Nigeria had three functional paper mills in the 1980s and 1990s, but only one is working today.
The three paper mills included Nigeria Paper Mill (NPM)Limited located in Jebba, Kwara State; Nigerian Newsprint Manufacturing Company (NNMC)Limited, Oku-Iboku, Akwa Ibom State; and Nigerian National Paper Manufacturing Company (NNPMC) Limited in Ogun State.
Today, only the mill at Iwopin is working at about 10 percent capacity. Studies show that the country loses N180 billion annually from non-performance of these paper mills.
Hussain Doko Ibrahim, director-general, Raw Materials Research and Development Council (RMRDC), said the cost implication of non-performance of NPM in 2006, 2007 and 2008 to the Nigerian economy annually was N7.8 billion, which only reduced to N6.85 billion in 2009, resulting in a four-year deficit turnover of N30.25 billion.
Ibrahim noted that the cost implication of the comatose state of NNMC between 2006 and 2009 to the economy was N18.76 billion, adding that within the four years considered, the deficit turnover to the economy equalled N74.8 billion.
Each year, newspaper houses and publishing firms import newsprints and papers running into billions of naira despite that the country is blessed with luscious trees whose barks can be used for paper production. Nigeria spends N50 billion on the import of papers annually, statistics from the RMRDC says.
The history of Nigeria’s paper and pulp industry has been a tale of woes. In the 1960s and 1970s, the federal government established the three paper mills for the purpose of producing bond paper. The NPM produced 40,480 tons of kraft paper by 1985 and 42,960 in 1986, representing 62.3 percent and 66.17 percent capacity utilisation respectively.
The NNMC performed well and operated profitably, as the volume of newsprint in the company spiked from 28,927 tons in 1989 to 37,581 tons in 1990.
Owing to the optimal utilisation of the mill, importation of newsprint fell drastically to 17.5 percent in 1986 and 12.5 percent in 1987. But this was short-lived as the third mill, NNPMC, was abandoned in 1983 when it was at nearly 85 percent completion. Till the time it was shut down, it did not produce up to five percent capacity, checks show.
Privatisation put the paper mills in the hands of investors who were accused of being unserious.
“The co-investor that bought the Nigeria Paper Mill (NPM) Limited did not buy it to help Nigeria,” said Samson Ololade Ogundele, ex-senior manager, Nigeria Paper Mill Limited, Jebba, Kwara State in Lagos, said at a stakeholders’ forum in Lagos.
“I know it was valued at about N30 billion in Nigeria as at 1995, but this same mill was given to the investor at N334 million in 2008. The aim of the government in handing over the mill was to create jobs and improve the economy. The majority of Nigerians working in Nigeria Paper Mill –both junior and senior—are all casual,” Ogundele disclosed, adding that the Federal Government must re-visit the privatisation in spite of the fact that it is the only paper mill working at the moment.
In March 2016, the federal government handed over the Iwopin Paper Mill in Ogun to the core investor, Beulah Technical Company Limited. According to Abimbola Ogunwusi and Peter Onwualu, director and former director-general at RMRDC respectively, the integrated pulp and paper mills established in Nigeria were privatised as a result of lack of adequate funds to import requisite raw materials and generally because of their non-performance.
The major problems facing Nigerian paper mills have remained unsolved. The mills depend on imported long fibre pulp and chemicals. Also, the local market is still saturated with cheap Indian papers, which experts say will hurt local manufacturers whose production cost is much high.
More so, technology transfer is low in the industry.
Proffering a solution to the woes of the industry, Oluwadare Oluwafemi, a professor in the department of agriculture and forestry, University of Ibadan, identified the inability to source long fibre trees as one key reason for the non-performance of the mills.
Oluwafemi called on the government to support planting of long fibres to provide cheap raw materials for firms.
He urged the government to increase allocation to research institutes to enable them come up with better species of pulp.
He also wants Nigeria to establish a pulp and paper institute for easy technology and skills transfer and save the country from these humongous losses.
“It is unfortunate that 90 percent of papers used in Nigeria are imported,” Oluwafemi said, while presenting a paper entitled, ‘Long Fibre Pulp Production in Nigeria: Prospects and Challenges’, calling for the reversal of the privatisation process which he said was faulty.
Other experts want a reversal of privatisation, but this will come with legal tussles and huge obligations to the government.
