‘How many investors can build refineries?’ Akinwumi Adesina asks, warns against conspiracy agaist Dangote
*Says it's bad signals to foreign investors about Nigeria
With more supports coming from local and international organisations and eminent personalities for Dangote Group against the Bola Tinubu-led Federal Government, President of the African Development Bank (AfDB), Dr. Akinwumi Adesina, has criticised the “monopoly” accusations against Alhaji Aliko Dangote, President of the company.
Adesina spoke in an X post shared by Femi Otedola on Tuesday.
On Saturday July 20, 2024, Alhaji Dangote said the Board of Directors agreed that the company should halt plans to invest in Nigeria’s steel industry “to prevent accusations of being branded a monopoly”.
By implications, the saying of whether Nigeria is a cursed country is becoming clearer as people who have capacity to develop and move the country forward will now stop their contributions.
Because, some elements currently enjoying the backing of State are being behind the monopoly accusations against the only Nigeria with the gut to grow the country economically, although the accusers have neither meaningful nor positive contribution they make The DEFENDER reports.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) had earlier claimed that refineries in the country — including mainly the Dangote Refinery are substandard and therefore produce inferior petroleum products.
The regulator also accused Dangote of monopoly — triggering a heated dispute between world’s rrichest black man and Nigeria’s oil sector regulators.
As the conflict heightened, Dangote offered to sell his 650,000 bpd capacity oil refinery to the Nigerian National Petroleum Company (NNPC) Limited on July 22, 2024.
This globalised online newspaper’s investigations revealed that Nigeria’s only successful handshake with oil management happened when Maj-Gen Muhammadu Buhari (Rtd) built four of such industry for the country as an extremely Federal Commissioner for Petroleum
Reacting to the development, Adesina defended the billionaire saying “Dangote refineries surely cannot be asked to compete with importers”.
“Monopoly often exists where there are high barriers to entry or high capital costs,” he said.
“How many individuals or companies can do railways? How many can do refineries of the scale of Dangote Refineries?
“In a nation that has been importing refined petroleum products for several decades, the abnormal simply became very normal.
“No smart investor would make a $19.5 billion investment and want it to be undermined by importers.
“To manufacture is extremely expensive and risky. This is even more so in Nigeria, given the very challenging business and economic environment, fraught with policy uncertainties and policy reversals, and where the self-defeating default mode of ‘simply import it’ is always so easily rationalized and chorused to solve any problem.
“Competition is good for everyone. But is Dangote refineries anti-competitive? What is the evidence?
“Has Dangote refineries prevented any other company from setting up refineries? Why have others not done so? How come they have not done so for several decades? Was it Dangote that held them back?
“But Dangote refineries surely cannot be asked to ‘compete’ with importers of petroleum products. That is not competition.”
‘Let importers build local refineries’
Adesina also said importers set up local refineries and compete by refining in Nigeria.
“That is fair and justified competition,” he added.
“We cannot and must not undermine, disparage or kill local industries, talk less of one that is of this scale — a jewel of industrialisation in Nigeria.
“It is more than simply delivering the cheapest product to the market. It is about domestic supply security, driving (and yes, protecting) globally competitive industries, maximizing forward and backward linkages in the local economy, job creation, reducing forex expenses and shoring up the Naira.
“We must not be myopic.
“This whole disparaging of Dangote is uncalled for. It is self-defeating. And it is very bad for Nigeria. Who will want to come and invest in a country that disparages and undermines its own largest investor?
“Investing is tough. Pettiness is easy.
“It sadly sends a signal that the price for sacrificing for Nigeria is to get sacrificed.”
On July 22, the house of representatives joint committee on petroleum resources (downstream and midstream) launched a probe into claims that local refineries produce inferior products.
