Chukzyfcb:
when I heard that erisco tomato plant was going to be one of the buggers processing plant in Africa I was happy not until I heard that dangote tomato plant will sooon be coming into existence.
at that moment I knew it wouldn't take long before erisco tomato plant would pack up. only the name dangote can easily defeat any brand name regardless of its size, talk more of his influential power.

jjman2322:
Ok i feel like its time for me to come in with some much needed clarifications..

We are in the manufacturing business (medicine), and we have been hit hard, probably lost around $500,000 this year..
Let me explain:


#1. First of all, NO MACHINERY can be made locally. We use high end machines that cost $100,000's that are only made in China & India.. Has Nigeria even managed to make a TV, talkless of heavy duty machines..

#2. Raw materials for our pharmaceutical production are 100% imported. To make ampicillin capsule you need ampicillin powder. To make amoxicillin capsule, you need amoxicillin powder, etc. These powders are not made in Nigeria. Heck, there are only a few of these factories in the whole world. The factory to make ampicillin would cost tens of millions of dollars, and you wouldnt be able to compete with Chinese prices.

#3. Let me get to how manufacturers source forex. For Machine,raw material imports, you either get funds by :

a. BILL FOR COLLECTION (Where the supplier ships the machine/raw materials to us, and we submit documents to CBN to pay them dollars),
b. LETTER OF CREDIT (Where CBN deducts or naira, and send dollars to the supplier's bank in advance.)

#4. We have dozens of BILLS FOR COLLECTIONS pending across all banks in Nigeria. Basically what this means is that for example a supplier sent a container of ampicillin powder, value of say $250,000, we used the goods and submitted the document to our bank.
Five months later the bank is yet to give us any dollar. We now had to resort to buying black market at N450 for goods that have been used and sold thinking that we were going to get dollar @ 310.

Let me explain this again, lets say for ampicillin capsule you need 1kg of powder per packet. In january you use

1kg of powder X $30/kg = $30. (Multiply this by 310 and you get N9,300). You go ahead and sell this packet in the market for N12,000 for a nice profit of almost N3000. BUT WAIT!!

The official funds never come from your bank, your supplier needs payment so he can continue shipping, otherwise your business closes down. You now go to black market and buy the $30 (@ N450 rate = 13,500). You have just lost N1,500.

Now I just gave you a small example. Multiply this 1kg by 20,000 tons, and now you can see how manufacturers have lost money and closed down. We also had to fire dozens of people just to keep costs down.

What people dont know is that the dollars are NOT enough.. For every $1,000 needed by manufacturers, the CBN has only $100 to give.

Want to know the worst thing? That sample ampicillin packet example I gave you is being imported by some people straight from China. They are importing the finished product, and finished products have no duty.

So basically if you import the raw material as a manufacturer, some of the materials have duty up to 40%, meanwhile if you just have it made in China you bring it in duty free.

Want to know the funniest thing? Many of these importers have connections/bribe top bank officials so that same ampicillin you sold for N13,000 is being sold by N10,000 because they got their funds @ 310.

Please ask any questions if you guys have, but this country has some of the worst policies I've ever seen.

The fact that manufacturers have to buy black market, coupled with the fact its much cheaper to just import the finished product is ridiculous.. More companies are going to close.. We are making essential medicines yet we are almost closing, I can only imagine how other industries are doing..

repogirl:
And Boooohari is encouraging made in Nigeria products.

dabossman:


As usual, we leave the real issues and begin to play this boring PMB vs. GEJ political game.

When have Nigerian banks ever been friendly to SME's be it under OBJ, Year Adua, GEJ or PMB? You are right about one thing though, they would all rather give the forex to the likes of Dangote, Otedola and co. The commercial banks have not helped this gentleman either. Four banks would rather come together to finance Dangote.

Why do our banks continue to play lip service to financing SME's? This is the real issue, not all this PMB-GEJ arguments.

Dutchboy:
Instead of giving HAJJ pilgrim dollars at subsidized rates,Buhari should have given this company that employs 1500 Nigerians the needed Forex.
Dutchboy weeps for the foolishness of Nigeria's leaders.

SharkTank:
If you listen to this man's speeches, you could tell he is super passionate about his work. But the pull him down syndrome of the northern oligarchy sucks

Izonpikin:
has the man made any products except making children and cows...

The guy is so freaking annoying..does he know the dynamics of manufacturing before putting up such stiff laws as regards imports and forex in a time of recession??..

Sirmuel1:



I'm good sir

Chukzyfcb:

well it's not as easy as you pointed out, erisco products are slightly higher than most of the imported tomato brands we have, he is even managing to stay afloat with a higher price margin, if he decides to obtain forex exchange from the banks at a higher rate, it will further dampen his woes he has already accumulated.

bencarson007:
Sometimes I just wonder what Buhari and Osinbanjo the english talkative were thinking when they decided to start saying in Aso Rock.

Is boko-hari and O-sin-banjo trying to buy Nigeria and grow the Naira or close down our economy with bad policies and kill the Naira?

This same useless government practically used our forex to pay for the useless Hajj and useless elections that are still of no benefits to us.

Just give this Chief ERISCO some FX to save the his own quota of nation building and buhari is busy with the Pull Him Down syndrome

Anyways...if 1500 people lose their jobs ...the multiplier effect will affect like 15000 persons...simple economics

Buhari is failing and I am watching...

menix:
Erisco of yesterday
What is wrong with this Buhalia regime, why is he suffering people..
Buhari must be an Endtime soldier, he wants us to starve so that we wont think twice to accept the 666 chip that they would give with a bag of rice..

deenee:
CBN does not give any body dollar. Dollar is now sourced from banks via the interbank market and from autonomous sources (IOCs,exporters remitted funds etc)

On the other hand Dangote being the smart and forward thinking business man that he is funds most of his local FX needs from the cash flows coming from his foreign businesses in other parts of Africa and the world. More so Dangote has intl debt financing from Europe via the EuroBond.

I think the CBN has enough on their plate like trying to shore up our reserves as a sign of confidence for investors.

In as much as I admire Erisco's passion he also has not come clean. This is a man that got single digit loans running into billions from BOI and the CBN during GEJ era to import machinery yet he opted to import tomato paste for quick profit. Nothing was done to him then and I am really amazed that he is screaming blue murder now.

Even other importers source dollar from the black market and pass the cost to the consumers. What these importers also do is ask their suppliers abroad to reduce the quality content of the paste and some really heartless ones even go as far as buying almost expired paste to repackage and sell for us.

Nigerians also need to have a mindset change. We need to start patronizing local goods though slightly expensive.

This is just a phase and I am hopeful that by next year things will abate a bit.

Some wise business men are already taking advantage of this recession to position for the next cycle of economic boom Dangote inclusive. By the time he is done with his refinery, he will without doubt be the largest single private supplier of FX in Nigeria and in West Africa. He will also help reduce about 40 percent of our daily fx needs which is from fuel importation. Now is the time for other oil moguls like Ifeanyi Uba etc to build at least modular refineries but alas they are building tank farms to store imported fuel. In the future these same people will start shouting and screaming blue murder, marginalization, northern agenda, etc etc

I also disagree with Erisco's claim that CBN allocates FX for paste razor etc. This is not true because these items are on the list of 41 banned items and bank even publish in national dailies their daily FX sales schedule.

I think Erisco should first and foremost explain what he did with the BOI single digit loan he got during Gej's era because at this stage I don't think he should still be talking about importation of machinery but rather sourcing for raw materials (tomatoes) which is in abundance locally now

It's just so painful and sad as usual people will just attack PMB CBN Dangote and other innocent people without having a clear picture of what is happening or even the big picture.

God bless Nigeria.

Sainttops:


Of all this business men, Erisco is a person I so much respect cos he has vision and target for his country.
Make una make forex over available for ammm o or else I no go chop food again today if I finish dis amala.

Sibrah:
Imagine just one of those $250k bundle used for election going to Erisco foods.

Arrow24:
am sure you are asking yourself. Who is dis guy. Hope you still remember Vshock

geraob1:


No dey yan dust abeg..

Izonpikin:
eme is not the problem..your president is...

ideology:
the president does not know anything about economy but depends on what he is told. Madam finance says interest should be reduced Emefiele says no

What kind of contradiction is that on public TV

mastro:


I'm confused:

Since the factory is already up and running his ForEx needs should be minimal.

He claims to have N6billion worth of stock, if his "competitors" are importing stock at N500 to the $ then surely his product gets cheaper in real terms.

As a local manufacturer the current state of the Naira should boost his business.

VampireeM:
Some politicians have access to forex from their sitting room at the official rate meanwhile manufacturers are crawling for forex just to import machineries and co.. PMB and his economic team needs to hide their heads in shame.. Just in a year and some months PMB took over power, almost a million Nigerians have lost their jobs due to their archaic policies..
#IncompetentGovt!

VampireeM:
Some politicians have access to forex from their sitting room at the official rate meanwhile manufacturers are crawling for forex just to import machineries and co.. PMB and his economic team needs to hide their heads in shame.. Just in a year and some months PMB took over power, almost a million Nigerians have lost their jobs due to their archaic policies..
#IncompetentGovt!

Yeligray:
I don't know why but i still believe in my country.#d love 2 much#.

Izonpikin:
oboy i tire