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Government needs $20b to revive economy, says Dangote

By Femi Adekoya and Benjamin Alade   |   18 October 2016   |   4:49 am
Aliko Dangote

Aliko Dangote

Unveils plans to invest in dairy business

The Federal Government requires up to $20 billion in fresh funds to revive the economy from recession, the President, Dangote Group, Aliko Dangote, has said.

According to the businessman, efforts should be intensified at restoring investors’ confidence to attract the needed funds.Dangote is hopeful that the nation will come out of recession in the first quarter of 2017 if the government could get its priorities right and implement the right policies.

He stressed the need for government to address foreign exchange challenges if it wants private sector operators to increase their stakes in the diversification agenda. According to him, diversification from oil cannot be achieved if there is little or no foreign exchange available for private sector operators.

Besides, Dangote has unveiled plans to invest in dairy business to address dependence on import in the sector.According to him, 98 per cent of the country’s demand for dairy products is being imported, stressing that plans are on to turn around the nation’s milk industry over the next three years.

“We are already discussing ‎with the Central Bank of Nigeria (CBN) to kick-start this project. We believe we can do a lot to bridge the importation gap by developing local production of this product because we have the competitive and comparative advantages.”

He spoke during a courtesy visit by the Executive MBA students of the Lagos Business School (LBS) to his refinery in Lagos.Dangote who expressed optimism that the country would get out of the current precarious state, however, argued that this could only be achieved if the right support would be given to the Organised Private Sector (OPS) through adequate foreign exchange supply, infrastructural development as well as consistent and favourable economic policies.

“Nigeria has what it takes to be great again. I believe so much in the Nigerian economy and if the right things are done, we should get out of the economic recession by first quarter in 2017. The private sector is huge and I think we will get out of the recession ‎as soon as possible,” he said.

In his presentation tagged the “Role of business in driving sustainable development in Africa – The story of Dangote group,” he said the group had grown from a commodity trading company to a more diversified conglomerate over the last two decades.

The businessman added that the group’s operation was underpinned by five key pillars which are to provide basic needs, substitute imports and earn foreign exchange from exports, execute efficiently new plants and technologies, operate effectively by entering new markets with highest quality products, entering into strategic partnerships and investing in human capacity ‎development.

“We are top 10 in Africa and top 400 globally. We are globally competitive, growing local capacity, manufacturing quality products, rapidly transforming ‎from a Nigerian company to a dominant African brand and our revenues and profitability have continued to grow,” he said.

  • Basil Ogbanufe

    US$20B required to get out of recession. This fresh funding can be realized through sales of national assets like NNPC, NLNG etc to Nigerians through the NSE by way of IPO. Thus NNPC becomes NNPC Plc, NLNG becomes NLNG Plc and so on.

    • Taiwo Umolu

      Who bought and what happened to the ones we sold in the past. Where will the dollars Nigerians will need to buy them in NSE come from? Nigeria as a country is short of dollars and you are talking of citizens buying with dollars. It is easy to talk

      • Basil Ogbanufe

        1. NSE is Nigeria Stock Exchange, and it works with Naira not US dollars.

        2. First bank Plc was previously owned by the FG. IBB sold it to Nigerians by way of IPO and that is why it is a quoted company. NAHCO Plc was previously owned by the FG. OBJ sold it to Nigerians by way of IPO and that is why it is a quoted company.

        Therefore, if NNPC becomes NNPC Plc and NLNG becomes NLNG Plc they will do very well and all Nigerians will benefit.

        3. Government’s objective should be for the country to attain self sufficiency not acquisition of foreign currencies.

        4. US$20B is N10 trillion @ N500 to US$1. This will mean N1000/Nigerian for 10 million Nigerians.

        5. My dear brother let those national assets be sold to Nigerians through the NSE by way of IPO. This is in our collective and individual best interest. It will strengthen the economy. Lead us towards self sufficiency. Entrench transparency, accountability and productivity. Improve our foreign reserve and strengthen/stabilize the Naira.

        • ewucanbeer

          You beat me to it and gave examples. I tried to be concise.
          Damn you are good! Are you into finance?

          • Basil Ogbanufe

            No, not into finance. But we are just having an enlightening/educative discussion. And it is still on.

            I believe government should hands off the economy for Nigerians to manage through the NSE by way of IPO, while it focuses solely on regulation. Government managing and regulating the economy at the same time is corruption, and encouraging corruption.

        • Sammy82

          Only your Nahco example rings true, first bank was never at Amy point owned by the FG except they omitted that in their history statement. It was listed on the NSE in 1971. Only changed name to First Bank PLC in 1991 because of the Bank and Financial Institutions Decree. Just a lil fact check. Cheers.

      • ewucanbeer

        1. The ones sold were bought by local and foreign consortia.
        2. Nigerians do not need dollars to buy in a Nigerian (NSE) issue or sale of shares, they will buy with Naira which will mop up excess liquidity (Naira) from the economy. This will in turn make naira scarce which will firm it up to maybe $1 to 250 Naira.

        (Economics 201!)
        Hope I explained it well.
        Oh I’m an engineer, not an economist!

  • Anne Mumuney

    Based on what parameters do we need $20 billion to get out of this “recession”. How did our “Government pikin”arrive at that figure? Everyday huge figures are thrown around in the papers. Large loans are given by international organisation, and yet nothing is happening to our basic infrastructure. When a real economy, the United States, was in a real recession, the government did two major things. Created jobs through pumping money into infrastructure and cut government recurrent expenditure drastically. Even the President took a pay cut. Yes they gave bailouts, yes they were creative with taxation, but they have a sophisticated economy, and systems in place to prevent abuse to an acceptable percentage. For us, even our sole product, we don’t add value to. So what economy are we talking about. Majority of Nigerians are unskilled, uneducated labor, and we will never get out of this cycle, until roads, transport, education and health take us out of the dark ages. Until we are ready to get real, this constant manipulation of inane policies will continue, and the crumbs from the cycles of corruption will keep trickling down to keep us in survival mode, so we keep trudging on, hoping for a better day. Good luck, people.

    • Tosin

      to be honest $20billion is not a lot of money, but the leadership (government-wise) is incompetent. I wouldn’t give Nigeria even $1billion if I had it. Well, I would, but it would take so much organizational skill to give it in a way that makes a positive impact and not a negative impact.

  • Folake Vaughn

    “We are already discussing ‎with the Central Bank of Nigeria (CBN) to kick-start this project.” Typical. While the rest of investors, local and foreign, have to go through the long list of red-tape constraints typical of our country, he just summons the CBN governor, and obtains all kinds of concessions to the detriment of the competitors. Very patriotic indeed!

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