will be able to create jobs. It touches my heart to see graduates applying for casual jobs here. The day I almost died was the day I signed to retrench people in this company because of poor sales.
From the Foreign exchange restriction experience, what would be your advice to the government?
I will say the president should ban the importation of tomato paste without wasting time. We can do without the imports. We don’t need it. Rather, the ban will create opportunities for people. The tomato paste industry alone can create jobs for more than one million people in this country, from farmers to processors to marketers. I can assure you that if President Buhari bans the importation of tomato in this country, we will be exporting tomatoes within 18 months. If government gives just 20 percent of its support to tomato paste manufacturers, we’ll become one of the biggest exporters of tomato in the world. The CBN has given us part of the money we need at a reduced rate but that hasn’t solved our problem.
When you want to do backward integration of tomato in this country, you need a minimum of one line to process tomato into concentrate; and it costs $30 to $50 million to do one line. In China, 95 per cent of the factories are owned by government. The same machine that will work 70 days a year, will work just 35 days in China. So, getting the money isn’t easy.
By the time our lines are completed, we are increasing to 450 thousand metric tonnes. We are the number four biggest tomato processing company in the world; only three companies in China are bigger than mine. Very soon, I will become number three, in terms of tonnes. Presently, we have 500 hectares of land in Jigawa to farm tomatoes. The whole northern part of the country can supply Nigerian and have enough to export if the government does the right thing.
How has power inconsistency affected your business?
No country develops without basic infrastructure. From the experience I have here, power is only a problem for small and medium-scale businesses – barbers, welders. When your business is a big one, you can generate your own power. I’ve been off-grid for more than one year. I don’t touch NEPA grid and I’m running well. I even pay cheaper; it reduces my cost because I’m using gas pipelines.
The government should make more pipelines across the country. Then, they should encourage people to go off-grid, pending when we fix the power issue. If they do that in the next six months, over 1,000 megawatts will be free and homes will have more light. Also, the power from gas is cheaper and cleaner for the environment.
Also, I think the federal government should advise the state government to create more industrial zones. Excessive importation is too dangerous for the health and the economy. If Nigeria as a whole decides to make a change from foreign goods to indigenous goods, our foreign reserves will increase by $20 billion within a year. We need foreign investors, but it’s on technology, not on practical goods. Importation should be discouraged entirely.
Buhari is the most experienced president Nigeria has ever produced. We should start made-in-Nigeria campaign, promoting Nigerian goods, both in Nigeria and outside.Then we should make sure that our universities are well-equipped to train genuine people. The Nigerian economy cannot work under theory.
Also, the government should try and make export attractive. For example, I was given a contract by the Angolan government to import cassava during the war. Ocean freight from Nigeria to Angola is six days but from South Africa to Nigeria, it’s about 14 days. Now, the freight charge from Nigeria is $3,000 for 20 feet container. From South Africa, it is $1,050. And the gain is only on freight.
This country has to change. How many pastors have you heard advocating for made-in-Nigeria goods? If they use the effort they use in convincing people to pay tithes to convince them to buy locally made goods, Nigeria will be better. We need all the religious leaders to promote Nigerian goods. If you don’t patronise your own, nobody will patronise you. Every country in this world eats their own food, except Nigerians. Look at Shoprite, 95 percent of goods there are imported from South Africa, they keep exporting Nigerian money. We’ve approached them to sell our tomatoes, but they refused.
They are importing more from South Africa and I think government should do something about these people.
Source : Leadership