Dangote seals $750m cement production pacts with Congo, Ethiopia
Category: Investors NewsBeat
October 7, 2011
DANGOTE Group of Companies may have sustained its rising profile as a pan-African organisation through fresh $750 million pacts with two countries in the region for cement production. Specifically during the week, the Dangote Group signed a $350 million investment agreement with the Central African Republic of Congo and another $400 million with Ethiopian government.
The deals were consummated at separate occasions in the respective capital cities of both countries, where President and Chief Executive Officer of the Dangote Group, Alhaji Aliko Dangote, signed on behalf of his company, while three Congolese Ministers, Pierre Moussa in charge of Ministries of Planning, Economy, Integration and Coordinator of the Economic Pole; Mr. Rodolphe Adada, Minister for Industrial Development and Private Sector Promotions and Mr. Pierre Oba of the Ministry of Mines and Geology endorsed the agreement on behalf of their government.
Only last week, a similar agreement was signed with the Camerounian government after which a ground breaking ceremony for the laying of the foundation for a $115 million cement factory was held.
Adada, who spoke on behalf of his government hailed Dangote’s deft moves to invest in the country and pledged full support of the government for the project.
According to him, Dangote has become a symbol of the emancipation of the African continent with the significant investment in Congo and other African countries.
He said: “The Dangote project is important to our people and our economy as it enables us achieve President Denis Sassou Nguesso’s vision for a robust and diversified economy. The project will help the country significantly reduce the imports of cement and even enable us become a net exporter of cement while boosting economic growth, development, job creation and income generation.
“We are proud to have Dangote in Congo and it is a demonstration of an excellent relationship between the governments of the Federal Republic of Nigeria and the Republic of Congo,” he added.
Speaking at the event, Alhaji Dangote said the intention of the Group in its foray into Congo was not just to make profit but also to further empower the people of Congo, create new jobs and wealth.
“We are committed to our business all over the world and Congo will be no exception. We are going to invest $350 million in the construction of a fully integrated cement factory with an installed capacity of 1.5 million tonnes per year within the next three years and transform Congo into a net exporter of cement,” Dangote said.
According to him, this investment will serve as a launch pad into other sectors of the Congolese economy.
The factory is to be located in the territory of the Administrative District of Bouenza in the Southern part of the country. As a fully integrated plant the facility will process local limestone and other raw materials.
Dangote assured of a successful delivery of the project, which is one of many other successful projects in 14 other African countries, where the company has invested noting that the investment would further strengthen the bilateral ties between the two countries.
“This indeed, shows that Africa is gradually taking its destiny in its own hands rather than wait for investors from outside Africa.”Investment in the real sector of the economy is the only way that our continent can achieve the much desired accelerated growth and development that we have yearned for.
“The developmental challenges of Africa are quite tremendous. According to a report by the McKinsey Global Institute issued in June 2010, Africa requires at least $46 billion in spending annually to meet infrastructural needs. It is obvious that African governments alone cannot hope to meet this demand due to the various competing needs in other aspects of the economy.
“This is why private companies are needed to complement the government’s efforts. It is in this light that we have decided to invest in Cameroon,” Dangote explained.
He added: “We are motivated to create an African success story because we believe that entrepreneurship, especially our own home-grown African entrepreneurship, holds the key to the future economic growth of the continent. The fact that Africa offers one of the highest returns on investment in the world is an additional incentive for any discerning investor, who can take calculated risks,” he added.
Underscoring the Dangote Group’s commitment to Corporate Social Responsibility, he stated that while Dangote Group was in the business of creating wealth primarily, it was also mindful of the need to touch the lives of people especially in the immediate areas of its operations.
He stressed that “as a company, we have always been conscious of the need to give a little of our profits back to the society as a guarantee for sustainable business success. This has been our guiding business philosophy. In all our host communities where we operate, we have a robust corporate social responsibility strategy in place, for translating this philosophy into projects and actions that touch positively on the citizens,”
“With the cooperation of our host communities, we will create employment opportunities and help small businesses to grow in Congo”, he assured.
The business mogul hinted that the long term ambition of the Group was to develop 50 million tonnes of cement production and terminal capacity in Africa by 2015, stressing that Dangote Group nursed the ambition to become a truly pan-African champion in the manufacturing sector, capable of competing globally with the largest cement companies in the world.
“We quite understand the dynamics of doing business in Africa because we are Africans. We respect the people and their cultures anywhere we operate in Africa and for us this is an undeniable edge,” he added.
Meanwhile, the deal to build a cement plant in Ethiopia was also signed between Alhaij Dangote and officials from the Ethiopia’s Oromiya region, where the plant will be constructed with an initial plan of two million ton production per annum. The project is scheduled to be concluded in 2013.