CHINESE INVESTORS ABANDON COCOA PRODUCTS INDUSTRY IN EDE- 9th Aug 2020, 07:43am
Factory Turned To Store For COVID-19 Relief Items
Efforts Ongoing To Put It Back To Use – Govt
By Ismaeel Uthman
The Cocoa Products Industry Nigeria Limited in Ede, (SKYRUN COCOA FACTORY) has suspended its operations.
OSUN DEFENDER gathered that the set of Chinese running the company abandoned it in 2018 without informing the state government until 2020 when a letter was sent to Governor Adegboyega Oyetola, informing him of the suspension of their operations.
Currently, the facilities at the company are being used as stores for COVID-19 relief items donated to the State Government of Osun.
It would be recalled that the company was revived by the Ogbeni Rauf Aregbesola administration after 15-years of being in moribund state.
In a letter directed to the Governor, the management of the factory stated that the company was facing operational challenges, which forced the company to go on temporary shutdown.
The letter reads: “The company and its parent company have been facing a series of operational challenges since September 2018, which forced the company to bring back its staff in Nigeria and temporarily shut down the SKYRUN COCOA FACTORY. The specific reasons are explained below.
“Firstly, it’s because of the trade war between China and the US. The parent company’s main customers are American companies and 90% of its products are exported to the United States. Due to the trade war initiated by the US government against China round after round, the tariffs on products exported to the US increased sharply, which directly led to the unsalable products of the parent company. With a large number of goods in the warehouse, it seriously affected the normal operation of the company.
“As a result, the parent company decided to suspend production activities at the plant in Nigeria. When the trade war situation between China and the US eases and the tariff is lower, the parent company will continue to come to Nigeria to resume processing activities. Of course, the company has to get through all these difficulties caused by this first.
“Secondly, due to the recent outbreak of the new Coronavirus epidemic situation in China, the Chinese government requires enterprises not to rest their normal production activities within a certain period in order to reduce the flow of people in case causing a wider range of infections.
“Therefore, our parent company and chocolate manufacturers as well as other enterprises are also in the state of halt in production. We estimated that the deadline is going to be longer than expected, further exacerbating the company’s difficult situation and further delaying the resumption of production at the SKYRUN COCOA FACTORY.”
Efforts Ongoing to Put It Back To Use – Govt
The Commissioner for Commerce, Industry and Cooperatives, Mr. Henry Olanipekun expressed government’s displeasure on the attitude of the management of the company, saying that it has violated the agreement between it and the government.
Olanipekun said: “The Chinese have abandoned the place and we have initiated a process of calling off the agreement between the company and the state government. They have run afoul of the agreement.
“If they have abandoned the place for two years without any form of communication with the government, it means they don’t know what they are doing or they are no longer interested in running the place. As far as we are concerned, they have abandoned the joint venture.
“We are taking appropriate steps to normalise the activities at the company, whether they will come back to do the needful or they hands-off, so that we can make profitable usage of the place. We are working seriously on getting the place back to work.”
Expatriates Involved Are Raiders, Shoddy In Dealings – Board Chairman
In his reaction, the Chairman of the Board of Directors of the company, Dr. Adewale Adeeyo described the current status of the company as unfortunate and a reflection of the shady and dishonest attitude of the Chinese people managing the company.
Adeeyo, in an interview with OSUN DEFENDER yesterday stated: “The Chinese are very dishonest businessmen. They came and didn’t bring enough money and materials, and they were very shady in their dealings. They just disappeared once without notice. Members of the Board of Directors earned nothing for the three years that we were there.
“They promised that we would be taken to China for a meeting and we would be given our entitlements but that never happened. They did not tell us anything, they just vanished. They are unreasonable businessmen. They don’t want to do anything properly.
“They promised to invest over $200million and I think they invested $6 million dollars in the company. They brought a little piece of equipment to upgrade what we had on ground, they worked a little bit, trying to make cocoa butter and stopped. They just left. They operated between 2014 and 2018.”
When OSUN DEFENDER visited the company yesterday, the environment was bushy and deserted, except for two guards at the place.
It was gathered that the Chinese investors abandoned the company to venture into gold mining operations at Itagunmodi in Atakunmosa West Local Government area of the state.
Some of the workers with the company, who spoke with the medium under condition of anonymity, said the Chinese investors were producing cocoa butter, cocoa powder, cake and cocoa liquor before they abandoned the place.
According to the workers, the investors stopped operations early in 2019 for gold mining and eventually left the company in January this year.
They disclosed that about 120 of them were working in the company before it was shut down.
When asked if there was shortage of materials for production, the workers said there were enough materials, saying that the investors exported the remaining cocoa in the company to China.