By Adewale Sanyaolu
The Lubricant Producers Association of Nigeria (LUPAN) has warned that the new policy to grant permits for the Importation of lubricants could cripple Nigeria’s lubricant manufacturing industry, threaten over 200,000 jobs and derail years of industrial progress.
Speaking during a recent presentation to the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) in Abuja, LUPAN Executive Secretary, Mr. Emeka Obidike, described the policy as a looming catastrophe that could easily shutter most local blending plants already operating at below 30 per cent of their installed capacity.
He lamented that despite the sector’s robust capacity to exceed national demand and support exports, local production is being stifled by the unchecked influx of imported finished lubricants, leaving plants grossly underutilised.
He said: “The hue and cry of our association has always been the advancement of the indigenous lubricant market in tune with the trends, drive and demands of the 21st century global market which is at par in quality, diversity and versatility with global frontrunners.
“The policy will kill the growth recorded in the last few years in the sector, and set back the lubricant policy of the federal government, which is currently being perfected by the Federal Ministry of Industry Trade and Investment in the lubricant Industry.
The Implementation will discourage more investment opportunities in the lubricant Industry”, he explained.
He noted that the mandate of every organ of Government is to implement policies and programmes that will promote the economic agenda of President Bola Tinubu and not one that would work against, especially in the area of Backward Integration Policy for the manufacturing sector.
He further warned that the consequences of the policy would be far reaching as there will be an increase in the breakdown of machineries all over the country due to the influx of low-quality lubricant imported into the country, with recycled oils and non additives.
According to him, the new policy will ultimately create serious compromise, similar to what the sector is currently experiencing in the indiscriminate granting of basic oil import permit licenses, especially to those without lubricant plants.
The policy, he added, will create a favourable market advantage for imported lubes because many factors which affect indigenous producers such as; power, multiple taxation, forex fluctuation, infrastructures, banks high interest aren’t applicable to imported products because they have a conducive operating environment
“Many companies might slip into bankruptcy and insolvency because of the huge loss to be experienced. Every country protects their indigenous businesses against external competitors and I believe the same is expected from your esteemed agency rather than kill the same.
“No country can achieve true greatness with over dependence on foreign products. We are most disheartened and disillusioned by the fact that the government agency which should be at the forefront of every effort and scheme to bring about a more conducive environment for business to thrive, are the ones eagerly and arbitrarily formulating policies and regulations, that would undermine and frustrate Government efforts to revamp the economy.
“We, thus, reiterate our appeal to the Authority Chief Executive of NMDPRA to use your good office to facilitate the cessation of the import permit requirement for all imported lubricants into the country.
“We affirm with depth, sincerity and humility, our belief in the administrative capacity of your office to proffer an effective solution to the aforementioned dilemma which capable of threatening the existence of our industry, and effectively reverse the situation as we are on our part pledge our unalloyed commitment to your agency, its goals and vision’’, he added.