- Forex Scarcity Threatens Leather Factory
Scarcity and lack of access to foreign exchange (forex) is threatening the survival of the multi-billion naira leather factory project in Delta State. This is even as plans are underway to sponsor a handful of Delta youths to Europe, to acquire professional expertise needed in enhance the smooth running of the multi-million Naira state-of-the-art Shoe/Leather Works Factory in the state.
The N1.23 billion (S820,000) counterpart funding) Factory, which was set up partnership with the United Nations Industrial Development Organisation (UNIDO), was commissioned in May 2015, but has not been fully operational.
Part of the vision was to make the factory one of the biggest in West Africa, as well as reducing the unemployment index of the state, as when completed, would employ about 2,000 youths both skilled and unskilled.
Reacting to the development in a telephone interview the Executive Secretary, Delta State Micro, Small and Medium Enterprises, Development Agency (DSMSMEDA), Mrs. Shimite Bello, said the persistent rise in the exchange rate of the Dollar against the Naira has been a major setback in the commencement of the planned training exercise for the over 280 trainees (Deltans) proposed to be engaged at the centre.
She said the training is being organised in partnership between the Delta State Government and the United Nations Industrial Development Organisation, UNIDO, which is scheduled to commence in May, this year.
She however explained that given the continued scarcity of forex, the training may not hold anytime soon, except the high exchange rate, now at unprecedented highs is resolved.
Bello, in a telephone interview, hinted that aside the approval of the over N81 million for the proposed training, the State Government and UNIDO, had perfected all other necessary arrangements required for the smooth take-off of the training exercise.
While describing the market forces as circumstances currently beyond the control of the partners, she expressed confidence that once the current high exchange rate challenge normalises, the training exercise, which she described as critical to the SMART agenda of the government will commence.
She added: “We got the exchange at N324 to $1 (but) by the time the money came, the exchange rate was N385. Now, it has come down to N345; we have to watch the rate. But, as I speak with you right now, we are on queue at the Central Bank of Nigeria (CBN). You know that a lot of people are waiting for exchange currently, (but) it is not available. Until the money that we have currently can make transaction, we will still wait.”
She added, “I have spoken with UNIDO and have given them evidence that the money has been made available; anybody can go online and see that the exchange rate is really crazy; that is all that has been delaying it.
“Everything that the State Government needed to do have been done as well as that of the partnering agency, UNIDO, but the exchange rate, Naira to dollar is really crazy. We are waiting to ensure that we do good transaction.”
It would be recalled that the proposed training exercise is targeted at artisans in the state particularly, fashion designers and cobblers, among others.
But investigation revealed that the factory premises have been taken over by weeds and rodents with billions of Naira equipment rotting away, one security man at the gate who pleaded anonymity, decried government’s neglect of the factory.
He said: “I’m just here suffering in the midst of rodents and overgrown weeds, the place is completely moribund, the equipment locked inside the rooms are rotting away.”
In a swift reaction, the State Commissioner for Industry, Mrs. Mary Iyashere, who expressed regrets over the state of the factory, however assured of the Government’s commitment to reviving the factory, adding, “it is unfortunate that the factory had not lived up to its expectations, but the State Government will do something about it.”
