LAST Sunday, I participated in the Toyin Falola Interview Series, the topic of which was: “Dangote, Oil and Power in Nigeria.”
It is a widely followed intellectual debate forum streamed on zoom, Facebook, YouTube, X and a number of radio stations. The Panel had Professors Victor Oguejiofor Okafor, Mobolaji Ebenezer Aluko, Ehiedu Goodluck Iweriebor, Jibrin Ibrahim as well as governance scholar, John Onyeukwu, and labour veteran Comrade Owei Lakemfa.
The chief host, Professor Toyin Falola had convened the forum in recognition of Dangote Refinery’s well-deserved praise for this historic intervention that completely changed Nigeria’s industrial destiny. It is for this reason that I became a fan of the impact Dangote industries are having on Nigeria’s industrial landscape.
The complete range of product delivery from petrol, diesel and aviation fuel to plastics and fertilisers is creating a huge industrial base for the country. The icing on the cake is that already, these products are being exported to the United States, Brazil and even Saudi Arabia building up our exports and dollar reserve. With Dangote, the African renaissance is clearly in motion. There is no surprise that the image of Dangote in Nigeria today is very positive and even the sceptical me has become a fan.
I have not always been a Dangote fan. I actually found him to be an unscrupulous player when he became a major commodities importer and distributor in the 1980s. It was a time when public corruption was organised around import licenses for what were called essential commodities. Then came the Structural Adjustment Programme (SAP) and the libertarian of imports.
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Dangote became the winner of the new process by rapidly outplaying his rivals in the importation of these essential commodities – sugar, salt, wheat flour, rice and cement. He followed a well-known strategy of lowering his prices to destroy the opposition and raising prices unfairly when he achieved the position of the monopoly player. He therefore came into the narrative of Nigerian business as a ruthless player determined to eliminate all competition so that he could exploit the masses with reckless abandon. I cannot vouch for the accuracy of this narrative but that was the street credibility he had at that time. I therefore had a very negative view of his business operations.
I have heard former president Obasanjo take credit for transforming Dangote from an importer into a producer that developed a vast industrial complex in Nigeria and subsequently in Africa. He said he posed the question to Dangote on what it would take to transform from an importer to a captain of industry and the response was a no brainer. It can only happen if he receives state support to make production in Nigeria as profitable as the import option through incentives and protectionist measures.
Obasanjo says he provided that support. There is no surprise, therefore, that the public perception of Dangote was for a long time as someone who built his empire by exploiting state resources. It would be very useful for our research community to probe the evolution of Dangote’s ascent as a captain of industry.
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The important thing he has done for the country, however, is to bring back into reality the ambition of the Second National Development Plan of import substitution industrialisation of Nigeria. From the scandal of the cement import armada of the 1970s when hundreds of ships loaded with cement were imported at the height of the oil boom and the government discovered that our ports could not unload them leading to a pile up that cost the country huge losses. Since then, we have moved to self-sufficiency in cement production in addition to a significant level of exports to neighbouring countries. I have travelled to Benin and Niger Republics by road and felt a sense of pride on seeing long queues of Dangote trucks exporting our cement.
The establishment of the Dangote refinery, one of the largest in the world with capacity for processing 650,000 barrels of crude daily, is a huge turning point for Nigeria, indeed for the continent. Already, some European refineries are closing down as Dangote is taking over their business. It is a historic intervention in Nigeria’s industrial destiny as we move from one of the world’s biggest importers to an exporter ending decades of structural dependence with the associated crisis of supply disruptions and fuel queues.
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The complete range of product delivery from petrol, diesel and aviation fuel to plastics and fertilisers is creating a huge industrial base for the country. The icing on the cake is that already, these products are being exported to the United States, Brazil and even Saudi Arabia building up our exports and dollar reserve. With Dangote, the African renaissance is clearly in motion. There is no surprise that the image of Dangote in Nigeria today is very positive and even the sceptical me has become a fan.
After a long period of hostility, the Tinubu administration appears to be warming up to Dangote with the recent presidential directive to place a 15% tariff on imported fuel. I do hope that it is an attempt to provide some protection for this vital industry that is so important to our economy. Dear Dangote, I believe that you are right in your attitude that the struggle continues.
Dangote himself has said that the refinery project has not been easy and he has confronted blockages and sabotage at every twist and turn. I remember the famous de-marketing press conference by the bosses of the National Petroleum Company under Mele Kyari declaring that the new refinery was producing sub-standard products only to find out later that their standards were among the highest in the world. They have had to import crude from other countries because NNPCL would not sell to them what they need. At the same time, the profiteers of oil importation in the country have gone to great lengths to place obstacles between the refinery and the Nigerian market. Dangote has shown himself to be a resilient fighter and has been addressing the numerous challenges as they come along.
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One of the most serious challenges he faced was the nationwide strike declared by the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN). The labour union grounded operations at key oil and gas regulatory facilities, including the NNPC, the NUPRC and the NMDPRA, in response to the sacking of 800 workers by Dangote Petroleum Refinery and Petrochemicals after they joined PENGASSAN. The refinery’s management had accused the sacked workers of sabotage. PENGASSAN accused the refinery’s management of violating Nigerian labour laws and ILO conventions, alleging that the dismissed staff were replaced with Indian nationals.
Dangote is indeed deeply anti-union in his operations and I hope he has learnt that trade unionism is a constitutional right that no industry should be allowed to violate. For its part, the union should not have attempted to sabotage an industry that is so important to Nigeria’s development prospects not just because it is not lawful, but even more because it would do great harm to the whole country.
After a long period of hostility, the Tinubu administration appears to be warming up to Dangote with the recent presidential directive to place a 15% tariff on imported fuel. I do hope that it is an attempt to provide some protection for this vital industry that is so important to our economy. Dear Dangote, I believe that you are right in your attitude that the struggle continues.
Ibrahim is a professor of Political Science and development consultant/expert, and Senior Fellow of the Centre for Democracy and Development. He is also the Chair of the Editorial Board of Abuja-based online newspaper, PREMIUM TIMES.
