Ethiopian prov­ince in show­down with Nige­rian ce­ment op­er­a­tions

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DANGOTE Ce­ment, con­trolled by Africa’s rich­est man, Aliko Dangote, said it may shut its op­er­a­tions in Ethiopia if author­i­ties in the cen­tral state of Oro­mia don’t re­verse an or­der to ce­ment mak­ers to hand over con­trol of some parts of their busi­nesses to lo­cal young peo­ple.

Oro­mia state’s East Shewa Zone ad­min­is­tra­tion wants the Nige­rian com­pany to out­source its pumice, sand and clay mines to youth groups or be re­spon­si­ble for “any prob­lems” that may arise, ac­cord­ing to a let­ter from the author­ity to Dangote and ver­i­fied with a rep­re­sen­ta­tive of East Shewa’s ad­min­is­tra­tion. The re­gional gov­ern­ment sees the trans­fer of jobs in pumice pro­duc­tion as a way to ease youth unem­ploy­ment and quell un­rest, ac­cord­ing to the doc­u­ment.

Any mis­man­age­ment of min­ing in­fra­struc­ture in­clud­ing build­ings and ex­ca­va­tors could “lead to to­tal break­down of our busi­ness,” Dangote ex­ec­u­tive di­rec­tor Ed­win De­vaku­mar said in La­gos, Nige­ria’s com­mer­cial hub, last week.

Ask for in­ter­ven­tion

The ce­ment maker will write to the fed­eral gov­ern­ment this week to ask for in­ter­ven­tion in the mat­ter and will con­sider shut­ting the plant in Mugher, about 90km north of Ad­dis Ababa, as a “last op­tion” if this fails, he said.

There’s “no in­ten­tion to dis­place any in­vest­ment,” so long as Dangote is “work­ing by the laws and reg­u­la­tions in our re­gion and coun­try,” Tekele Uma, head of Oro­mia’s trans­port author­ity, said. “If any­one’s com­plain­ing about Oro­mia re­gional state, we’re ready to talk with them. Any in­vest­ment can come. Any in­vest­ment can go.”

Mo­tuma Mekassa, Ethiopia’s min­is­ter of min­ing, pe­tro­leum and nat­u­ral gas, said that he wasn’t aware of an at­tempt by Dangote to reach his of­fice. An of­fi­cial at the fed­eral min­istry said Dangote should make an ap­proach through “ap­pro­pri­ate chan­nels.”The Ethiopian gov­ern­ment is search­ing for ways to re­duce youth unem­ploy­ment af­ter vi­o­lent protests by Oromo com­mu­ni­ties over al­leged land dis­pos­ses­sion, po­lit­i­cal marginal­i­sa­tion and re­pres­sion led the gov­ern­ment to de­clare a state of emer­gency last year.

Dangote Ce­ment was among sev­eral busi­nesses at­tacked dur­ing the un­rest. The protests trig­gered a 20 per­cent slump in for­eign in­vest­ment to $1.2 bil­lion (R15.68bn) in the six months to De­cem­ber. The or­der to out­source min­ing is “a vi­o­la­tion of our rights be­cause the gov­ern­ment has given us a min­ing li­cence,’’ said De­vaku­mar. “If I don’t have lime­stone and ad­di­tives my ce­ment plant is use­less.”

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