Thursday, 8 September 2016

Cross River Garment Factory And Dr. Frank Ayade: Separating Truth From Outright Lies.


Governor Ben Ayade
Cross River State Garment Factory is the largest garment factory in the world by floor size and is awaiting the Guinness Book of World Records verification. The factory is a project of the Cross River State government under the leadership of Ben Ayade, the executive governor of the state.

The garment factory is a very innovative investment in Nigeria at a time of recession and is expected to create more than 3,000 jobs in shifts for Cross Riverians, especially women, and reduce importation of garments by promoting local production. The factory is expected to also promote economic development in Nigeria and add to the growth of the Gross Domestic Product.

In recent times, the Cross River Garment Factory has been trending in the media for many good reasons. The first is that of all the states in the federation, the factory is one of the most outstanding projects from any governor in the first year.

On the other hand there has been some negative publicity related to the garment factory propagated by a few Cross Riverians which has to do with the ownership of the garment factory and alleged embezzlement of funds appropriated for its construction.

I sought to find out more about the Cross River Garment factory for myself and many other Cross Riverians who would love to know the truth about the factory and separate them from the half-truths and lies being peddled in the media. In this journey of discovery, I took a trip to the garment factory to see things for myself, met the commissioner for Commerce and Industries and had a chat with him and spoke with some of the contractors involved in the construction of the factory.

I also met the commissioner of finance in the state, met with some of the contractors, candidates shortlisted for employment in the garment factory and engaged a few citizens on their views about the garment factory. It was indeed an exciting and very revealing expedition. Follow me on this journey as I bring you up to speed on some of the things I discovered. I promise some of them will astound you.

The Cross River Garment factory is located on 2000 square meters land space on the Goodluck Jonathan bypass in Calabar, the Cross River State capital. The edifice stands in a picturesque landscape with well-pave driveway and parking lot to accommodate expected clients and staff vehicles. Inside the factory are more than 2,000 electric powered garment production machines ranging from cutting to sewing, embroidery, ironing machines and many more. I observed that many of the machines are computerized.

Work at the garment factory was more than 98 percent complete but there was still some skeletal work going on as a heavy duty equipment could be seen moving at the back of the building. A careful observation shows clearly that billions of Naira have been spent in bringing the factory up to that level of completion from the initial hills, trees, stumps and shrubs that occupied the area. These could still be seen in the adjourning landscape.




On my visit, I met over 300 shortlisted applicants who had been invited for interview for employment at the garment factory. Present also were some appointees of government; special advisers and commissioners. Everyone was in high spirit and excited about the opportunity the garment factory portends even as the governor was expected to flag off the screening process later that morning.

There was a little rain that morning but that did not stop the Commissioner of Commerce and Industry, Peter Egba, from coming down from his car to join the applicants and guests under the canopy set up at the car park. We shook hands as we exchanged pleasantries. I immediately got to the business that brought me to the factory.

Even as I was fascinated by what I had seen at the Cross River Garment factory, there were a few questions which I needed answers to and I am sure many Cross Riverians also needed answers to these questions too.

The first question was, who owns the Cross River Garment Factory? Is it owned by the Cross River State Government or an individual? The commissioner answered the question very clearly. “The factory is a property of the Cross River State Government.”

He said, “The Cross River State Government registered a Special Purpose Vehicle SPV to drive the project and achieve expected objectives and outcomes for the factory considering the peculiar challenges of government owning and running businesses in Nigeria.”

I heaved a sigh of relief as that was the most important question of concern to me. Even though I was happy to hear this, another concern cropped up quickly on my mind. I however let the commissioner go on with his explanation.

He explained further that “the Ministry of Finance Incorporated (MOFI) owns majority shares in the company with three million allotted share capital. Making Cross River State the effective owner of the project.(documents attached)

Two prominent and respected Cross Riverians, Edward Obi Akatcha, the former provost of College of Education, Akamkpa and Barr. Emmanuel Ubua, the former Nigeria Bar Association NBA Chairman in Ogoja branch were also made shareholders and One million five hundred thousand shares were allotted to each of them.”

“Four million shares were left unallotted in order to perfect the opportunity for Public Private Partnership through Foreign Direct Investment FDI or Local Direct Investment LDI in the project”, he added. This concept could be a little confusing for a layman but just follow me as I seek to get more answers.

At this point I asked the commissioner to throw more light on the wisdom in using prominent Cross Riverians at the level of incorporation of the garment factory. His response was plausible.

Here is what he said:

“The plan of Government was informed by the poor perception that foreign investors do not see an SPV that is wholly owned by government as a serious going concern because they feel government is the worst entity to do business with.”

“So the state adopted a model of having patriotic Cross Riverians of integrity to hold sway and promote the company until it is set up. Moreso that commissioners had not been appointed at the time of incorporation and you know that the Governor immediately after inauguration hit the ground in search of investors and had to sell the prospects in the state and called for partnerships along public private models.”

He then added that “The two private directors had prior to their engagement given commitment in writing that as soon as the company is set up, their shares were going to be relinquished to the state but they shall remain non executive directors of the company and be allotted one share each.”

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