Resolution of Samsung, LADOL dispute bolsters Korean firms confidence in Nigeria
The intervention by various agencies of the Federal Government in the resolution of the rift between Samsung Heavy Industries Nigeria Limited (SHIN) and LADOL Group, has bolstered the confidence of Korean companies in doing business in the country, enquires show.
The promoters of these companies believe that the intervention of the various agencies of the government is a demonstration of the commitment of the administration of President Muhammadu Buhari to encourage foreign companies to invest in the country.
A number of Federal Government agencies like the Nigerian Ports Authority (NPA), the Nigerian Content Development and Monitoring Board (NCDMB),the Department of State Services (DSS) and other agencies have made intervened in resolving the feud which tore the partnership between SHIN and LADOL apart.
A rift bordering on the ownership of SHI MCI FZE (the integration and fabrication yard in LADOL Free Zone), the existing sublease arrangement and SHIN’s operating licence renewal threatened to ruin the partnership that delivered one of the most successful engineering projects in the country.
One of the interventions by the Federal Government was made by the Nigerian Ports Authority (NPA) recently when it leased a total of 11.2426 hectares of the land (where SHI-MCI FZE yard is located) at the LADOL free zone to SHIN with a view to protecting the company’s investment on the base.
This action reassured foreign investors, particularly Korean companies that the Federal Government is determined to protect their investments in the country. SHIN’s new lease with NPA has reassured investors of the security of their investments.
“This development has encouraged other South Korean companies to look forward to coming into the country,” said a source close to one of these Korean companies, who spoke to journalists in Abuja. He said that some of these companies are now favourably disposed to investing more in the Nigerian economy.
SHIN came into Nigeria and constructed Africa’s first ever Fabrication and integration yard, other Korean companies, including companies in the Samsung group had showed interest to come into Nigeria but were discouraged by the feud between SHIN and LADOL. Some of these companies are looking forward to the final resolution of the dispute to make their investment decisions.
Some of the Korean companies reportedly interested in Nigeria include other members of the Samsung Group of Companies such as world-leading Korean automobile company and Samsung Construction & Trade, which came to global limelight when it built the Burj Khalifa, the tallest skyscraper in the world. It was also gathered that Samsung Construction & Trade, which was operating in Nigeria later left due to the harsh operating environment in Nigeria.
These planned investments could be a big boost to the efforts of President Buhari to encourage made-in-Nigeria cars, which could drive down the cost and become cheaper than the imported ones hence these investors are urging the Federal Government to pursue the resolution of the dispute to its logical conclusion.