Business News
Ajaokuta Steel may commence full operation as it gets N3.79 billion allocation
As part of efforts to revive the long-abandoned Ajaokuta Steel company, the FG has allocated a total of N3.79 billion to the company for 2020.
As part of efforts to revive the long-abandoned Ajaokuta Steel company, the Federal Government has allocated a total of N3.79 billion to the company for 2020.
The breakdown: Nairametrics understands that N2.67 billion was allocated for the payment of salaries and N858 million for social contributions. While N3.60 billion was earmarked as total recurrent expenditure, N75.2 million was budgeted for overhead cost.
N3.85 million will be spent on travels while N7.82 million is general utilities. Under general utilities, telephone and internet charges will cost the company N2.2 million and N2.46 million respectively. The sum of N2.84 million was budgeted for water rate.
[READ ALSO: Ajaokuta Steel capable of creating not less than 600,000 jobs – NIMMME boss]
For materials and general supplies, a total of N6.39 million was allocated. Out of the amount, N3.6 million is for office materials/computer consumables while newspapers and magazines/periodicals will cost N180,000 and N114,400, respectively.
The sum of N145.4 million will be spent on the purchase of fixed assets, out of which N41.3 million is meant for the purchase of buses. The steel company is to purchase security and industrial equipment with N10 million and N94 million accordingly. Rehabilitation/repairs of the company’s fixed assets will cost N43 million.
What you should know: Although the company is yet to commence full operations as it is still in the rejigging process, it has been projected to drive massive industrialisation in the country when operational.
Efforts to revamp the Ajaokuta steel mill failed in the past. However, there is the latest offer on ground by the Russian company, MetProm Group, which assessed the complex and tabled the issues facing it before the Federal Government.
It was made known that the Ajaokuta Steel was burdened by some ‘outstanding infrastructural issues’, and if the steel company is to resume operation, the Federal Government will have to address the issue.
[READ ALSO: Russian company, MetProm Group, identifies problem of Ajaokuta Steel]
Meanwhile, the Federal Government is yet to come out with a clear decision on the offer but the Minister of Mines and Steel Development, Olamilekan Adegbite, hinted that there was a possibility that the government was looking towards Russia in renewed efforts to revive the company.
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