The two, Isoglass Industries Limited and TSG Limited are threatening to close downs should the government fail to address dangers posed by the import of sub-standard auto glasses in Nigeria.
Already, under the umbrella of Glass manufacturers Association (GMA), the employers had petitioned president Obasanjo urging him to rescue the local producers from the onslaught of these cheap and sub-standard imported auto glasses.
In this piece, the chairman of the Glass Manufacturers Association, Chief Chris Aviele gives insight into members problems.
To start with, Chief Aviele noted that the production of automotive glasses in Nigeria dated back to early 80s with Isoglass Industries Limited and TSG(Nigeria) Limited were the only two auto glass manufacturers in the country with products satisfied by the Standard Organisation of Nigeria (SON) which meant that such products are of international standard.
"With over twenty-years experience in the production of auto glass, the contributions of the two glass companies to the development of the Nigerian economy are enormous. In the area of job creation over 5,000 able Nigerians are gainfully employed either directly or indirectly by the two companies. But the job of 3,000 of these men and women are being threatened because some callous and selfish fraudsters are carrying on with their acts to gather for themselves and their immediate family enormous wealth at the expense of Nigerians."
"Apart from the job creation by these two companies, huge revenue is returned to the purse of the government in form of taxes and other tariffs. These run into millions of naira. This notwithstanding, we are not reneging in the area of social and community responsibilities. Having gone through what the Nigerian economy and people stand to gain, one will then wonder why some people should be allowed to destroy such organisations while in the developed countries, their goods are jealously protected."
Undermining the economy
The chairman said given a level play field, Isoglass and TSG would stand-up to the competition but where fraud was involved ,only the fraudstars would benefit to the detriment of the country at large not just the companies concerned.
"The activities of these fraudsters have been on for some time, but it peaked in the last 10 months taking advantages of laxities in our ports, especially the Eastern ports- The Port Harcourt and Calabar. What they do is to go to the far East, especially China to bring low quality automotive glasses to this country. Most auto-glasses that are manufactured in Nigeria come in double. We have two glasses coming together and a plastic in between. That is the standard prescribed by the Standard Organisation of Nigeria (SON). But in the Middle East, they have single glass. You are all aware that Nigerians are much obsessed with second-hand products. As a user, the best thing for you to do is to insist on auto-glasses with double glasses if not, you will always buy the sub-standard one which is dangerous. The standard is to put 2.5mm thickness together and you have 5mm thickness plus the interlayer".
"Our major problem is that those importers besides bringing in sub-standard products, they are not paying the current duty. they are under invoicing compared to us that are paying the correct duty on whatever we brought to this country. Unlike them, we have workers whom we might be forced lay off if the trend is not checked, we pay rent, we pay for power, water, service on loans from various banks as well as other factors of production. But these people create no jobs. All they need is one sales girl or boy, and one point of light. But the two organisations put together, we have lost more than 70 per cent of our budgeted revenue. Like if each organisation targets a turn over of N700 million, put together N1.5 billion annually from the two companies is lost."
"In fact, this group operate on the basis that anything goes in Nigeria. The problem of under involving is not new to Nigeria. Some of these invoices carry about 16 per cent of the real value of the import. This in turn under-cuts the import duty to be paid to the government. With this, your guess is as good as ours as regards the selling price of these products. We have proof of the charges. Their method is to obtain two proforma invoices from the country of origin. One is the actual invoice showing the correct quantities and correct amount in dollars. The second is a fake invoice showing similar quantities but a value in dollars of about 16 per cent of the real value. The importer then opens a letter of credit for the smaller value and difference is paid in cash with our hard earned foreign exchange."
Carnage on our roads
According to Chief Aviele, the quality of standard of an automotive glasses, especially the windscreen was such that it should provide perfect visibility (no optical distortion or secondary object/image) and be able to withstand impact and weather effects as such, the two companies had been made to adhere strictly to this standard for which SON had given them quality award yearly.
"Let it be known that most of the accidents on our roads, especially those at night, are due to the effect of poor visibility resulting from poor quality windscreens. Such is the situation with these importers who are bent on making huge profit even when they know fully well that their selfish acts will lead to loss of lives. From the information gathered, it was realized that some of these importers would request their foreign collaborators to intentionally supply them with substandard products so as to further bring down the cost and increase the profit margin. All these are done with nobody to check them while our two companies (Isoglass and TSG) are made to comply rigorously with stringent conditions of the Standard Organisation of Nigeria (SON) and that of the Assembly Plants. This way the competition can not be fair and it can be anything but healthy. Not for the country; not for the economy; not for the people and most importantly not for the local indigenous manufacturers."
To check all these problems, save the lives of motorists in Nigeria, and save the jobs of workers of these two companies and ensure their contributions to the Nigerian economy and development, Chief Aviele said the employers would want the government to do the following:
"The Federal Ministry of Finance who is the supervising ministry of the inspection agents must request the inspection agents to do a more thorough inspection as to value and quantity imported auto-glasses at the point of shipment to forestall underpayment of duty and custom services must have a price range of the products to know whenever any importer is undervaluing his import. A more vigilant custom services should be able to detect any foul play and make necessary Debit Note for underpayment of import duty whenever any issue of under valuation is noticed. Imported Windscreens should be banned henceforth. At least, the import duty should be raised to 75%. Request the Ministry of Finance to rule that Containers containing windscreens (HS Code 7007.11) pay a fixed rate of duty i.e. on a 20 feet Container duty payable of N4,000,000.00 and on a 40 feet Container duty payable N8,000,000.00. To request that Nigerian Customs Services to be more vigilant at the Port Harcourt/Calabar Ports as these fraudulent traders use these points as their ports of discharge".
"If the interest of the Nigerian economy and safety of life of our people is of any importance to us, then we should all call on the government to come to the aids of local industries. We can not allow these unscrupulous importers to continue to capitalize on the corruption of some bad elements in government agencies to bring in goods into the country without paying the necessary duties or bring goods that are dangerous to our lives . It is our belief that the Customs would go a long way to eradicating this fraudulent act.
"The problem of unemployment will continue to constitute a social menace if we allow our efforts to be sabotaged by some selfish few who have nothing to give to the society. To give up, is to encourage these irresponsible importers and their collaborators to continue to undermine all our efforts to put the economy on a right footing. We are all leaving witnesses to the good job NAFDAC is doing in the foods and drugs sector. The Standards Organisation of Nigeria (SON) should take a cue from NAFDAC and stop the dumping of inferior goods in the country".