The government plans to allocate N12.18m to evaluate nearly 8,000 dormant industries, a move that has raised concerns among stakeholders and reignited calls for privatisation, writes ARINZE NWAFOR
With the Federal Government setting aside N12.18m in the 2026 budget for a continuous nationwide survey of 7,841 moribund industries, stakeholders have again questioned the state’s involvement in running industrial enterprises, warning that prolonged inertia could undermine the country’s industrialisation drive.
In the 2026 Appropriation Bill, the allocation of N12.18m falls under the Federal Ministry of Industry, Trade and Investment line item titled ‘Continuous National Survey on 7,841 Moribund Industries in Nigeria’. The provision comes as part of a broader N58.47tn budget proposal submitted to the National Assembly.
In separate interviews with The PUNCH, stakeholders welcomed the survey as a necessary assessment to learn the scale of damage and needed repairs. They also noted that the persistent failure of state-owned enterprises underscores the need for a decisive shift towards privatisation, concessioning, and private-sector-led reactivation.
Govt should not run industries – MAN
The Director-General of the Manufacturers Association of Nigeria, Segun Ajayi-Kadir, said the government should largely withdraw from running industries, stressing that decades of state ownership had yielded little but inefficiency and waste.
“My position has always been clear: the government should, as much as possible, stay away from running industries. So, if those industries that will be revitalised are government-owned, then the fair cut is that we should just move away from them, advertise them and let them be productive,” Ajayi-Kadir said.
He questioned the rationale behind repeated spending on non-performing assets, warning that continued public funding without structural reform amounted to throwing scarce resources into ventures with little prospect of returns.
“The amount is huge. And you see, if the government has businesses that have been running and they are moribund, what makes sense is that we shouldn’t continue to throw money down the drain. It’s not viable. And the number of industries is 7,841,” he added.
Meanwhile, the National Vice President of the National Association of Small-Scale Industrialists, Segun Kuti-George, acknowledged that a comprehensive survey could help policymakers understand the true status of inactive firms and the economic losses associated with their dormancy.
“It would be interesting to really know what status they are at. And I believe that’s why there’s a need for that study or survey. It is then for us to understand what needs to be done,” he stressed.
Kuti-George argued that the outcome of such an assessment should be a clear exit strategy for the government from direct ownership, rather than another cycle of budgetary support.
“What I think should be done, the overarching approach, is that the government should completely privatise those entities. We have seen too many government-run businesses that have not done well, and so we mustn’t continue to follow that path,” NASSI’s VP said.
N7.89bn goes to Ajaokuta Steel and related projects
Beyond the survey allocation, The PUNCH found provisions in the 2026 budget for the continued funding of one of Nigeria’s most infamous industrial failures, the Ajaokuta Steel Company Limited.
Data from the Appropriation Bill show that the Federal Government allocated a total of N7.89bn to Ajaokuta-related operations and projects under the Federal Ministry of Steel.
A breakdown of the figures indicates that Ajaokuta Steel Company Limited received N6.69bn for its operations, comprising N6.04bn for personnel costs, N233.63m for overheads, and N410.8m for capital expenditure.
In addition, the Ministry of Steel allocated N1.06bn for project preparation and investment mobilisation for feasibility studies, environmental impact and social assessments, and financial modelling, as well as N150.99m for the revitalisation of Ajaokuta Steel Company Limited and the National Iron Ore Mining Company.
Despite these allocations, the company recorded zero naira as total retained independent revenue, reinforcing concerns about its fiscal sustainability and economic relevance.
NASSI’s VP Kuti-George described the failure of Ajaokuta as a painful symbol of Nigeria’s industrial missteps, noting that steel production had historically played a transformative role in the development of advanced economies.
“The fact that Ajaokuta did not work, honestly, is a disaster. It’s a very painful thing that we could not get Ajaokuta to work. Steel was what liberated Japan and launched it into industrialisation,” he said.
He added that Nigeria’s inability to operationalise the steel complex had denied the country opportunities for import substitution, export earnings, and downstream industrial growth.
“If we had steel, apart from the fact that we would have been doing a lot of things locally, we would have been exporting steel and making a lot of money. But they didn’t make it work, and subsequent governments have pumped money into that place. It has become a drainpipe,” Kuti-George noted.
He expressed scepticism about further investments in the ageing infrastructure at Ajaokuta, much of which was installed several decades ago, arguing that attempts to revive the existing plant would likely result in further waste.
“Any attempt to say we want to make that old one work, and we will just be throwing money away again. I think we should just take our loss. Forget that we have spent money there. If we want to do steel, build a new one,” he said.
Kuti-George maintained that the proposed survey of moribund industries should serve as a decision-making tool to determine which assets are worth salvaging and which should be abandoned or divested.
“What is important is the fact that we are trying to determine what the economy is losing as a result of the inactivity of those industries and whether there is anything that can be done to either reactivate or activate them. The exercise is a good one. We need to determine if we need to take our losses rather than continuing to pump money into something that may not work in the end,” NASSI’s VP explained.
Reversing Ajaokuta Steel’s decade of non-productivity
The debate over Ajaokuta Steel’s future has persisted for years. The PUNCH earlier reported that the Federal Government paid workers of the moribund steel company N38.9bn in salaries and allowances over 10 years, despite the plant not producing steel.
Data from 2014 to 2024 showed billions of naira allocated annually to personnel and allowances, with limited progress on operational revival.
In 2024, the Minister of Steel Development, Shuaibu Audu, said the government was at an advanced stage of raising over N35bn to restart the Light Mill Section of the company.
The minister noted that, according to technical assessments, fully reviving Ajaokuta within three years will require between $2bn and $5bn. The government also signed a Memorandum of Understanding with a Russian consortium for the rehabilitation and operation of the steel complex and the National Iron Ore Mining Company.
