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Dangote Fertilizer Complex: Matters arising

Ebonyi bullish on investment, rakes in N200m from fertilizer plant

The Nigerian president, Muhammadu Buhari, was visibly elated on March 21, 2022, when he performed the ground-breaking ceremony that signalled the commissioning of the $2.5-billion Dangote’s fertilizer plant.

The ceremony was held at the budding Lagos Lekki Free Trade Area, an emerging industrial hub that has already seen an influx of notable investments in recent times. The fertilizer plant is part of the $17.5 billion Dangote Petrochemical Complex due to be commissioned later this year.

There are many angles to that epoch event in Lagos. First, it shows the amount of investments that sub-national governments in Nigeria can attract given the right business environment.

Moreover, there is the impact the commissioned fertilizer plant will have on Nigeria, which incidentally is Africa’s largest agricultural landscape. And third, there is the need for government at federal and state levels to develop the infrastructural stock in the area, in anticipation of rapid urbanisation and industrialisation.

One of the reasons for low food security rankings in Africa is due to the low usage of fertilizers. For instance, although Nigeria’s arable land is expansive, yet in most places, nutrients such as phosphorus, nitrogen and potassium are deficient

Investment attraction goes beyond rhetoric as local and international investors could easily figure out how much seriousness a government attaches to investment facilitation and promotion. In Nigeria today, many state governments that attach much importance to removing structural bottlenecks that drive investments away have been rewarded with huge inflows of notable investments. A case in point is the tremendous progress the Lekki Free Trade Zone in Lagos has recorded.

The commissioning of the fertilizer plant is also timely as Africa is one of the continents threatened by food insecurity. On the latest ranking of the Global Food Security Index (GFSI), Algeria and Tunisia are Africa’s best with 63.9 and 62.7 points to rank 53rd and 55th globally. These countries are followed by Morocco (57th) and Egypt (62nd). The best ranked country in sub-Saharan Africa is South Africa (70th). By contrast, Nigeria is ranked 97th with 41.3 points.

One of the reasons for low food security rankings in Africa is due to the low usage of fertilizers. For instance, although Nigeria’s arable land is expansive, yet in most places, nutrients such as phosphorus, nitrogen and potassium are deficient. Worse still, the application of fertilizers falls below the level of usage in other emerging markets.

According to the World Bank data on fertilizers usage, Hong Kong (China) tops the usage of fertilizers worldwide with 3,573.91kg/ha. It is followed by Malaysia, 2,106.45kg/ha; Bahrain, 1,990.53kg/ha; New Zealand, 1,895.29kg/ha; Ireland, 1,544.89kg/ha, and Kuwait, 1,059.48kg/ha.

Egypt uses the most fertilizers in Africa per hectare of arable land. According to the data, it uses 596.12kg/ha. It is followed by Seychelles whose farmers use 515.67kg/ha; Mauritius, 187.11kg/ha, and Botswana, 89.57kg/ha.

Nigeria and majority of other African countries use less than 80kg/ha compared with the global average of about 200kg/ha. Specifically, Nigeria uses 19.74kg per hectare of arable land, slightly below the average usage in sub-Saharan Africa of about 20kg/ha.

The immediate foregoing may well explain why hunger is prevalent in this part of the world. Undoubtedly, the coming on board of the Dangote Fertilizer Plant will boost food production in Nigeria, West Africa, and Africa as a whole.

Read also: Food security, foreign exchange gains seen for Nigeria in Dangote fertiliser

Its impact will also be felt in employment generation from wholesale to retail, as well as in transportation, storage and other logistics. A good example has been set by Dangote Cement, which has created thousands of direct and indirect jobs in Nigeria.

However, there is need for government and other seed producing companies in the country to step up their sensitisation efforts. This is the time to feel the impact of government’s extension workers.

It will not be out of place to map out the entire Nigerian landscape by fertilizer usage, using crop and soil compositions. This is necessary because majority of the smallholder farmers are less educated, and getting them to know the specific periods and types of fertilizers to apply will help increase yield per hectare, and in turn enhance food production and income generation.

Meanwhile, the commissioning of this unique project has raised fears among residents within the fertilizer complex and adjoining towns. This is because of the likelihood to create the spectre of Apapa Ports’ gridlock in the Lekki axis of Lagos. The current network of roads in the Lekki corridor of Lagos, and those extending to Epe is not enough to carry the number of trucks that will be plying the roads now that the fertilizer plant has been commissioned. The roads will get more busy by the time the petrochemical complex is commissioned later this year.

The gridlock in Apapa has affected a number of businesses that have been forced to relocate from their areas of impact. The Lekki corridor has attracted huge private sector investments into the real estate sector, general trade, and logistics. These investors will be highly disappointed if the Federal and Lagos State governments should allow the ‘Apapa treatment’ to befall them. Above all, we are therefore making an urgent call for the development of additional infrastructure that will accommodate the upsurge in road usage in that axis of the state.

Meanwhile, we cannot but offer our congratulations to Aliko Dangote and the Dangote Group on this particular feat. Our fervent hope is that this particular project will go a long way to ensure Nigeria’s much needed development in the area of agriculture and employment generation.