The Lubricant Producers Association of Nigeria (LUPAN), an umbrella body of lubricant producers in Nigria, has called on the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to jettison the proposed Import Permit Requirement for all imported lubricants, as it is bound to force the shutdown of the “entire existing plants in the country, who are currently producing below 30% of installed capacities”.
According to a position paper signed by the Executive Secretary of LUPAN, Emeka Obidike, and addressed to the NMDPRA, “the hue and cry of our organization has as always been the advancement of the indigenous lubricant market in tune with the trends, drive and demands of the 21st century global market, at par in quality, diversity and versatility with global frontrunners”.
The proposed policy, LUPAN argued, “will kill the growth recorded in the last few years in the sector, and set back the lubricant policy of the Federal Government, which is currently being perfected by the Federal Ministry of Industry Trade and Investment in the lubricant Industry”.
Adding that the implementation of the proposed policy is bound to dissuade more investment opportunities in the lubricant industry, the body affirmed that “we have a capacity far above national demand and even export, but currently being idled because of the influx of finished products.
“It’s the strata of every organ of government to carry out programmes of the federal government, therefore, this will work against the renewal hope agenda, of the current administration on Backward Integration Policy for the Manufacturing Sector”.
Aside other negative effects, LUPAN said the proposed policy has the tendency to increase crime rate in the country “as a result of the over 200,000 direct jobs that will be affected.
“There will be increase to breakdown of machineries all over the country, as result of low-quality lubricant imported into the country, with recycled oils without additives. The new policy will ultimately create serious compromise, similar to what the sector is experiencing in the indiscriminate granting of basic oil import permit license to none plants”.
LUPAN also reasoned that the proposed policy will “will create an unfavorable market advantage to the imported lubes, because of many factors such as Power, Multiple Taxation, forex fluctuation, infrastructure, banks high interest etc. Many companies might slip into bankruptcy and insolvency because of the huge loss to be experienced”.
Stating that the proposed policy would undermine and frustrate government effort to revamp the economy, LUPAN explained that “every country protects the key businesses that they have due advantage, same is expected from your esteemed agency (NMDPRA) rather than kill same”.
Reaffirming its unalloyed commitment to NMDPRA, its goals and vision, LUPAN nonetheless stated that “we are most disheartened and disillusioned by the fact that government agency which should be at the forefront of every effort and scheme to bring about a more conducive environment for business to thrive, are wont to eagerly and arbitrarily formulate policies and regulations, that would insidiously and surreptitiously undermine and frustrate the government effort to revamp the economy.
“We thus, reiterate our appeal to the Authority Chief Executive (of NMDPRA) to use your good office to facilitate the Cessation of the import permit requirement for all imported Lubricants into the country”.
The position paper concluded by stating – “Sir, we categorically affirm with depth and sincerity and humility our belief in the administrative perspicacity in your eminent office to proffer an effective solution to the aforementioned dilemma”.
