INSIDE AFRICA

We represent a large group of Nigerian advocates and journalists who have common interests that include identifying issues that stand in the way of economic progress in Nigeria. The government has been fighting a fierce battle in handling corruption and other illegal practices whilst seeking further foreign investments into key sectors to accomplish rapid economic progress.

More than four years after their illegal deportation, the Vaswani Brothers, Sunil, Haresh and Mahesh were finally cleared officially of any wrong doing by the Federal Government of Nigeria.

In an official letter dated December 12, 2007 addressed to the Vaswani brothers, Major General A Mohammed (Retd) CFR, GCON, Chief of Staff to the President says “after a careful study of your case as presented, and, after appraisals and analysis of submissions by the various relevant government agencies, and in the spirit of justice, fairness and the observance of the rule of law, Mr. President has approved the revocation of the deportation order that caused your deportation from Nigeria in May 2003.” The letter further goes on to say “consequently you are as from now being given an unfettered right of return to Nigeria should you choose to do so, just as all relevant agencies concerned have been informed of this development”.

We at the Nigerian Advocates have taken the opportunity to conduct a thorough analysis of the whole episode that started in May 2003 when the billionaire Vaswani brothers were subject to a shocking deportation, stunning millions of their Nigerian customers and international partners. Our earlier report had elaborated on the various aspects of the frivolous and false charges framed against them by parties unhappy with their progress.

We are pleased to note the bold gesture (although inevitable) by the Yar’Adua administration in revoking the unjust deportation after a careful examination of facts. The action represents an excellent development that would lead to sparking rapid economic progress through gradual elimination of monopolies that dominated the Obasanjo regime.

It is now an open secret that the deportation of the Vaswanis was engineered by parties running a highly profitable cartel, maintaining high prices in the market and accumulating billions of personal wealth in the process. The cartel exercised significant influence over the governmental policies on imports, tax waivers, rebates and other concessions that were often unfairly bestowed upon them at the cost of the Nigerian consumer. Prices of essential products like rice, wheat, steel, cement and sugar sky rocketed despite the slew of concessions, as the monopolies grew their businesses exponentially.

The Vaswanis have always remained competitive in the market through achieving economies of scale arising from their global procurement processes, supply chain management (18 countries) and supplier relationships. The cartel considered them as a potential threat to their monopoly and figured that the only way to get them out of the equation would be to engineer false and frivolous charges, and generating a hasty deportation order from powers under influence. The refusal of the Vaswani brothers to take part in cartels of any description is also reported to be the primary reason.

The monopoly was also very wary of the Vaswanis’ plan to set up large industrial plants in the neighbouring Ghana. Under the ECOWAS treaty these plants would have been able to penetrate the Nigerian market thereby potentially breaking the monopoly to the detriment of the cartel. To deal with this ominous threat the cartel made similar moves in Ghana, initiating sponsored smear campaigns in the media leading to the prohibition order issued by the Ghanaian government against the entry of the Vaswani brothers. Ironically the Ghanaian government had no basis to do this except to blindly follow the actions of Nigeria and attendant media coverage.

The Vaswani brothers have well set businesses and investments in Ghana for many decades. Their reputation has been clean and untainted with the Ghanaian consumers and the government. For instance, In an effort to encourage voluntary declaration of VAT and NHIL by enterprises, the Ministry of Finance and Economic Planning instituted awards for payments and compliance across business sectors.

Early September 2006, the company owned by the Vaswanis - Stallion Industries and Investments Limited (SIIL) won the Platinum Award recognizing their initiative to be law abiding corporate citizens. They have remained one of the highest tax payers in the country much like in Nigeria, while operating a business that is fair and equitable to consumers.

Apparently realizing the mistake the Ghanaian government immediately reversed their prohibition order in September 2003.

The business interests of the brothers have been thriving in Ghana with further investments large sized projects including new properties purchased estimated at 18billion Cedis in 2007. With the issues now cleared, one can expect hectic activity on the industrial front in Nigeria, Ghana and the entire West African belt.

The deportation in Nigeria has also drawn widespread criticism and anger amongst the professional and business communities. The top tier legal experts had repeatedly voiced concern in public over the total lack of due process in the whole episode. Some notable legal/judicial personalities including His Excellency Prince Bola Ajibola CON (Former President World Bank Administrative Tribunal and Former Judge, International Court of Justice) viewed their strong dissent to the way that the Vaswani brothers were treated after a commendable record in Nigeria. On several occasions, he petitioned the ex President Obasanjo to restore justice to the innocent victims of the cartel, as it was demonstrably clear that the investigating agencies failed to unearth any evidence that would have justified the deportation.

Obasanjo’s own Presidential and personal attorney and leading legal practitioner Chief Afe Babalola OFR, CON, SAN, LL.D (of Supreme Court of Nigeria) ironically felt so strongly about the mistreatment to the Vaswanis, that he took up representing them at the courts. He also on numerous occasions pleaded with the Obasanjo administration to reverse the wrong action but in vain.

Keeping with his growing reputation as a strict follower of due process and the rule of law, President Yar’Adua acted in a fair manner, carefully examining all facts in consultation with various ministries and legal advisors and finally issued his orders of revocation in December 2007.

The official view of the Yar’Adua administration on the Vaswani case was aptly articulated by the Special Adviser to the President (Communications), Mr. Segun Adeniyi, by Deputy Bureau Chief (Abuja), MADU ONUORAH:

(http://ndn.nigeriadailynews.com/templates/?a=13234&z=5)

“The case of the Vaswani brothers is a long one but I can confirm that it is true the President has written that they be allowed to come back to Nigeria to continue their business because they committed no crime. The President sought the opinions of all the relevant agencies of government and the returns were that there was no legal basis for the deportation. The Vaswanis were neither tried nor convicted of any crime before they were deported. So, when they petitioned and the issues were examined, the President decided they should be allowed to return to continue their business in Nigeria. The decision had nothing to do with the former President. “

Actions against abolition of monopolies are moving at a rapid pace. Early 2008, President Umaru Musa Yar'Adua has lifted the ban on the importation of bagged cement into the country. The lifting of the ban, according to the government, is with a view to bridging the deficit of 11.5 million tonnes in the supply of cement, which has been recurrent in the industry in the last few years. The annual demand for cement is estimated at about 18 million metric tonnes. However, the cartel has been controlling the supply, declaring large uninstalled/false capacities, whilst importing cement for bagging at attractive duties. The prices were maintained at the high level a coordinated effort by the key players.

With the return of the Vaswanis the Yar’Adua administration has secured a strong and willing ally with professional competence to break monopolies while delivering products at a fair pricing and good quality for the Nigerian people.

We at the Nigerian Advocates, stand vindicated.

Other Reports

VASWANIS – The Illegal Deportation  [ Click on link to read more...]

Nigeria – The New President and his impact on Monopolies in Nigeria  [ Click on link to read more...]

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