Nigeria’s steel industry received a major boost as the Director-General of the Nigeria–China Strategic Partnership (NCSP), Joseph Tegbe, applauded the proposed $550 million investment by Inner Galaxy Steel Company for the establishment of a new integrated steel plant in Ogun State.
The planned facility, expected to produce 2 million metric tons (MMT) annually, marks one of the largest single commitments to the Nigerian steel sector in decades.
Industry watchers say the development could significantly reduce the nation’s dependence on steel imports while creating jobs, driving technology transfer, and boosting foreign direct investment inflows.
Inner Galaxy Steel, which already operates a flagship facility in Abia State, currently produces about 600,000 metric tons per year.
The company recently announced its intention to scale up operations at the Abia plant to 1 MMT annually through operational upgrades.
The new Ogun State project, however, is considered a game changer.
Developed in phases, the facility will tap into locally available iron ore, aligning with President Bola Ahmed Tinubu’s target of achieving 10 MMT in national steel production annually under the government’s industrialisation agenda.
The financing structure of the project allocates $450 million from Chinese partners and financial institutions while $100 million will be provided by Nigerian stakeholders, underscoring a collaborative funding approach between both nations.
Beyond steel, the DG noted that Inner Galaxy’s operations have already stimulated the growth of an industrial cluster in Abia State. The cluster includes:
Neway Power Technology Company Ltd, producing about 4 million car batteries annually.
Jiu Xing Integrity Industries Limited, assembling and fabricating trailers from CKD and SKD kits.
Starich Recycle Technologies Company Limited, focusing on plastics recycling and manufacturing.
Analysts believe the Ogun facility could anchor a similar cluster, further accelerating Nigeria’s manufacturing diversification and strengthening supply chains across multiple sectors.
Industry analysts estimate that the new plant could directly and indirectly create tens of thousands of jobs, from construction and steel processing to logistics and downstream industries.
It also promises to reduce Nigeria’s heavy reliance on steel imports, which currently cost the country billions of dollars annually, while improving competitiveness in infrastructure, housing, and automobile production.
According to Tegbe, the impact of the investment “extends beyond steel production.” He emphasized that the project would fortify Nigeria’s industrial base, deepen international partnerships, and support the Renewed Hope Agenda of President Bola Tinubu, which prioritizes infrastructure, industrialisation, and job creation.
The investment further reflects the growing strength of Nigeria–China bilateral cooperation.
China remains one of Nigeria’s leading partners in infrastructure financing, with billions committed across power, transportation, and energy projects.
With Nigeria seeking to diversify its economy away from oil dependency, experts see the steel industry as a cornerstone for industrial transformation.
By leveraging partnerships such as the one with Inner Galaxy, the country could position itself as West Africa’s industrial hub, supplying steel and manufactured products across the continent under the African Continental Free Trade Area (AfCFTA) framework.
Nigeria’s steel industry has long been constrained by underinvestment, policy inconsistencies, and heavy reliance on imports.
The collapse of Ajaokuta Steel Company and delays in other projects left a huge gap in domestic supply.
If successfully executed, Inner Galaxy’s Ogun State plant could represent a turning point by re-igniting confidence in large-scale industrial ventures within the country.
As Tegbe put it, “This investment is about building an ecosystem of resilience, innovation, and opportunities that will shape Nigeria’s economic future.”
With $550 million already on the table and strong support from Chinese and Nigerian stakeholders, the proposed Ogun steel plant could become a cornerstone of Nigeria’s industrial revival — a milestone capable of rewriting the story of the nation’s steel industry.