Aliko Dangote’s challenge to Nigerians
In a forum recently in Lagos, Aliko Dangote, president Dangote Group, admonished Nigerians to invest in their country. According to him, this is the only way Nigerians can attract foreigners to invest in Nigeria. Aliko is robustly qualified to come up with this golden advice.
This Nigerian business mogul has paid his dues with a business empire spanning several sectors of the economy – food, shelter, oil and gas, cement. Only recently, Dangote, who is Africa’s richest man announced he would lead a $7 billion investment in Nigeria’s power, petrochemical and mining sectors over the next four years. He said he would contribute $2.5 billion to these projects while $4.5 billion would be borrowed from reputable international lenders such as the International Finance Corporation (IFC).
He disclosed these at a send-off for the IFC Vice-President, Sub-Saharan Africa, Latin America and Caribbean and Western Europe, Thierry Tanoh, in Lagos. Dangote explained that the funds would be deployed in generating 2,000 megawatts of electricity. Dangote lauded the IFC for committing substantial funds to the Group’s businesses at a time when there was little or no credit given to African companies. He noted that as at 2006, IFC’s total loan portfolio in Africa was $150 million but has now increased to about $2 billion.
Aliko is therefore speaking from a position of strength and must therefore be taken seriously. He is ostensibly taking a shot at those Nigerians who stash away their monies in foreign countries. And most of those concerned are public servants and their private sector accomplices who have amassed wealth dubiously. Going by Aliko’s admonition, charity should begin at home.
Nigeria has all that can make it fly high. The opportunities are available in abundance. It has over 84 million hectares of cultivable agricultural land and has a robust deposit of solid minerals whose exploitation is unorganized and poor. It would be recalled that Obiageli Ezekwesili as minister of Solid Minerals during Obasanjo regime, produced a blueprint for the exploitation of Nigeria’s solid minerals which number 34. These solid minerals are widely spread across 450 locations in most of the 36 states of the federation, and the Federal Capital Territory (FCT). Each of these minerals is worth billions of dollars in revenue annually and hundreds of thousands of jobs. Investment opportunities in these two sectors are calling for local attention.
And only recently, a report released by Ernst &Young said Nigeria and Ghana are among the three fastest growing markets in the world. According to this Ernst &Young’s quarterly Rapid-Growth Market Forecast (RGMF) “There is a mixed picture emerging across the world. Although Asia is likely to lead the way, Africa remains resilient overall, with Ghana and Nigeria among the three fastest growing of the RGMs this year.” It said in the next two years, both African nations are estimated to be among the fastest 25 leading rapid-growth in the world. The report also indicates that the power sector holds the key to Nigeria’s economic growth and development, asserting that economic expansion in the 25 leading Rapid Growth Markets (RGMs) has started to slow sharply since the beginning of this year but this will only be a temporary blip.
However, Co-leader of the Emerging Markets Centre at Ernst & Young, Alexis Karklins-Marchay was quick to stress that “although slower expansion in the rapid-growth markets is likely this year it will only be a blip and we will see a return to significant growth towards the end of the year. Soaring domestic demand in economies starved, for some time, of investment and consumption will offer business exciting new markets for goods and services in the years ahead.”
“Despite the slowdown in growth experienced by the RGMs at the beginning of this year they will begin to bounce back towards the end of this year and in 2013. The ability to relax policy to boost growth, a growing middle class to aid consumer spending and a strong rise in FDI flows will ensure continued growth well into the future”, he added.
According to Bisi Sanda, a Senior Partner, Transaction Advisory Services, Ernst & Young, Nigeria, the power sector is pertinent to Nigeria’s economic growth and development.
He said “If the government of Nigeria completes its privatisation of the power sector assets in 2012, it will provide much required fresh breath to the much delayed reactivation of stimulus of the manufacturing sector, including the reactivation of over 100 textile mills that closed down or relocated from Nigeria between 2000 and 2007. Power is an enabler in Nigeria.
“I hope Mr President and his team are reading or listening? Power is essential for local and foreign businesses to start and grow. Government must fix power and by so doing facilitate Nigeria’s investing in their economy”.
Posted on August 30, 2012, in News and tagged Africa, Aliko Dangote, Aliko Dangote’s challenge, International Finance Corporation, Obiageli Ezekwesili, Sub-Saharan Africa. Bookmark the permalink. Leave a comment.