Nigeria signs MoU with Russian conglomerate to rehabilitate Ajaokuta Steel Complex

NIGERIA'S federal government has signed a memorandum of understanding (MoU) with Russian conglomerate Messrs Tyazhpromexport to rehabilitate the Ajaokuta Steel Complex and the National Iron Ore Mining Company (Niomco).

In an agreement just entered into in Moscow. steel development minister Shuaibu Audu, signed the MoU on behalf of Nigeria. Back in 1979, the Ajaokuta Integrated Steel Complex, was originally developed by Messrs Tyazhpromexport  to establish a metallurgical process plant alongside an engineering complex and various auxiliary facilities.

Since then, however, the facility, which has remained moribund for decades, is yet to produce a single sheet of steel due to corruption and legal bottlenecks. Ajaokuta is meant to generate important upstream and downstream industrial and economic activities that are critical to the diversification of the Nigerian economy and help convert it into an industrial one.

Upon assuming office last year, Mr Audu assured Nigerians that the steel complex will begin production and end Nigeria's current steel importation. Messrs Tyazhpromexport experts have visited the steel plant and the iron ore mining site at Itakpe in August, leading to the invitation for the MoU’s signing.

Two other companies, Novostal M and Proforce Manufacturing, described as members of Tyazhpromexport’s consortium, were also involved in the MoU. While in Russia, the Nigerian delegation also inspected the facilities of Messrs Novostal M, located in Balakovo in the Saratov region.

Mr Audu said: “The revival of the steel sector will also reduce importation of steel products into Nigeria, which is estimated at over $4bn annually and will help save scarce foreign exchange.”

According to the Russian partners, the full implementation of the MoU would facilitate the revival of the Ajaokuta plant and Niomco and could create over 500,000 direct and indirect jobs for Nigerians. They also believe it will increase the size of the Nigerian economy by billions of dollars, thus contributing immensely to President Bola Tinubu’s desire to grow the economy to over $1tn by 2030.