On February 9, 2012- barely one week from now-President Goodluck Jonathan will lead other Nigerians to usher in new era for the country’s economy, as the Dangote conglomerate officially opens its new factory that will mark the end of cement importation into Nigeria.
The factory located at Ibese, Ogun State, is expected to commence the production of six million metric tonnes of cement and add some 10,000 direct and indirect jobs into the Nigerian economy.
Dangote conglomerate currently provides about 40, 000 jobs and pay about N50 billion in tax annually. Ironically, hundreds of local and foreign companies have closed shop, while others are relocating to Ghana, owing to what they described as security and infrastructural deficit in Nigeria.
According to the Manufacturer Association of Nigeria (MAN), 834 firms folded up in 2009 alone, and many more subsequently, due to hostile operating environment. Despite these oddities against investors, the Dangote Group is buoying Nigeria’s economy with yet another 10,000 fresh jobs. This is so because the Dangote Group says it believes in Nigeria.
The conglomerate’s president Aliko Dangote had said: “I have more confidence in Nigeria than in any other country. I will keep investing.”
Certainly, this is good news to the 20million Nigerian youth who are unemployed, and to the Federal Government, whose constitutional responsibility is to cater for the wellbeing of citizens.
Currently, Nigeria’s unemployment rate of 41.6% is about the highest in the world; more than the 25% average rate for North Africa and the Middle East which have been shaken by civil unrest spearheaded by unemployed youths.
Alhaji Dangote had told the nation that his organization was taking up the challenge to lead the way in that effort as making the nation self-reliant in the cement production as the nation was losing a huge sum in foreign exchange on import.
According to him, the desire of the Dangote Cement is to ensure the country not only move away completely from export of certain commodities, of which cement is one, but to strengthen the local production capacity to make her exporting nation and increase her foreign reserves.
He had said: “Our long term ambition is to develop 46 million metric tons of production and terminal capacity in Africa by 2015. We want to become a truly pan-African champion in the sector, capable of competing globally with the largest cement companies in the world.”
Dangote’s current project in cement manufacturing is to further extend his consortium across Africa. Its cement investment which has generated revenues of US$3 billion in 2010, already reaches 14 African countries, including: Benin, Cameroon, Cote d’Ivoire, the DRC, Ethiopia, Gabon, Ghana, Liberia, Senegal, Sierra Leone, South Africa, Tanzania, and Zambia.
An industry analyst had pointed out that “considering that Nigeria’s cement need is between17 to 19 million tons per year, by implication, with the coming on stream of Ibeshe, what Dangote Group alone will be producing will be far more than the country’s demand. That will set the pace for exportation of our products which will lead to increased products, more revenue for the company and better returns for the shareholders.”
That the Dangote Cement is the most capitalised company on the floor of the Nigerian stock market is no news.
In spite of the downturn that saw the Nigerian Stock Exchange (NSE), All-Share Index closed 2011 financial year with a decline of over 16 percent, Dangote Cement equity ended the year with a market capitalization of N1.716 trillion.
It is expected that by the second quarter of this year, the total cement production in Nigeria would have reached 20 million MT, above the 18million average consumption demand, and Dangote cement would account for 70 per cent of it.
In the same vein, the Dangote Group has since signed an agreement with Saipem Contracting Nigeria Limited for the commencement of work on Fertilizer Company in Edo State. With this, the Dangote fertilizer project promises to provide additional 7,000 jobs.
With the agreement, Saipem is to build for the Dangote Group, a fertilizer plant for the production of 7.700 MTPD of granulated Urea, (two trains with a production capacity of 3,850 metric tons each per day). The plant will be the largest in Africa as its closest competitor has installed capacity of only 1,000 metric tons per day of Ammonia and 1,500 metric tons per day of Urea compared with the Dangote plants of 2,200 metric tons per day for Ammonia and 3,850 metric tons per train per day of Urea.
The group’s Savannah Sugar Company Limited (SSCL), with staff strength of 5,472, is the second largest employer of labour in Adamawa State. Last two years, N25 billion was invested into the company.
The Dangote’s Obajana cement factory also has about 1,500 work force. This is apart from other businesses and banks that grow around it. It is the largest cement factory in West Africa.
Last year, the company created another 15,000 jobs when it acquired 5,000 trucks in its effort to bring down the price of cement.
With the new development, capital market investors are now jostling for Dangote Cement shares, describing it as ‘hot cake.’
It is an axiom that the contribution of the Dangote Group to the economic wellbeing of Nigeria cannot be overemphasized as just last year the group expended N15.5billion in Corporate Social Responsibility to various communities in Nigeria.
Alhaji Dangote is the Chairman of the Federal Government job creation committee. He is also member of the national economic management team. He was coffered with the second highest national honour of GCON by President Goodluck Jonathan last year.
In justifying such an unprecedented and huge contribution, Alhaji Dangote had said: “In any environment where all you do is profit making and you don’t put anything back. It is like feeding a cow and not feeding it well to have better quality milk.”
Abubakar writes from Central Business District Abuja
[email protected]
