Recession: Erisco Foods shuts down Nigeria’s factory, relocates to China

Erisco Foods Limited has announced the shutdown of its tomato manufacturing business in Nigeria citing an unfavourable operating climate which has escalated operational costs in recent months, The Sun reports.

The President/CEO, Chief Eric Umeofia, said the company had concluded plans to relocate the manufacturing aspect of the business to China from where finished products would be imported and sold to consumers in Nigeria and other parts of the world.



According to him, the decision to shut down the Nigerian manufacturing plant was taken after the expiration of a 30-day ultimatum given by the management of the company to the FG to compel the CBN to make available enough foreign exchange (forex) to assist in the imports of raw materials as well as the requisite equipment needed to keep the manufacturing plants running and also profitable.

He said: “In recent months, our continuous operation in Nigeria has resulted in a loss of over N3.6bn investments. It’s unfortunate that out of a workforce of about 2,000 Nigerians that we have, we will be disengaging about 1,500.

My business has been deliberately frustrated by the way the CBN has managed forex bidding and allocation. They won’t give us forex to import machinery, machine spare parts and raw materials for processing Nigerian fresh tomatoes into paste in our Lagos factory and they won’t give us approval to use our own money (about $460,000) generated from our foreign operations to import our raw materials.


They won’t also check dumping because of the powerful nature of the import cabals. This decision is therefore final and there is no going back on it; nothing will make us come back even in the future because we have found out that we can import tomato paste into Nigeria and still make huge profits."


Umeofia said the company had similarly abandoned the Katsina state backward integration programme with the Certificate of Occupancy on the 2,400 hectares of land issued to the company returned to the state government.