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MD of VKS Groups, Mr Onur Kumral

MD of VKS Groups, Mr Onur Kumral

How businesses can tap into VKS contributions to Akwa Ibom economy

VKS has stationed itself as one of the biggest economic drivers in Akwa Ibom State.

byGodwin Akpan
March 12, 2021
7 min read

Blessed with abundant natural and human resources, coupled with a peaceful environment, Akwa Ibom State was ready for business alternatives other than civil service and over-dependence on one multinational oil company for its economic turnaround.

The field was ripe, but the harvesters were few. There was a need for cultivators with foresight.

A Turkish firm, VKS Group, in 2016, took the bull by the horn and kick-started an investment that would contribute immensely in changing the economic narrative of Akwa Ibom State, fondly called the Promise Land.

Hitting the ground running was not too difficult owing to the fact that Nigeria is one of Turkey’s largest trade partners in Africa, according to Daily Sabah, a pro-government Turkish newspaper.

For the people of the State, their reputation gave hope.

VKS Group, a global company with over 25 years of experience, is renowned for undertaking investments and projects around the world since 1981.

Over the years, VKS Group has successfully completed projects in various parts of the world, some of which are: Nigeria, Russia, Georgia, Turkey, Afghanistan, Uzbekistan and United Arab Emirates. The firm also has active operations and branch offices in Cameroon, Congo, Gabon, Gambia, Ghana, and Libya.

The Birth of JSM

How would it start its business in a State estimated to be less than 7 million people in population?

The first in their plough was the establishment of Jubilee Syringe Manufacturing Limited (JSM).

The VKS Group understood the dynamics of the market for syringes in Nigeria. Already, in the country, it is estimated that the requirement of syringe and needle is between 1.5 billion to 2 billion units per annum. Out of this requirement, data shows that an estimated over 1 billion units per annum of syringes and needles are being imported into the country, thus exposing the country to loss of huge foreign exchange.

Jubilee Syringe factory in Akwa Ibom

To bridge the gap, VKS Group reportedly invested $30 million as initial capital for the project in ONNA, Akwa Ibom State. The project commenced in July 2016 and was inaugurated by the Country’s Vice President, Yemi Osinbajo in September 2017. The factory sources its raw materials, polypropylene, from nearby Indorama Eleme Petrochemical in Port Harcourt, Rivers State, Nigeria.

This singular Investment has now placed Akwa Ibom State in the global map as the sanctuary of the largest Syringe manufacturing factory in Africa with a production capacity of over 400 million syringes per annum.

The firm is greatly tapping into the global syringe market expected to be worth over $1.64 billion by 2021 from a market value of $1.22 billion in 2016, at a Compound Annual Growth Rate (CAGR) of 5.98 per cent.

According to the Managing Director of JSM, Akin Oyediran, at a 100 percent capacity, the factory produces over a million syringes daily, ranging from 2 millimetres, 5 millimetres, and 10 millimetres.

In February 2021, the company hit 1.2 million syringes per day production out of the projected 1.5 million. With this development, JSM is envisaged to be addressing the syringe needs of the country. Yet, the investment on syringe was just the tip of the iceberg.

Kings Flour Mill.

The flour industry in Nigeria puts the value of Nigeria’s 3.2 million-tonne flour market at $2 million, with growth at 3.5 per cent a year. Curiously, the industry is dependent on imported wheat which is the main ingredient for flour. The United States Department of Agriculture Attaché Forecast estimates that Nigeria’s 2018-19 imports of wheat was at 5.4 million tonnes, while domestic production is around 60,000 tonnes.

Kings Flour Mill factory

Interestingly, Nigeria’s demographics underpin growth in demand for downstream food products, such as bread, pasta, noodles and biscuits, supports demand for the principal products of the milling industry — bread flour, pasta flour, noodle flour, confectionery flour and semolina.

Understanding this large market must have made VKS to establish Kings Flour Mill which has a 500 metric tons per day capacity in ONNA, Akwa Ibom State in August 2019.

In 2020, when the world was hit by the deadly COVID-19 pandemic, Kings Flour came handy. Its product and few others became the solution in ameliorating food scarcity in the county. At the same time, Jubilee Syringe became the saving grace, as hospitals across the country relied heavily on the syringe to treat patients. Yet, in all these firms established, there already existed the mother of them all.

VKS Nigeria Construction Limited

According to the company’s official website, VKS Nigeria Construction Limited incorporated in Nigeria as part of VKS Group has successfully completed projects with a cumulative worth of over $750 million to date.

VKS has achieved a wide reference list by successfully undertaking on turn – key basis in the diversified fields such as residential, commercial, industrial buildings, highway construction and infrastructure works, complete factories of various sorts as well as waste water treatment plants.

High rise building in Uyo built by VKS

Projects executed by the company in Akwa Ibom are: a 21-floor smart storey building in Uyo, the state’s capital, building of St. Gabriel Coconut Refinery, building of Jubilee Syringe factory, building of Kings Flour Mill factory, ongoing construction of Victor Attah International Airport terminal building, construction of 12,742Km Awa Iman-Asong-Ikot Edim-Ikot Emem Road with two Bridges in Onna and Mkpat Enin Local Government Areas, and Dualization Of 1 Km Awa- -Ikot Nkan Road With outfall drains in Onna Local Government Area.

One of the road constructed by VKS Construction Ltd

With all these exploits in the State, one does not need to be persuaded on the benefit the State has derived from hosting the company.

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How Akwa Ibom State has benefitted from VKS

VKS has stationed itself as one of the biggest economic drivers in Akwa Ibom after the state government and ExxonMobil. The multiplier effects on the state and its people have been enormous.

According to data from the Human Resource Manager of the Company, Mr. Ndiana Isong, VKS in less than five years operations in the State has in its employ 1,724 staff. According to the breakdown, VKS Nigeria Construction Limited has direct employment strength of 1,045, Jubilee Syringe staff strength (direct employment) is 3.64, while Kings Flour Mill is 315.

The MD of JSM, Mr Oyediran, says over 70 per cent of staff are Akwa Ibom indigenes.

What is more, the three companies under VKS group are reported to have contributed immensely to the Internally Generated Revenue of the State through the taxes they remit. As the prominent industries that have berthed the State under the current administration, their taxes may have contributed to the steady IGR growth in the State.

The book “Business in the Community” recommends more for a company that seeks to be a responsible business.

It notes: “The prosperity of business and society is inextricably linked. If every individual business strives to be the best it can be in all areas as a responsible business, there will be a positive multiplier effect that will benefit society, the economy and the environment. If businesses collaborate, they can have a greater impact upon key issues than if acting alone.”

In line with the recommendation above, the VKS Group through Jubilee Syringe had sent 12 Nigerian youth, mostly Akwa Ibom people within its employ for advanced training on injection machine operation, maintenance of mold and quality control among other technologies in Turkey, so that they can transfer such knowledge and technology to others.

Yet, that is not all from the company.

VKS Group appears to understand that to build and sustain brands that people could love and trust, they must focus not only on today but on tomorrow. Hence, in their Corporate Social Responsibility to host communities, VKS have been strategic in supporting communities and organisations with projects that will be profound to their lives. One recent case in point is the donation of academic materials to some public Schools in ONNA LGA of the State.

VKS Opportunities Not Fully Tapped

Akwa Ibom people appear not to have keyed into the full potentials that VKS offers.

The people appear not to have understood fully the business potentials available for them through VKS investments in the state.

For instance, wheat is the key raw material used in the flour Mill. This writer gathered that wheat used in the Mill is mostly imported.

The Chairman of the Akwa Ibom state branch of All Farmers Association of Nigeria (AFAN), Prince Bassey Inwang, says the establishment of Kings Flour Mill has opened another window for farmers in the State to go into massive wheat production, being the major raw materials for the mill.

Although he says that AFAN in the state had already acquired two hectares of farmland in Ibiono Ibom local government area of the state where they embarked on the cultivation of wheat under a pilot scheme. The reality, if truth be told, is that this project has not been followed through.

Agricultural experts insist that wheat can be effectively cultivated in Akwa Ibom if its cultivation is taken seriously. The experts say that such cultivators could attract billions of naira as key suppliers to Kings Flour Mill.

In addition, the distribution chain of the flour is reported to be dominated by businessmen from states in Nigeria’s South-east, while business people in Akwa Ibom State show less interest.

The Head of Sales, Kings Flour Mill, Frank Agaba, says the company is not to blame for the situation as they deal with only distributors who are interested and show seriousness in business.

“Our distribution is open to those who are interested to do business with us.

“There are Akwa Ibom people in Eket and Uyo who are our distributors. But we all know that in this business, the major people that have a strong desire and understanding of the running of this particular business are the Igbos. We deal with those who are serious,” he points out.

Akwa Ibom people are also yet to fully embrace the business opportunity in the syringe distribution. Out of the six pharmacies which sell Jubilee Syringes that were sampled by this writer, five among them say they buy their pharmaceutical products including the Syringes made by JSM from a distributor based in Lagos.

The MD of JSM, Mr Oyediran insists that the company is not to blame for that. He says “Distributorship is open for everybody. The form is available on our website. There, the company will simply give you the rules and regulations. When you are eligible and we see your commitment, we will gladly do business with you.”

VKS honoured for its foresight

The quality of products and impact of Kings Flour Mill, JSM and VKS to the Akwa Ibom society and Nigeria at large has not been unnoticed.

On March 5, 2021, the Nigeria Medical Association – NMA, endorsed Jubilee Syringe for producing the best syringes in the country and one of the very best in the world.

The President of NMA, Professor Innocent Ujah, while speaking on the occasion described the efforts made by JSM as unprecedented and worth commending.

According to Prof Ujah, “No one ever believed any good thing can come to Nigeria. Thank God that today Jubilee Syringe has changed the narrative. I must say here that Jubilee Syringe took risk coming into this sector, but today that risk has paid off”.

The man behind the VKS Group and the successes recorded therein is Mr. Onur Kumral, a Turkish businessman and investor. Mr. Kumral has been decorated and honoured for his job-creation effort in the State.

Two socio-cultural groups in Akwa Ibom State, Afe Mkparawa Annang, and the Supreme Council of Ibibio Youths, in 2020, honoured Mr. Kumral for contributing to the growth of the State economy.

Afe Mkparawa Annang, which presented Mr. Kumral with an Award of Excellence, said in a letter to him that they were aware that his companies have provided thousands of direct and indirect employment for Akwa Ibom people and contributed “hugely” to the Akwa Ibom’s Internally Generated Revenue (IGR) in the last few years.

They applauded him for finding the State fit for his Investments.

The letter from the Afe Mkparawa Annang signed by its President, Adede Uduak Akpan, called on the Akwa Ibom and the Federal Government to give special recognition to the efforts of the Turkish national so as to encourage him and other investors.

With the mutual benefits derived from VKS investments in Akwa Ibom State, it is the hope of many that the firm continues to operate responsibly while the State plays its role in giving them maximum support needed to thrive.

Mr Godwin Akpan, a journalist, writes from Uyo.

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