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Published On: Mon, May 8th, 2017

Ikpeazu’s China mission: Can it rescue Abia?

– Local shoemakers protest threat to their business

From PETER OKORE, Umuahia and Obinna Ezugwu

Recently, the Abia State Governor, Dr Okezie Ikpeazu embarked on a campaign to China with a view to attracting foreign direct investment from the world’s most populous nation to Aba, the commercial city of Abia State. The governor succeeded in striking a deal with Mr. Zhang Huarong, Chairman of Huaijan Group, one of the Asian nation’s largest producers of shoes and ceramics, who has promised to invest $1.5billion in the Aba shoe industry, and by extension, the Abia State economy.
With this prospect of heavy dollar injection into the state’s economy, the governor is counting his China trip as a huge success, but how much impact will this have on the lives of the people, and indeed the Abia economy.
Walking around Aba, the ingenuity of the people, particularly when it comes to shoe making, immediately stares you in the face. From the road-sides to the best of the super markets, made in Aba shoes are on display in various shapes and sizes. The once dying industry, thanks to the foreign exchange scarcity which has reduced the influx of foreign made shoes into the country, is beginning to pick up.
Most of those who abandoned shoe making for other business are coming back now,” said Asogwa Chiemeze, a shoe maker in the city.
“A number of people were frustrated out of the industry because of low patronage occasioned by the preponderance of foreign shoes. But Aba shoes are beginning to sell again because foreign shoes are now few and too expensive.”
Governor Ikpeazu had been an ardent promoter of made in Aba shoes, and according to Chiemezie, they were always grateful for his support. However, his recent decision to bring in foreign shoe makers is causing apprehension. Local shoe makers say, it is an attempt to run them out of business…..
While some of the comments coming from the government circles applaud the state Government for achieving the feat, others, mostly those from the business sector, are insinuating that the coming of the Chinese shoe-making investors will take away their businesses.

According to the reactions, those in support of the new China Shoe-manufacturing deal claim that they are doing so under the cover that Abia is in a hurry to develop and needs the Chinese mode of industrialization. They are also of the view that Abia needs to diversify its economy and increase its revenue potentials to beat the current recession, prevailing harsh economic conditions, un-employment and the rest of them.

On the other hand, those opposed to the new business deal do so, under the umbrella that Dr. Ikpeazu, the leading National vanguard of Made-In-Aba products, went to China with a high –powered delegation to create market for Made-In-Aba products, but returned with a company that is engaged in the same business they went to China to source an outlet market for. Those who think this way ponder over the numerous shoe-manufacturing industries located in Aba and parts of Abia state looking for patronages.

They say that if a former Head of State, Olusegun Obasanjo and the Army could patronise Aba shoes some days in the week be declared for Nigerians to wear Made-in-Aba dresses and shoes, stressing that all what is needed was marketing the products. It is their opinion that in-as-much as they would not write-off any foreign investments in Abia they do not want such foreign investments in the already established Shoe-making and Leather industries that are already making waves in Nigeria.

They are also considering other factors, including the huge debt-profiles of the state, arising from the bail-outs, backlog of unpaid salaries, pensions, gratuities and allowances spanning over years, and the low Internally Generated Revenue (IGR) and others. Some of the critics, most of who pleaded for anonymity, are also considering the Nigerian ownership and contents of the Memorandum of Understanding, MoU, of the new Shoe-making venture, after all.

Without much ado, the leadership of various shoemakers in Aba, under the aegis of Omenka Shoemakers, covering over 14 shoe clusters in Aba, including Ariaria, have already placed their grouse before g Ikpeazu at the Government Lodge, Aba, where they met with him. However the governor has assured that he will do everything to protect their business interest, warning that government will also do everything to thwart any plan to frustrate foreign investment into Abia state.

The Chairman of the Omenka Shoemakers, Mr. Williams Okechukwu , had in his speech thanked the gvernor for finding time to listen to them as well as making efforts to douse their fears over the coming of the Chinese investors, which they had thought will take away their businesses.
Okechukwu , on behalf of his members, thanked the governor for promoting their products in an unprecedented way since they started producing shoes.

He also promised his members will take advantage of the coming of the Chinese investors to improve on their business processes and systems with a view to competing favourably in global markets. They pleaded with the governor to ensure that only members of the Omenka shoemakers in Aba will make the list of the 100 persons who would leave the shores of Nigeria to China for further training.

Earlier the governor had briefed the Aba shoemakers on the gains and pains of having Chinese investors in the Aba shoe industry, assuring the shoemakers that their business interests will be protected by the government. He, however, challenged them to take advantage of the coming of the Chinese to improve on their skills and learn new ways of doing business. He also stressed that the state government will do everything to protect the business interest of Aba people and warned that the government will do everything to counter attempts to frustrate its efforts to attract foreign investment in the state.

“I invited you here to brief you on the outcome of my recent trip to China, where I took our made-in-Aba campaign to. I must commend you people for holding forth strongly in the leather and garment industry in Nigeria. I promised when I was campaigning to be governor in 2015 that I will promote made-in-Aba goods. I have been doing that and I am ready to take it a much higher level.

“When I went to China, I met with a major investor in the shoe industry who indicated interest in investing $1.5 billion USD in our economy, and the investor- Mr. Zhang Huarong of Huajian Shoe Factory Guangdong, China, has visited Abia State and I took him to some industrial locations within Aba, where we think he can site his industry. So, as people in the business, I thought it wise that I must brief you and assure you that his coming will not, in anyway, affect your business negatively. But let me also challenge you to take advantage of his coming to improve and upgrade your processes and systems in the industry.”

According to a release from the Chief press secretary to the Governor, Mr. Enyinnaya Apollos, the governor used the occasion of the meeting with Aba shoemakers to announce that about 100 of them from Aba would be going to China, any moment, for further training in modern ways of shoemaking which would make for competitiveness, and impact positively on their output and quality.
However, it will be recalled that the Abia state government delegation to China secured the USD $1.5bn fund(project) for the establishment of a Shoe Industry in Aba, the commercial nerve Centre of Abia State, from Huajian Shoe Industry in Dongguan, Guangzhou, China after a meeting with Mr. Zhang Huarong, Group Chairman of the Huajian Group in the course of his official visit to China for the 1st Nigeria-China Governors Investment Forum.

The factory (Abia-Huajian Shoe Industrial City) will be located in Aba and will have a production capacity of 5,000 shoes per day as well as employ about 10,000 people directly and indirectly. As part of the MoU, the Abia State Government will provide the land and other investment incentives for the project, while the Huajian Group will fund the entire project. The company is currently developing a 250 Acre Industrial City in Ethiopia and expressed his eagerness to come to Nigeria. At home, Huajian Group currently employs about 20,000 staff in China and operates a10,000 shoes per day factory in Dongguan valued at $2 bn.

Barely one week after Ikpeazu and his team returned from China the management of Huajian Shoe Factory Guangdong, China has visited Abia State to ascertain the level of preparedness of the state to host the planned massive investment. Speaking during the visit, the Chairman of the company, Zhang Huarong, made it clear that he was in Abia state to seal the deal which started during Ikpeazu’s visit to his Shoe factory in China andexpressed his readiness to partner with Abia State to deliver the Project on schedule.
According to Huarong, “China has enjoyed a robust relationship with Nigeria over the years, pointing out that having a factory in Abia would build-on that relationship as well as help accelerate the industrialization drive of the Governor”.

Huarong hinted that he desires to be part of the technological development of Abia State and Nigeria and also to share in its mining industry and commerce. He explained that the planned investment will project Abia state to the world, noting that Nigeria would be a major trade centre in the next 20 years as he sees a good future for the company in Abia State.
Responding to the remarks from the visiting Chinese team at the premises of a Chinese-owned Steel factory in Ukwa-West LGA of Abia State, Governor Ikpeazu said he choose the venue to show the Chinese team that some of their brother-investors were already on-ground in Abia and expressed delight at the level of infrastructure in the company while also applauding the employment of many Abians at the factory.

“With what Inner Galaxy(owner of the Steel factory) is already doing in steel fabrics and manufacturing in Ukwa-West, it is obvious that Chinese investors are already at home with Abia State interns of huge investments. The coming of Zhang Huarong and his team will boast the Aba Leather and Garment industry. We welcome them with our heart to come and invest in Aba. We also encourage our people to see their coming as a healthy competition.
I have no doubt that our people in Aba will take advantage of their coming and the competition it will provide to improve on what they are already doing. Our target is to conquer the African leather and garment market. I am happy that the Chinese investors are responding to our request for them to come and invest in our state and make their products in Aba, he said.”

He declared; “the first batch of Aba shoe markers will depart Abia for China in the next one week, for training.” He insisted that the best way to develop Nigeria is to adopt the Chinese module of public- private sector- partnership (PPP) for rapid industrialization.

Governor Ikpeazu confessed that he shares the vision of the Chinese Shoe investor whose mission is to ensure employment generation and described him as a potential development partner. He assured the Chinese team of government support to actualize the factory through incentives and accelerated certification. For a better future the Governor emphasized that Abia State is a fertile ground for businesses to thrive and invited local and foreign investors to look towards Abia to make and sell their products and services under a friendly business environment.

The Group from the Ceramics City in Foshan City, Guangdong, China are also still in Abia state inspecting Kaolin and Clay deposits and closing deals on the establishment of an Industrial City in Abia State to produce shoes, garments, electronics, electrical fittings, computers, mobile phones, etc.
Governor Ikpeazu has also had an audience with another Chinese business Mission to Abia State since his return from China. This time, it was Chinese investors led by the Chief Representative of Made- in- Africa Initiative, Mr Jason Zhu. Receiving the team at the Government House, Umuahia Ikpeazu restated his commitment towards the industrialization of Abia, expressing his passion to open-up the economic space of the state in order to advance its capacity- building, increase the state revenue-base and pay salaries, gratuities and pensions as-at- and when due, as well as create employment opportunities for the teeming number of un-employed youths.

Ikpeazu, remarked that the presence of members of the Chinese delegation marked the consolidation of proposed partnership with China towards the industrialisation of Abia state, stressing that his target is to push high earned goods and products from Abia to International markets. He emphasised that the multiplier effect will be of immense benefit to Abia state, in particular and country in general.

While bearing his mind that Abia state is naturally endowed with lots of resources and also strategically located for business, Ikpeazu put it to the visiting delegation that his recent visit to China was, as he put it,‘ ‘an eye-opener’ in the areas of manufacturing, I infrastructural developments, science and Technology, among others, saying, ’China has potentials which Abia can tap into’.
“No country advances beyond her nose unless the country is able to open-up the economic space to allow people to come and begin to produce one thing or the other from the environment. That is the way to advance and build capacity and engender healthy competition locally and within the international community.

“This government will do everything within its power to make sure that this visit will herald great things to come especially as it concerns providing job opportunities and producing high earned items, using the best technology and practice all over the world from Abia State.”

Meanwhile, sources say about 60 Abians would immediately be mobilized to proceed to the Huajian Group Headquarters in Dongguan, Guangzhou, China for training on the Group activities. . Another 140 will also be mobilized within months to go for other specialized training; thus bringing the total number to 200. At the completion of their respective courses in China, these 200 Abians would serve as Supervisors and Line- Managers of different Huajian Group activities in Abia State.

In the same vein a team of experts from Huajian Group are expected in Abia shortly to work with an ad hoc team put together by the Abia State Government to commence documentation, company registration, obtaining necessary permits and land preparation for ground-breaking of the project within the shortest possible time. Target market is 80% export to meet existing Huajian International orders, and 20% for Nigerian market.

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