Lagos Deep Offshore Group, Samsung Reach Settlement, Truce Could Unlock $300 Billion Investments – Arise News
Lagos Deep Offshore Logistics Base (LADOL) and Samsung Heavy Industries (SHI) Nigeria on Wednesday announced the end of their five-year hostility, which had cost the economy a substantial fortune in jobs and revenue. The historic truce, achieved through the Alternative Dispute Resolution (ADR) mechanism, is expected to unlock more than $300 billion in foreign direct investment (FDI) into the country.
The respite came following the formal signing of a Memorandum of Understanding (MoU) on subletting in terms of settlement and service agreement between the two parties. This ended the dispute that arose between Samsung and Ladol in 2018.
Attending the historic ceremony were stakeholders from the country’s economic zones, including the Managing Director/Chief Executive of the Nigeria Export Processing Zones Authority (NEPZA), Prof. Adesoji Adesugba; Acting Director General, Nigerian Ports Authority (NPA), Mr. Mohammed Bello Koko.
Others were Executive Chairman/Founder of LADOL, Chef Ladi Jadesimi; former Managing Director of Samsung Heavy Industries (SHI) Nigeria, Mr. Jejin Jeon; and Chairman of the Nigerian Economic Zones Association (NEZA), Chief Oluwatoyin Elegbede.
Adesugba said the dispute had shut out investments worth over $7 billion and 3,000 jobs, adding that the peaceful resolution would also provide direct employment opportunities for over 10,000 Nigerians.
He said: “We are very pleased to have been able to carry out the directive of the President that we must, as a national emergency, ensure that this dispute is stopped.
“We celebrate investments worth this amount being unlocked in the Nigerian economy and hope that we will continue to monitor what is happening between Samsung and LADOL to ensure they live up to the spirit. what they signed today.
“We anticipate that we will start to see visible results in the next few months, not for another year; we will start to see jobs and different projects coming into the country.
“We were in Seoul, and they promised us that if we could solve this problem, Nigeria would have more companies coming from South Korea to invest in the Nigerian economy. We are very optimistic that this is going to be a win-win situation. -winner for investors and Nigeria.
He also attributed the resolution of the five-year trade dispute to the establishment of an ADR unit when he took office, in collaboration with the National Dispute Resolution Center of the Abuja Chamber of Commerce (ACCI). .
Adesugba said, “What NEPZA did was as soon as I took over my job last year, we established the NEPZA Alternative Dispute Resolution Centre. And you can see that’s the result of what we did.
He commended President Muhammadu Buhari for his insistence on unlocking investment in the country as well as the Minister of Industry, Trade and Investment, Mr. Niyi Adebayo, for his role and leadership in ensuring the success of intervention.
Also speaking on the occasion, Koko said the dispute, which had previously defied multiple attempts at resolution, had resulted in the loss of government jobs and revenue.
He said: “In the past three years, no activity has taken place there (economic zones). There has been loss of economic values and loss of jobs. So we’re glad it’s been resolved today. Both parties have agreed to work together and in the future, if there are any disputes, the NPA will be involved.
“We would like to thank President Muhammadu Buhari who took the steps that led to the resolution of this dispute. Today is a happy day and it is good for the nation and it would ensure that investor confidence improves in terms of foreign direct investment in Nigeria.
Amid the imbroglio in 2020, Buhari had issued a directive to the NPA to return land taken from Ladol to the company, but the order was not implemented.
“Today we officially implement this directive. And the main part of this is to make sure that both parties solve their problem and that the activities on the Ladol site actually start,” Koko added.
In an interview with THISDAY, Jadesimi confirmed that the disagreement between LADOL and Samsung has finally been resolved for the benefit of the Nigerian economy.
He said, “Today’s meeting aims to end a dispute between Ladol Group and SHI, which has been dragging on for a while and has become critical for it to be settled. And now it’s completely solved.
“The main thing is to be able to resolve it peacefully for a much stronger joint venture in the future. It was a commercial dispute, but the main thing is that it was completely resolved for the benefit of the Nigerian economy.
For his part, Jeon said resolving the crisis will foster greater collaboration with all parties to achieve better performance in the industry.
He said the dispute has further strengthened and strengthened SHI’s relationship with its partners.
Jeon added, “Based on this experience and application, I am confident that Samsung and Ladol, under the guidance of relevant government agencies, will continue our collaboration for the growth of the industry and our business.
“Our mission will not damage any relationship with the Nigerian government and our industry.
“So based on our 10 years of experience, good and bad experiences, including those disputes, but I think through those disputes, our relationships with our partners have been much more strengthened and strengthened.”
Jeon also expressed his regrets over what happened in the past decade, expressed his confidence that with God helping the industry will see better improvement in the future, adding that Samsung will be part of Nigeria’s development. .
The Chairman of the Nigerian Association of Economic Zones (NEZA), Chief Oluwatoyin Elegbede said, “The Nigerian Association of Economic Zones is very pleased with the resolution of this issue as it is a matter between two of our members, Ladol and SHI. It’s been going on for a decade and we just thank God it’s been resolved today.
Essentially, the land lease dispute between LADOL, an indigenous company, and SHI, a Korean company, began in 2018, with the alleged unilateral revocation by the NPA of the presidential approval of the 25-year lease granted to Ladol and its replacement by a direct lease in 2019.
NPA, by this action, claimed to have taken part of the land from Ladol and leased it to Samsung.
The controversy led to the closure of business activities in the area by the two companies with more than 3,000 job losses, the shutdown of economic value chains and other losses that stifled the free flow of income to the government and new investments.
Given the relentless dislocation of the dispute over the country’s industrialization process, another presidential directive was issued in 2020 to reaffirm the 2018 presidential approval of land in Ladol.
However, the latest presidential directive was also dropped.
Worried about the protracted dispute, Transport Minister Mr. Chibuike Ameachi waded in. Amaechi tasked Koko with ensuring that the presidential directive, as communicated by the Attorney General of the Federation (AGF), is implemented without further delay.
But two other issues resolved were based on SHI MCI FZE’s sublease agreement with a LADOL subsidiary, Global Resources Management Limited (GRML) and SHI MCI’s license to operate as a free zone enterprise within of the free zone of LADOL.
By this settlement, all cases filed in various courts by both parties have been withdrawn and the stage is set for the start of a large-scale operation in this business ecosystem.
The terms of the settlement were agreed in January and the lease and sublease agreements were officially signed yesterday.
James Emejo in Abuja