…..Proposes N4.5Bn Allocation To Firm In 2024 Fiscal Year
The Minister of Steel Development, Shuaibu Audu, has initiated moves to source N35 billion from financial institutions to revive the moribund Ajaokuta Steel Company.
Audu, in a statement on the latest funding move by the government issued by the ministry’s Chief Information Officer, Tine-Iulun Maureen, was quoted as giving this hint when he received a delegation from Stanbic IBTC Bank, on Tuesday in Abuja.
He explained that the collaboration with financial institutions was to seek the best financing options to re-start the light Steel Mill in Ajaokuta and kick-start iron rod production.
The minister clarified: “It has become imperative to seek funding of about N35bn to enable the re-start of the Light Mill Section of the Ajaokuta Steel Plant for the production of iron rod to achieve the agenda of the current administration to revive Ajaokuta in phases in accordance with its set timelines and benchmark.
“This is in furtherance of achieving its mandate of reviving the steel sector, improving industrialisation in the country, diversifying the economy, providing jobs for the teeming youths and growing the Gross Domestic Product, is collaborating with Financial Institutions, for best financing options to re-start the light Steel Mill in Ajaokuta”, he added
Audu disclosed that the ministry had an existing agreement with the Works Ministry to be off-takers of the rod produced as well as with the Ministry of Defence to build a Military Complex in Ajaokuta, adding that the country has huge opportunities in Ajaokuta and potentially a lot can be achieved from its revitalization.
Earlier in his remarks, the CEO, Stanbic Bank, Wole Adeniyi, who was represented by the Head of Industrials, Debola Seriki, expressed the bank’s willingness to partner the Ministry and requested for further details for the bank’s consideration in the current drive by the government to revive the ailing company.
In addition, the statement indicated that the minister had also met with top management of United Bank of Africa and Voda Infrastructure Management Ltd with a view to ensuring that the needed funds are raised for the immediate take-off of the project for sustainable development of the steel sector.
Meanwhile, the Federal Government has proposed to allocate N4.45 billion to the moribund Ajaokuta Steel Company in the 2024 budget compared to the N3.71 billion allocated to the company in 2023.
In the fiscal 2024 document now before the National Assembly, personnel cost accounts for over 90% of the N4.45 billion budgetary allocation while the balance will be spent on maintenance of power, water and equipment.
Aside from what has been proposed as allocation to the company in the 2024 Appropriation Bill, the Ministry of Steel Development also provided N4 billion for the concession of the steel plant, amongst other budgetary provisions for the steel company.
