Shareholders cry out over Dunlop, seek review of industrial

Shareholders cry out over Dunlop, seek review of industrial

By ABDUL IMOYO

Independent Shareholders Association of Nigeria (ISAN) has said that shareholders stand to lose their investments in Dunlop Nigeria plc should the Federal Government fail to overhaul its industrial policy and make domestic companies globally competitive. Sunny Nwosu, ISAN national coordinator, said that government’s urgent intervention became imperative because the negative industrial policy makes vision 2020 unattainable.
 

Specifically the shareholders pressure group leader identified the subsisting problem of the nation’s tyre industries, especially the closure of Michelin Nigeria Ltd and the near collapse of Dunlop plc as a case study.

 
He said that while Michelin lost about 2,000 Nigerian workers, Dunlop would be forced to relieve about 4,000 workers of their jobs at both its factory and rubber plantations, due to the antigrowth national industrial policy.
 
Nwosu said that the current dismal national industrial policy has not only impacted negatively on operating companies and employees but made wealth creation through the capital market near impossible.
 
According to him, government’s nonchalant attitude to the predicament of manufacturing companies and the near zero duty on imported goods “has made the Nigerian economy and Nigerians uncompetitive globally.”
 
“We are aware that when Dunlop went to the market for N8 billion to expand its truck tyre lines, duty on truck tyres was 40 percent but government in a sudden twist reduced the duty to 10 percent at the end of 2006, which coincided with the commercialisation of its new radial truck tyres, without the attendant implication to national economy,” he said.
 
Nwosu lamented that the worst of the issue which government had evaded over time was that many importers now use the 10 percent duty window for truck tyres to circumvent the law in respect of the current 50 percent duty on car tyres and render local plants redundant.
 
To him, “unless government urgently tackles the epileptic phase of the real sector, the other sub-sectors will soon experience what the textile and the tyre industries passed through.

“As shareholders, we are concerned because the installmental closure of companies, especially quoted companies and its implication for domestic investments and returns on investments, clearly challenge government economic vision,” Nwosu said. –Businessday


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