FG Plans N35 Billion Local Financing to Revitalize Ajaokuta Steel Plant
In a strategic move to rejuvenate the Ajaokuta Light Steel mill, the Federal Government is set to raise approximately N35 billion through local financing. This announcement was made by the Minister of Steel Development, Mr. Shuaibu Audu, following a crucial meeting with President Bola Tinubu in Abuja on Thursday.
The primary focus of the Ajaokuta Steel mill will be the production of iron rods, aligning with the government’s road construction initiative. This initiative aims to create thousands of job opportunities across the country, contributing to economic growth.
Mr. Audu revealed that the Minister of Works, Sen. David Umahi, has provided assurance through his ministry that there will be off-takers for the iron rods produced. This commitment is part of the Renewed Hope Agenda, with plans to construct approximately 30,000 kilometers of roads in Nigeria, requiring an estimated 7 million metric tonnes of iron rods. Ajaokuta Steel Plant has the potential to produce about 400,000 tonnes of these iron rods, subject to the successful restart of the steel plant.
Approval has been granted by President Bola Tinubu to raise funds locally, and discussions with local financiers are currently underway. The finalization of these arrangements is anticipated in the coming weeks to ensure a prompt commencement of the project.
Military Hardware Manufacturing and Foreign Investment
In a joint meeting with the President and the Minister of Defence, Muhammed Badaru, Minister Audu highlighted discussions surrounding the Ajaokuta Steel plant’s potential to manufacture military hardware. A Chinese firm has expressed substantial commitment to this project, with discussions initiated during the G20 summit in India.
Mr. Audu revealed that the Chinese company is willing to invest $5 billion in the steel sector of the economy, emphasizing a strong commitment to the development of Ajaokuta Steel Plant.
Ministerial Committee for Investment Oversight
To ensure the successful realization of this significant investment, President Bola Tinubu has approved the establishment of a ministerial committee. This committee will oversee the implementation of the investment and include key stakeholders from various government ministries, such as Finance, Trade and Investments, Defence, Solid Minerals, and Steel Development. The establishment of this committee reflects the government’s dedication to fostering economic growth and revitalizing the steel sector in Nigeria.