Tomato Paste Company, Erisco Suspends Operations over Scarce Forex

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Tomato Paste Company, Erisco Suspends Operations over Scarce Forex

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The lingering scarcity of foreign exchange has taken its toll on another sector of the economy. About 1,500 employees of a Lagos-based tomato paste manufacturer, Erisco Foods Limited, are set to lose their jobs as the firm has shut down its $150m plant in Lagos.
Chief Eric Umeofia

Chief Eric Umeofia

The Chief Executive Officer of Erisco Foods Limited, Chief Eric Umeofia, disclosed this on Wednesday in Lagos, attributing this to scarcity of foreign exchange.Following the decision to close down the business, some of the employees of the firm protested the action on Wednesday. They carried placards with various inscriptions calling on the Federal Government to save their jobs.Umeofia said he decided to shut down for one month over what he described as frustration in sourcing foreign exchange from the Central Bank of Nigeria.According to him, if at the end of 30 days, the situation does not improve, he will move his manufacturing firm out of Nigeria.He said, “We cannot get forex to buy machinery. We run our big factory with forex sourced from the parallel market at the exchange rate of N450/dollar. The companies that get forex at the official exchange rate are those that import items included in the list of items not valid for forex.“We cannot continue this business because we are running at a loss while importers continue to flood our markets with banned tomato paste and prevent our products from selling.”Umeofia said about 1,500 of the company’s 2,000 workers in the Lagos factory would have to go.Some of the workers, who spoke to our correspondent, said the decision to close the factory would spell doom for them with an indication that their jobs were on the line.“This factory is my only hope and if it is shut down permanently, it will mess up my home and generate a lot of stigma for me and my family,” Obinna Ezeugwa said.Another worker, Ayoola Oladayo, remarked that 5,000 families would suffer if Umeofia made good his threat to relocate his factory outside Nigeria.The Assistant Marketing Manager, Kelvin Onyia, a father of four, said, “Many of us who are bread winners would not know what to do if the owner moves the factory out of Nigeria.”

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