Corporate icon of the year: Aliko Dangote: Simplifying the difficult

Aliko Dangote is one name that rings a bell not just in Nigeria but across the continent of Africa. Born 65 years ago in Kano, Nigeria’s second-largest city, Dangote started off as a young man with incisive business acumen. He sought opportunities in the most unlikely of situations. History, however, shows that industriousness runs right in his family. His great-grandfather was one of the richest men in West Africa, making his fortune from trading kola and ground nuts. Dangote’s father died when he was eight, leaving him to be raised by his maternal grandfather, who was a building materials trader.

After completing his secondary education, Dangote travelled to Egypt, where he earned a business degree from Al-Azhar University. He returned to Nigeria and launched his own cement trading company using money borrowed from his uncle. Dangote moved from Kano to Lagos and ramped up imports. He established the business that would eventually become the Dangote Group in 1981.

Dangote expanded his business throughout the 1980s and 1990s to include trading in sugar, flour, fish, rice, milk and iron. He, however, changed the company’s focus from trading to manufacturing in 1996 after visiting Brazil to study manufacturing. He thought there was an opportunity to establish a local business that would profit from satisfying the fundamental consumer needs of Nigeria’s expanding population. And this has given birth to one of the biggest conglomerates in the world today. In fact, there is hardly a home in Nigeria where a Dangote product is not used.

Dangote Cement

A division of Dangote Industries, which Dangote established in 1981 as a trading company with an initial focus on importing bagged cement as well as other goods like rice, sugar, flour, and salt, is Dangote Cement.

Over time, the group began to import bulk cement into the Apapa and Port Harcourt terminals, which it then bagged for distribution. It decided strategically to transform from a trading-based business into a fully-fledged integrated manufacturing operation throughout the 1990s. This was the starting point of the ambitious plan to dominate the cement industry in Africa.

Now, Dangote Cement is the largest cement manufacturer in Africa. The giant has a production capacity of 51.6 millions tonnes per year across 10 countries in Sub-Saharan Africa: integrated factories in 7 countries, a clinker grinding plant in Cameroon, and import and distribution facilities for bulk cement in Ghana and Sierra Leone. Together, these operations make it the largest and leading cement producer in sub-Saharan Africa.

Even as the influence of the man is felt across Africa, his contribution to Nigeria’s economy is mind-blowing. Dangote Cement, for instance, has three plants in the country: Obajana in Kogi State; Ibese in Ogun State; and Gboko in Benue State. With a capacity of 16.25Mta across five lines, the Obajana plant is the flagship facility and the biggest of the three factories in Nigeria, followed by the 12.0Mta plant at Ibese and the 4.0Mta plant at Gboko. These plants employ thousands of Nigerians and non-Nigerians across the country. According to a statement in October by Anthony Chiejina, Group Head Branding and Communications, Dangote Industries Ltd, Dangote Cement employs over 22,000 people directly, while a lot more are employed indirectly.

Beyond the employment of thousands of Nigerians and the consequent reduction of poverty, Dangote Cement also contributes hugely to the government through the prompt and adequate payment of taxes. Also, with the export terminals at Apapa and Port Harcourt, the behemoth exports to other African countries and attracts FX to Nigeria.

Dangote Fertiliser

In March of this year, President Muhammadu Buhari launched the Dangote Fertilizer Plant – another of Aliko Dangote’s huge investments in Nigeria. The plant occupies 500 hectares (1,235 acres) of land on the outskirts of Lagos and has the capacity to produce three million metric tons of urea annually.

With this huge capacity, the local demand of 1.5 million tonnes/year will be met, and the large surplus will be for export. Producing both urea and ammonia fertilizers, the plant, which cost Africa’s richest man $2.5 billion, is reckoned to be the world’s third-biggest fertilizer plant and second-biggest producer of urea-based fertilizer.

The coming commencement of operations of the fertilizer plant came at no better time. A huge population of the world is being threatened by hunger and food shortages, due partly to the escalation of the war between Ukraine and Russia. Russia and Ukraine are major suppliers of urea, potash and phosphate: key components of fertilizers.

The number of people on the edge of famine has jumped to 44 million from 27 million in 2019, the UN’s World Food Programme said in March, and parts of Africa could be plunged into hunger sooner than envisaged if food production is not ramped up, experts say. This is even as global fertilizer prices have been on the rise since 2020, surging as much as 70% in the past year.

So, the launch of the plant came at no better time. As President Buhari rightly pointed out during the launch, “The plant will greatly create wealth, drastically reduce poverty, and secure the future of our nation.”

He further explained that “the agricultural sector, another focal point of our economic policy, we expect a boom as fertiliser is now readily available. Many Nigerians who hitherto practised subsistence farming because of the non-availability of necessary inputs can now take up agriculture as a business. We expect a rise of a new breed of agropreneurs who will add value to farming and make the nation self-sufficient in food production.”