Business
Ogun displaces Lagos as Nigeria’s industrial hub
... To host Nigeria’s largest sea port
With the Dangote Group’s to build the largest seaport in the country in Olokola Free Trade Zone, Ogun State, which is already displacing Lagos as the manufacturing hub, will emerge the new economic power-house of the nation with most port activities shifting there.
Currently, there is the daily influx of manufacturing companies from Lagos, the nation’s hitherto economic capital, and across the globe into its industrial zones, Business Hallmark can report.
At the last count, more than 3,500 industries have built production plants and warehouses in the state’s six industrial clusters of Agbara, Igbesa, Sango-Otta, OPIC-Ibafo-Mowe-Interchange, Sagamu and Ijebu-Ode industrial clusters.
From Nestle’s multi-billion dollar factories in Agbara and the Sagamu Interchange on the Lagos Ibadan Expressway to Dangote Cement’s ultra-modern plant in Ibeshe (the biggest in Africa), and Flour Mills of Nigeria’s state-of-the-art factory in Igbesa, the Gateway State, as it is commonly known, has moved out of its shadows to become the fastest growing manufacturing hub in Nigeria.
According to available data, the 8,000 hectares Agbara-Igbesa Industrial Estate, which includes the Ogun-Guangdong Free Trade Zone (OGFTZ) owned by the Federal Government, host one of the largest industrial concentrations in Sub-Saharan Africa. In fact, it is the zone that makes Ogun the industrial capital of Nigeria.
While the Agbara-Igbesa Industrial Estate currently plays host to over three hundred active companies, including Viju Industries, Nestle Nigeria, Unilever, Flour Mills of Nigeria, African Minerals, Beloxxi Group, NAMPAK-BEVCAN, TGI Group, Olam, Hayat Kimya, WEMPCO Steel Mills and the multi-billion naira Allied Atlantic Distilleries Limited ethanol manufacturing plant, the OGFTZ alone, has seventy-four operational factories built by companies from across the world.
In the same vein, the Sango-Ota/Ibeshe-Papalanto-Ewekoro Industrial Estates host the largest core of Indigenous manufacturing companies like De-United Foods (manufacturers of Indomie noodles), Dangote and Lafarge Cement plants, Drugfield, Kolorkote, Fidson Drugs, Intercontinental Distillers, Pure Chemicals, Fine Chemicals, Farmex Mayer, Shanghai Packaging, Eagle Packaging, Leady Pharma, May and Baker, Nycil Ltd., Honda Nigeria Plc, and Assometal.
Likewise, the new Flowergate Industrial Park, which starts from Isheri North on the Lagos-Ibadan Expressway through to Sagamu, is home to Coleman Cables, Honeywell Group, PZ Nigeria Plc, Nestle, Olam, CDK Ceramics, AbInbev, Franemm Industries Ltd, makers of Petals hair products and De Wave detergents, GIC Motors (manufacturers of GAC vehicles), Mikano, Lifemate Furniture and over 60 other manufacturing companies.
The Catalyst
According to BH findings, several factors are responsible for Ogun’s emergence as Nigeria’s fastest-growing industrial hub.
They include proximity to Lagos, vast expanse of relatively cheap land and various other economic, political and social reforms put in place by the last three administrations in the state, which created a much improved business environment conducive for foreign direct investment.
Specifically, the administrations of former governors, Gbenga Daniel and Ibikunle Amosun, as well as that of the incumbent, Dapo Abiodun, set up the Department of Trade and Investment to facilitate more domestic and foreign direct investment.
The agency was given the responsibility of creating a one-stop-shop, reduce bureaucratic bottleneck and formulate an enabling environment for genuine investors.
The agency was also charged with the responsibilities of facilitating industrial growth and investments in Ogun State by providing the necessary framework in place to connect local businesses with right business partnerships, supplies, service providers, and investment opportunities for the facilitation of business growth; attract investments in and outside the state through promotional means; seek for infrastructure development in the form of industrial estates, incentives for capital investment and other subsidies, and the provision of power, land and water, besides function of fiscal incentives to the prospective entrepreneur.
To achieve this, the state government complemented the provision of industrial support and relevant infrastructure, re-energizing existing agricultural hubs and creating new ones, re-engineered efforts towards improved steady electricity supply, and provided suitable land in designated urban and rural areas.
An industrialist who owns a plastic recycling plant in the state, Chief Dejo Folarin, told our correspondent that the two key drivers of investors to the state are tax and land rebates.
According to the industrialist, manufacturers are trooping to the state because they are able to lower production costs through tax rebates and cheaper lands.
According to land beneficiaries, who spoke with our correspondent on the matter, Ogun State is generous enough to offer 70 per cent rebate on cost of land and also make the documentation of such properties easy and prompt by the removal of the hitherto frustrating administrative roadblocks.
Comparative advantage
The state has also been working with the Bank of Industry (BOI) to make credit facilities accessible to investors.
“Gbenga Daniel started the investment rush by giving lands to committed investors at a token. Manufacturers require a lot of space for their plants and warehouses to store their raw materials and finished products which Lagos no longer has. Even when they can make it available, it comes at a premium.
“However, some of us got lands in Ogun at giveaway prices. I paid a nominal fee of N1 million for a land allocation, which would have cost billions to acquire in Lagos.
“The state also ensures that the processing of land titles, especially that of certificates of occupancy (C of O), is very easy and seamless.
“The icing on the cake is that the cost of doing business in Ogun is far better than what obtains in Lagos. While taxes are fewer, they are also more friendly.
Another factor that is driving businesses to Ogun is the availability of huge natural resources scattered all over state, which investors are scrambling over themselves to have mining rights.
According to data compiled by the Federal Ministry of Solid Minerals, Ogun is blessed with limestone used in the cement industry, bitumen, soft sand used for construction purposes, glass sand (for the production of bottles), laterite, tar, kaolin, gypsum, quartz, feldspar, mica, phosphate, silica sand, and many others.
Some days ago, Africa’s richest man, Alhaji Aliko Dangote, announced plans to build Nigeria’s largest seaport at the Olokola Free Trade Zone (located in between Ogun and Ondo State) and also resume work on his $1billion worth 6-million-ton cement plant in Itori in Ogun State.
When fully completed in 2026 as planned, the facility will increase Ogun State’s cement production capacity to 18 million metric tons per year, making it the highest cement-producing region in Africa.
BH checks revealed that in the last 10 years, major manufacturers in Lagos had relocated their factories to Ogun State, leaving only their administrative offices in Lagos.
Despite that, Ogun has not fully enjoyed the benefits of hosting companies plants and warehouses in the state, as host states of firms corporate headquarters largely get the Company Income Tax (CIT) paid to government.
However, that is about to change with the 2024 Tax Reform Bills sent to the National Assembly by the executive arm of government.
Rising from one of their meetings, the Nigerian Governors Forum (NGF) recommended the sharing of tax proceeds based on 50 percent equally among states, 30 percent based on derivation (production and consumption), and 20 percent based on population.
Expected Benefits
With its expected share from the 30 percent allocated to derivation (production and consumption), experts project that Ogun State, which is the state with the 3rd largest IGR in the federation (it raised N240.24 billion in 2024) behind Lagos and Rivers, will jump into second position.
“With Ogun State housing majority of Nigeria’s factories and manufacturing plants, it is going to benefit massively when the tax reform bills are finally passed into law.
“Ogun should be the second largest state in Nigeria by population after Lagos as many Lagos workers reside in Ogun.
“Most residents of Ogun communities like Arepo, Mowe, Ibafo, Asese, Akute, Adiyan, Magboro, Alagbole, Ojodu-Abiodun, Sango-Otta, Agbado, Agbowa, Ifo, and many more work in Lagos.
“By Nigerian law, taxes should be paid based on state of residence and not place of work. We are hoping that the coming census exercise, which put Ogun behind states like Kano and Kaduna will rectify the anomaly”, said Dayo Akinlade, a revenue officer with the Ogun State Internal Revenue Service (OGIRS).
Ogun is among the few states that can survive independently of the Federal Government’s allocation.
In 2024, it raised about N300 billion in Internally Generated Revenue (IGR). In 2025, the state joined the League of States with budget estimates topping one trillion naira with a budget estimate of N1.054 trillion.
