Friday, November 22

Fall in Oil Prices a Good opportunity to diversify the Nigerian Economy – Aliko Dangote

Africa’s renowned richest man, Alhaji Aliko Dangote has said that the fall in oil prices portends dangers to some businesses, but presents a good opportunity

to diversify the Nigerian economy.

Speaking in Lagos at The Economist Summit on Nigeria, held yesterday, Dangote Entitled: ‘Nigeria: The Dawn of a New Era?’ the summit was organized by The Economist Events, a subsidiary of The Economist International magazine.

He stated that despite the fall in oil price, a lot of sectors were doing well in Nigeria, adding that the problem was that people were underestimating the resilience of the Nigerian economy. He also discharged fears about the impact of the fall in crude oil prices on the Nigerian economy, saying the decline would not translate to doom for the economy.

While speaking at the Summit, he said Nigerian companies should learn to export; advising that they should leverage on the 320 million population of the West African sub region to grow their businesses through export. “If we don’t diversify the economy now, then we would never do it,” He said.

According to him, “I think people are underestimating the economy of Nigeria. They just go and look at foreign exchange, because price of oil has gone down, it means that everything has gone out of the window. That is not correct, in some areas, yes, depending on your business.”

“If you look at it, right from October to November, our sales of cement have actually been going down, even though at a cost because we took the price down by 35 per cent, but this has given us over 50 per cent market growth up to January, February.

“January, you know is a very slow month, but in February, we had 47 per cent growth in terms of volume. And our own estimate is that in the next three months we would have over 60 per cent growth. We could not go beyond this 50 per cent because we have been having serious issues in terms of gas.

“On our sugar too, we have seen growth of about 80 per cent. When you take a company like Coca-Cola, it has actually exhausted its capacity. They delisted about three years ago, and they doubled their capacity within these three years, and now their major problem is that they cannot meet up with their capacity, and now they have a plan to double their capacity in the next two and half years.

He said, “So it is not that there is dullness all over the economy, no. In some areas things are even moving up. But it does not mean that people should sit back and say there is crisis. Sometimes, crisis is also an opportunity, so you use it very well so that the crisis should not happen to you.

“You just had to have faith, and keep pushing to make sure you are where you are and that is what we are doing. That is why we are not stopping in all our projects, we know the market, and we know the dynamics of the markets.”

While shedding more light on Forex Subsidy, he noted that there is nothing like subsidy. It is about giving incentives to people to set up industries. And that is happening almost everywhere and Nigeria is not even the highest.

In his words, “If somebody has a business, he is more interested in running his business than in round tripping. Those people doing round tripping, no matter what you do, they would still do round tripping, they would not stop doing round tripping.

“Give them what you want to give them, their own business is how to make money from the differential in foreign exchange rate. But there are ways government can block them, by making sure that the goods to be imported are here. They would not be able to take dollars without you bringing in the goods”, he noted.

Dangote urged that it is high time we learn to diversify our economy as a country stating that the one quick policy, which is what we have been talking about is diversification of the economy. This is the right moment. I know in Nigeria, once the oil price goes up to $80, nobody will diversify, and we would go back to our misbehavior.

“Government should be very specific and come out with clear policy that we would support. And the implementation has to be monitored. If we don’t do it now, we would never do it. He also called on Nigerian Firms to learn and focus on exporting their home made products for the benefit of all.

The summit had in attendance economic experts and top government officials, including Managing Director/Chief Executive, Access Bank Plc, Mr. Herbert Wigwe; Managing Director/Chief Executive, Oando Plc, Mr. Adewale Tinubu; Managing Director/Chief Executive, Financial Derivatives Company, Mr. Bismarck Rewane; Managing Director/Chief Executive, Vero Capital Management Company, Danladi Verheijen and Minister of Industry, Trade and Investment, Mr. Okechukwu Enelamah.

 

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