The Dangote phenomenon

On Saturday, October 10, 2015, Dangote Cement made history again as it commissioned its new 3-million-metric-tonnes-per-annum (mpta) cement plant in Mtwara district, Southern Tanzania. This doubles Tanzania’s annual cement production capacity to 6 million mtpa, making it one of the few African countries that have attained self-sufficiency in cement production. The new plant, which was described by Tanzanian President Jakaya Kikwete as the largest in East and Central Africa, took a record 24 months to build. The groundbreaking was held on May 27, 2013.

This commissioning is part of the company’s Africa expansion strategy, which had seen it commission similar plants in Ethiopia, Zambia, and Cameroun. These are part of the 16 cement factories being built simultaneously in 16 African countries by the company, and more plants would soon be ready for commissioning within months. 

Predictably, the event – a unique one witnessing Africa-to-Africa foreign direct investment – attracted government and business personnel not only from Tanzania and Nigeria, but also from neighbouring countries of Burundi, Rwanda, and Democratic Republic of Congo.

As the Tanzanian president rightly noted, Aliko Dangote is turning out to become Africa’s economic stimulant whose investments have improved economic stability and standard of living in the African continent. For President Kikwete, there can be no better way of rejuvenating and sustaining a nation’s economy if not through investment, which opens the door for job creation and opportunity for people to express their creative abilities.

Equally effusive in the praise of Dangote was Nigeria’s President Muhammadu Buhari, represented by the Kaduna State governor, Nasir El-Rufai. According to him, Dangote, who is now a key investor in the African continent and is playing a critical role in the economic development of Africa, is teaching African nations the important lesson of adopting an economic integration policy which will encourage Africans to invest in their continent rather than wait endlessly for the elusive foreigners to come and invest and help develop Africa.

We agree with the sentiments expressed above by the two leaders. Indeed, we feel Dangote fully deserves all the praises and accolades he has been receiving and there cannot be any danger of exaggeration. He is an incredible dreamer and risk-taker. We recall that he was one of the very few who bought into former President Obasanjo’s backward integration policy in a determination to become self-sufficient in the production of cement and other consumables that Nigeria spends huge fortune and foreign exchange on importing.

Whereas other importers scoffed at the former president and some even went to court to prevent the realisation of the policy, Dangote took the president by his words and proceeded with gusto to begin to invest in the manufacture of the products he had hitherto specialised in importing. So incredible was his vision that even while building the Obajana Cement Factory in Kogi State, and before he could master the Nigerian cement market then dominated by his competitor, he had started to dream, plan, and strategise on how to dominate the African cement market.

Sometime in 2007, Dangote visited Tanzania to share his dream of establishing an African conglomerate cement factory that will be producing cement simultaneously in most sub-Saharan African countries and was ready to put his mouth where his money was by building a $600-million factory in Southern Tanzania to alleviate the shortage in that country’s domestic cement supply. As Dangote himself related the story, they were pessimistic and didn’t believe him because his name did not yet ring a bell.

“They didn’t believe us at all. They thought I was one of these ‘Nigerian 4-1-9’ scammers who try to go and scheme people out of their money…or just one of these clever Nigerians who would come and be lying to them,” Dangote told Bloomberg in 2013.

Clearly, Dangote has lived up to his dream and is turning out to become the single largest investor in Africa even in the context of weak institutions, poor infrastructure and weak or failing political systems. For years, African economic theorists and analysts have lamented the poor and dismal level of inter-African trade and investment. Many would-be African investors have cited the reasons above as factors preventing them from investing in Africa.

Dangote must be commended for braving the odds. He is the perfect embodiment of the steely, go-getting Nigerian spirit. We urge other Nigerian industrialists, and especially politicians who love to stash their billions in foreign accounts, to emulate Dangote and invest those funds in Africa to generate jobs and stimulate economic growth.