• Wednesday, February 21, 2024
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Agro-processors identify reasons for poor investment climate


Stakeholders in the agro-allied sub-sector of agribusiness in Edo State have attributed lack of infrastructure, multiple taxation and finance as some of the challenges militating against investment climate in the state.

The stakeholders include Peter Idaewor, managing director of Idaewor Farms Limited, at Iraokhor, processor of various cassava flours in Etsako Central, and Aisibor Ehizogie, sales manager of Zeenab Foods, processor of soya, vegetable and palm oil.

The duo, in separate exclusive interview in Benin City, note that investment in the agro-allied sub sector seemed not encouraging in the state due to the insensitivity of tiers of government to grow the sector.

Peter Idaewor adds that processing sector in the state could only be boosted if government at all levels are economically inclined to develop the economics of the state by investing in the agricultural sector.

Idaewor, who listed major problems confronting his establishment to include electricity and water, notes that N10 million is needed to address the two challenges.

According to him, agro-processing is delicate, cumbersome, but with enabling environment the challenges could be surmounted. “In my factory for example, I have never used electricity from the Power Holding Company of Nigeria (PHCN) for one day for six years, and all the processing I have ever done was by personal generating plant. Because the public electricity does not always have the correct voltages and all the electric motors use three phases. So, we are forced to rely on generating our power to be able to be in the business of agro-processing,” he says.

Speaking further, he says “water is also our major challenge in the business. Unfortunately, for me and the Edo North Senatorial District where the water table is about 1,000 feet, I have made two attempts to sink borehole but all the attempts failed. Quotation for borehole for a company based in Port Harcourt, Rivers State is N9 million, while the Edo State government is sinking borehole in the area for N7 million.”

He says that “if an individual SME like me spend N7 million to sink borehole, is that not the spelling of death for the business? So, at the moment I buy water. In the factory I used 33,000 litres of water every week. We spend about N12,000 to N15,000 weekly on water. Multiply it by the number of weeks and get your figures.

“Diesel is very expensive. We buy 30 litres for about N6,000 and we keep our machineries running for 24 hours. Soon we will be using kerosene for our N8.5 million new fly drier because it uses kerosene. And it use about 20 litres per hours. So, 20 litres per hours for 10 hours you can imagine how much we are going to spend if you know the price of kerosene. All these put together are disheartening and can discouraged any lily-livered person.

“Government should look at the possibility of letting micro-processors get electricity equipment like transformer so that they can have dedicated transformer. But to solve the immediate problems of water and electricity cannot go beyond N10 million if well managed, but we have a plan to source for N40 million to blow the business open within the next two years,” he says.

Several applications have been written to the state government through the Edo State Rapid Response Agency (RRA) for assistance, he says, noting that all efforts were to no avail.

He says therefore that governments should consider assisting the existing small, medium enterprises (SMEs) with the necessary facilities to be able to address their various challenges, especially in the area of finance, water and electricity.

“The state government through the relevant ministries, departments, and agencies should identify serious SMEs that have made or making impact and then identified their problems. I have named two major challenges confronting my factory, which are electricity and water. Edo State government has the facilities to sink borehole no matter the depth.

“We are not saying that the government should do everything for us but when there are challenges an individual cannot meet, which can contribute to the generation of employment and internally generated revenue, at least I think the government should look at it more seriously instead of a one way policy that government does not sink borehole for companies but only for communities,” he says.

On his part, Aisibor Ehizogie of Zeenab Foods, advocates for government’s enabling environment in the area of multiple taxes, noting that SMEs investors are on daily basis being harassed with different forms of tickets by government agents in the name of taxes.

Ehizogie, who adds that the firm commenced operations in 2012, with branches across the 36 states of the federation, including Abuja, also calls for financial assistance to boost the sector.