The Nigerian Ministry of Steel Development has unveiled an ambitious privatization strategy for the long-dormant Ajaokuta Steel Company, marking a significant shift in the nation's industrial policy. Minister Shuaibu Abubakar Audu announced this transformative initiative on November 20, 2024, emphasizing the critical role of private investment in revitalizing this sleeping industrial giant.
The Ajaokuta Steel Complex, established in 1979, stands as a testament to Nigeria's industrial aspirations, with an initial design capacity of 1.3 million metric tons of steel annually. Despite its impressive potential, the facility has remained inactive for over four decades, hampered by a complex web of mismanagement, corruption, and legal disputes that prevented it from producing a single steel sheet since its inception.
In a significant development, the Nigerian government has formalized a partnership with Tyazhpromexport, the Russian consortium that originally constructed the facility. This collaboration, sealed through a Memorandum of Understanding in September 2024, aims to conduct a comprehensive technical audit and rehabilitation of both the Ajaokuta Steel Complex and the National Iron Ore Mining Company. The partnership represents a crucial step toward modernizing the facility and ensuring its operational viability.
The economic implications of this privatization initiative are substantial. Currently, Nigeria spends over $4 billion annually on steel imports, creating a significant drain on foreign exchange reserves. A fully operational Ajaokuta Steel Complex could dramatically reduce this dependency while potentially generating over 500,000 direct and indirect employment opportunities. This aligns with President Bola Tinubu's economic vision of expanding Nigeria's GDP beyond the $1 trillion mark by 2030.
Minister Audu has emphasized the government's commitment to creating an investment-friendly environment that will attract credible private sector participants. The privatization strategy includes comprehensive technical assessments, infrastructure upgrades, and the establishment of clear operational frameworks to ensure sustainable production once the facility becomes operational.
The revival plan includes modernizing the plant's technology, upgrading transportation infrastructure, and ensuring reliable power supply. These improvements are essential for meeting contemporary steel production standards and achieving competitive operational efficiency in the global market. The government has also outlined strict timelines and performance metrics for potential investors to ensure accountability and progress.
The privatization initiative has garnered support from various stakeholders, including local industry experts, international investors, and development partners. This broad-based support suggests a strong foundation for the successful transformation of the Ajaokuta Steel Complex into a productive industrial asset that could catalyze Nigeria's manufacturing sector growth.
