The President of the Dangote Group, Aliko Dangote, has attributed Nigeria’s industrialization challenges to unstable electricity.
He noted that running a business abroad is 30% cheaper than in Nigeria and other African countries due to the reliable power supply in developed nations.
Dangote made this remark while hosting Zambia’s Minister of Energy, Makozo Chikote, at the Dangote Refinery in Lekki, Lagos.
He revealed that the group’s most profitable cement factory is in Ethiopia, thanks to its stable electricity supply.
Dangote stated that before venturing into industrialization, he conducted research to understand why previous attempts, including those by his grandfather, had failed.
He discovered that one of the key challenges was the lack of stable electricity.
“If there’s no power, there won’t be growth. For example, anything I’m going to do abroad will cost me maybe 30 per cent cheaper than here, because abroad is plug-and-play. You just go, no infrastructure construction. You just build a factory, and you connect to the network; that’s all.
“That’s why, if you look at it today, I tell you that our most profitable cement factory is in Ethiopia because there’s no investment in power. They gave us power at the same rate for five years. So, we plan, it’s a one-price electricity continuously,” he expounded.
Dangote explained that in Nigeria, his group had to invest heavily in generating electricity for the refinery and other factories—something unnecessary in developed countries.
He also attributed Nigeria’s industrialization challenges to inconsistent government policies.
“One of the problems of industrialisation is inconsistencies in government policies, where, just like a footballer, you’re about to score the goal, and the government will remove the goalpost and point behind you that the goalpost is behind. So, you have to now turn. Once you turn back, you have a lot of challenges to get to that goalpost again,” he stated.
The business mogul emphasized that reducing policy inconsistencies requires educating the government on the benefits of industrialization.
He noted that when industries thrive, the government benefits as a major stakeholder through tax revenues.
“For example, in our cement, every N1 we turn around, 52 kobo go to the government in various taxes—30 per cent corporate tax, 7.5 per value-added tax, two per cent for education, and one per cent,for health. When money is being made in the company, if you want to take the money, all the shareholders will have to pay the government 10 per cent as withholding tax again. This is for the Federal Government. When you add the state and the local government, everything now is something else,” he noted.
Dangote stressed that when a business shuts down, the government is one of the biggest losers.
