REFINING AMBITIONS
Istarted hustling in primary school,” says Africa’s richest man, a softspoken Nigerian billionaire whose iconic status reaches far beyond his home nation. Aliko Dangote, whose riches were built on commodities trading, arrived at a closeddoor event hosted by Barack Obama in Johannesburg last week to a reception that rivalled the former US president’s own rapturous welcome.
Then, in a panel discussion with Trevor Manuel and John Collison, Dangote had to field almost all the questions from the crowd of 200 young “Obama Foundation leaders”. SA’S former finance minister and the Irish co-founder of Stripe, who in 2016 became the world’s youngest self-made dollar billionaire, were reduced to sideshows.
Dangote, whose net worth of $12.4bn makes him the
100th richest person in the world according to
Forbes, says he’s been “testing money for a very long time”.
In his early school days, he sold sweets that he bought with his pocket money.
Those trading skills put him in good stead for a formal career that kicked off in 1978 when he started his own commodities trading business.
“Most Nigerians” were in the trading game at that time because “industrialisation wasn’t really what people were thinking about”, he recalls.
There are parallels with SA: Dangote says inconsistent government policies and an insufficient or unreliable electricity supply scuppered any efforts to kickstart Nigerian industries.
Not much changed for nearly two decades, so Dangote’s trading firm focused on building its empire through to 1996. “We made a substantial amount of money,” he says, adding that he’d never had to borrow a cent until that point. Aliko Dangote’s empire was built on imports, but he now favours protectionist policies to stimulate local manufacturing. The Nigerian cement king’s latest project is to build the world’s largest oil refinery
But as the turn of the millennium approached, Dangote says he hired a consulting firm to assess how the West African nation could shift from its heavy reliance on imports to become a manufacturing powerhouse.
What was required, the consultants concluded, was a cosier relationship with the government so Dangote could push it to start by tackling the energy problem.
With a fair dose of persistence and tact, he says he found a receptive audience and the ball started rolling.
“So we started various industries,” including a sugar refinery and a flour mill. (Jselisted Tiger Brands, much to its regret, bought Dangote Flour Mills for R1.5bn in
2012, but sold it back for $1 after four consecutive years of losses and much criticism that it had failed to conduct a proper due diligence process.)
Soon after those ventures, Dangote trained his sights on something bigger: cement. Nigeria was importing loads of it and there was a chance to change that.
“The president said ‘OK fine, Aliko, what can we do?’ I said: ‘Mr President if we are going to continue to import, we will be importing poverty and exporting jobs, so if we want to produce locally you have to give some sort of incentives where you can only import if you are doing backward integration — and that’s the policy that Nigeria adopted for us to have self-sufficiency in cement.”
And it’s worked. Dangote Cement — which, according to the company’s founder, provides quality products at attractive prices despite the fears of some that state protection would militate against this — is now