President Goodluck Jonathan and Vice President Namadi Sambo(in the background)

President Goodluck Jonathan and Vice President Namadi Sambo(in the background)

May 28, 2013

Nigeria and South Africa accounted for 95 per cent of total portfolio investment of $20.15 billion (N3.204 trillion) recorded in the African continent in 2012, according to the African Development Bank, AfDB.

The AfDB in its annual African Economic Outlook said total portfolio investment in Africa in 2012 stood at around $20.15 billion and was expected to increase by 30 per cent to $26.2 billion (N4.166 trillion) in 2013, eclipsing the pre-crisis peak of $22.5 billion in 2006.

The AfDB also gave a forecast of the
growth in Africa’s economy at 4.8 per
cent and 5.3 per cent in 2013 and 2014
respectively, driven by commodity
exporters in West Africa such as Nigeria, Ghana and Ivory Coast.

According to the AfDB Foreign Direct
Investment, FDI, to Africa, was set to rise by more than 10 per cent in 2013,
approaching its 2008 record high,with the fast-growing sub-Saharan region likely to receive the majority of inflows. It however, noted that a weaker global economy and a prolonged crisis in the euro zone could reduce commodity export earnings, overseas aid, migrant remittances and FDI inflows.

The AfDB added that African countries
will be heavily dependent on aid with
the exception of Nigeria, South Africa,
Democratic Republic of Congo, Egypt
and Morocco, who will be the major focus on investment inflows into the continent.

The AfDB report noted that FDI is
forecast to reach $56.6 billion this
year from $49.7 billion last year, short
of $57.8 billion recorded in 2008. The AfDB said, “almost the entire projected increase in FDI to Africa is expected to be in sub-Saharan Africa, while in 2012 northern Africa absorbed half the increase in FDI.

“This confirms sub-Saharan Africa’s
economic dynamism as well as the
hesitance of investors over political
developments in North Africa,particularly in Egypt. “Africa’s economic prospects depend on global and domestic factors, which are highly uncertain.

According to estimates, a one percentage point decline of GDP in OECD member countries causes African GDP to decline by about 0.5 per cent and
Africa’s export earnings by about 10
per cent.” The report said total external financial flows to Africa, including FDI,
portfolio investment, official development assistance (ODA) and
remittances are projected to reach
$203.9 billion in 2013, above a record high of $186.3 billion in 2012.

It added that remittances, which last year overtook FDI and ODA as the largest external source of finance to Africa for the first time, are expected to increase to $64 billion in 2013 from $60.4 billion in 2012.

“But as the euro zone crisis hurts the employment prospects of the African diaspora in Europe, remittances to the continent could grow at a slower pace. “Africa’s ability to attract higher financial flows after the 2008 crisis reflects improved macroeconomic policies but hides disparities between countries.

“Five countries account for more than
50 percent of total external flows:Nigeria, South Africa, Egypt, Morocco
and DRC,” it said. “In contrast, half of
African countries rely on aid as the largest external source of finance for development needs,” the AfDB said.


About beegeagle

BEEG EAGLE -perspectives of an opinionated Nigerian male with a keen interest in Geopolitics, Defence and Strategic Studies
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  1. beegeagle says:


    Paul Obi in London
    1 February, 2013

    Nigerians living abroad, who remitted $21 billion home last year, rank among citizens of the top five countries that remitted about $530 billion to their countries in 2012, showing a tremendous increase from the previous year.

    In the latest ranking by the World Bank, India led the pack, followed by China, Philippines, Mexico and Nigeria in the fifth position. Figures show that India and China received $60 billion from their citizens abroad,Philippines ($24 billion), Mexico ($24 billion), and Nigeria ($21 billion). Others who also joined the top 10 include Egypt, the sixth largest, with about $18 billion remittance last year, indicating an astronomical surge from $9 billion in 2008. It is believed that the surge is perhaps driven by increased support by migrants to their families in the face of political uncertainty or savings brought by returning migrants.

    The remittances of $530 billion last year by the migrants outstripped the World Bank’s projection for the period, which were expected to reach $406 billion in 2012, a growth of 6.5 per cent over the previous year. These flows are expected to rise to 8 per cent in 2013 and 10 per cent in 2014 to reach $534 billion in 2015.

    Analysts believed the rise in remittances from Nigerians in the Diaspora is being done to enable them subscribe to a Diaspora bond being planned by the Ministry of Finance. Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, in September 2011, had announced in Washington the plans by the Federal Government to issue the Diaspora bond in a bid to secure alternative means of funding critical infrastructural projects in Nigeria.

    A Diaspora bond is a debt instrument issued by a country or a private corporation to raise financing from its citizens in foreign countries. However, the remittances come at a high cost to migrants from sub-Saharan Africa, which the World Bank identified as the most expensive region to send remittance to, with a transfer costing in the third quarter of 2012 about 12.4 per cent of the amount transferred. This is almost twice the corresponding figure of 6.5 per cent for South Asia.

    According to the World Bank, the new figures for 2012 now surpassed the international community global aid for development, poverty reduction, healthcare and other strategic sectors. Head of the World Bank Migration and Remittance Unit, Dilip Ratha, was quoted to have said that there is a likelihood of billions of some of the remittances not being documented as migrants might have channelled or transferred their funds through non-official means, to avoid documentation.

    According to the World Bank, over 215 million people, about 3 per cent of the world’s population, live outside their countries of birth. Remittances by them are considered three times the size of official development assistance and provide an important lifeline for millions of poor households in their countries. The bank estimated that the migrants, if they were all to reside in a country, will be far bigger than most countries, even with the possibility of becoming the fifth most populous nation, following only China, India, America and Indonesia.

    The United Kingdom, the United States of America, European countries and Asia nations are the top regions where most of the funds were remitted back home by migrants workers.

  2. Henry says:

    Great news. Our next target should be to match the polish economy at just over 600 billion usd in GDP. Our economy at just over 400 billion dollars, can do it as long as the government at all levels continue to invest in the growth of critical infastructures( electricity, roads,rail and sea-ports) as is currently been done.

    • Sideways&smilling says:

      Exactly, “electricity, roads,rail and sea-ports” (& security) are part of what put china where it is today… So effortless doing business there.

  3. Yagazie says:

    Henry, good analysis. We should be looking at matching the economies/GDPs of countries like Malaysia, Indonesia, South Korea and Austrialia instead of looking at overtaking that of South Africa.

    It can and must be done. – Australia with a population of about 26million has a GDP of about 900billion dollars.

    The white minority regime in South African with a population of 4.5million built up the GDP /current infrastructure (roads, rail, power, telecoms, airports and seaports) that is being enjoyed by post-aparthied South Africa of today.

    Once the Infrastructure (Road, Rail, Sea-ports, Electricity and telecoms) and right government policies are in place and faithfully implemented, with political will to tackle CORRUPTION, the sky/space will be the limit – as our natural enterpreneural spirit/drive will do the rest.

  4. jimmy says:

    This is where i like to comment
    Money: There five countries out of 53 that were not not aid dependent oga beegeagle please no i am not going down that road of point of correction but Egypt needs to be scrapped from that list. Since it receives$1b in military aid from the u.s.
    The thing about MONEY is that they are cold hard FACTS. When Nigeria gets her act together they will be no.1 people do not invests in your country because they love you no it is because they want a return on their investment.
    Per proportion of population India is 1b and china is 1.7b Nigerians @ 160M remit the most this is also good and bad. The good is that Nigerians abroad REMIT to invest and take of other responsibilities. The bad is that some of those responsibilities happen to do with PARENTAL/ SOCIETY which should not be the case because it enables the f.g. not to take care of its social obligations.Also the good a lot of Nigerians remit money FOR REAL ESTATE INVESTMENTS and also to send CARS / MACHINERY HOME These on the other hand are long term investments that will be beneficial to Nigeria.

  5. Henry says:

    indonesia at 1 trillion dollars GDP, australia at 900 billion dollars and south korea at over 1 trillion dollars at the moment are on another plain and way above our level. So, I’d prefer if we lower our expectations and are “SMART”
    S= specific
    M= measurable
    A = achievable
    R = realistic
    T = time bound

    At the stage were we are, our goal should be to catch up with poland and malaysia (600 billion usd). 600 billion dollars in 8years, from were we are at the moment at 375-400 billion dollars is achievable.

    NBS statistics for 2012

    Imports fell by 43%
    Exports grew by 15% (helped by non-oil sector)
    Oil exports fell by 31% to hold at 69%
    Manufacturing grew by 15%
    103 million active phone lines
    GDP growth 6.5- 7.2%
    47% of all FDI into africa in 2012.

    Looking at these stats, by any standards these numbers are impressive. What we must do is increase investments in critical infrastructure like have been earlier mentioned, grow capital from non-oil earnings, but still making sure that our oil earnings remain high. So for example, oil out-put holds steady at 2.7millin bpds/ day or increases to 3 million bpds/ day but only accounts for 50% of all government earnings, while other sectors account for 50%.

    *seeing that oil exports accounted for 69% of government earnings in 2012, a further reduction to 50% should be possible in 5years time.

    *So back to our 600 billion dollars target in 2012. FG should pay keen attention to the AGRIC SECTOR, FINANCIAL SERVICES SECTOR, OIL & GAS SECTOR and TELECOMS SECTOR, seeing that these sectors have been responsible for the growth we have been seeing in the past 5-6 years. However not interfering in them, an honest free market approach( even communist china, operates a free market economy), but building and strengthening critical regulatory infrastructure to see that these 4 sectors thrive. It’s all about getting our best foot forward.

    Improve Electricity,rails,roads, sea-ports, tax breaks and incentives, and see how only these handful of states(anambra , lagos,abia,ogun, rivers, akwa ibom and kano) take us to 600 billion dollars.

    CORRUPTION, let’s not kid ourselves this is the bane of our society. However Bernie maddof(70billion dollars in con), was not a nigerian, and probably doesn’t even know where nigeria is on a map.

    Anybody who says that a country/nigeria cannot grow because of corruption deserves to be shot or locked up to rot in jail. Brazil has the world’s 6th largest economy(ahead of the UK and france), despite prevailing levels of corruption. Same thing goes for india, 10th largest economy, china 2nd largest economy, south korea, italy , russia etc etc

    Despite high levels of corruption, they are amongst the world’s largest economies. I think the reason where these guys have succeeded and nigeria has failed is the judiciary. They all have an independent and strong judiciary, and this is where nigeria must work hard in other to fulfil our enormous potential.

    All in all, there is hope as long as we continue to show green numbers and are “SMART”.

  6. beegeagle says:

    Roger that, Oga Henry. All together.

    Anyway, we must bear in mind that the calculation of the GDP is slated for 2014 and that means rebasing the reckoning on contemporary indices rather than the outmoded 1990 INDICES around which current figures which suffice, have been calculated.

    According to the story, when that is done, Nigeria’s GDP would increase by as much as 65% !!

    • Saints says:

      Oga beeg.. I cant wait till 2014. That rebase means so much to the average nigerian diplomat and investors. I see nigeria changing(and its not me hallucinating) OBJ in his lecture at the Jigawa state investment summit. Considered the idea of BRICS as an ill concept.making straight reference to emerging markets like turkey,indonesia and Australia. We are all fully aware of the GDP figures of this Emerging economies compared to that of a certain member(name witheld) of the BRICS. And i am hoping the 2014 rebase takes us around the 400 bil. Line, i believe it would. knowing that compared to when we last rebased in 1990. Nigeria have more multi nationals and foreign investments.. I believe in naija joor.. As the yoruba saying goes “kokoro to’n je efo inu efo lo’n wa.” the insect disturbing the efo is inside the efo. Corruption would always remain with us as a souvenoir of our independence., we can only try to contain it.(i believe EFCC,ICPC) are created to that effect. To conclude with everything. i would like to encourage a massive investment in mechanised agriculture in nigeria and the mordernisation of herbal medications and treatments, A country should at least have an economic activity unique to it.

  7. beegeagle says:


    By Tim Cocks

    Nigeria’s plan to rebase its GDP will enable it to project its power on the world stage and may pose a serious challenge to South Africa’s position as the dominant force on the continent. The revaluing will advance Nigeria’s aim to be an African investment hub rivalling South Africa and make it more attractive for prized foreign investment, if its economy turns out to be nearly as big as its rival’s, analysts say.

    That could also advance its claim to a permanent seat on the United Nations’ Security Council, if a proposal to expand the Council goes ahead, but Nigeria must tackle endemic corruption and unreliable power supplies if it is to make progress.

    The country will in January change the base year for its gross domestic product (GDP) to 2008 from 1990, a move that could lead to a “huge jump” in the estimated size of Africa’s second biggest economy, the national statistics chief Yemi Kale told Reuters.

    Most governments overhaul GDP calculations every few years to reflect changes in output and consumption, such as mobile phones and Internet usage, but Nigeria has not done so since 1990. When Ghana rebased its vital statistics in November 2010, output shot up by 60 percent. A similar increase for Nigeria’s $247 billion economy would bring it to $395 billion, much closer to the continent’s top economy, South Africa — currently at $422 billion.

    And with growth expected at 7-8 percent this year, compared with 3 percent in South Africa, the picture of an emerging giant set to take first place in Africa is an easy sell. “Nigeria is like a green field in terms of investment … a global investment destination,” President Goodluck Jonathan told an economic forum in the capital Abuja last month. A recalculation showing a much bigger economy will strengthen that investment case, and Nigeria’s political clout. “It will help focus policy-makers on Nigeria as an emerging economy that needs to be taken seriously,” said Chatham House’s Alex Vines.

    “Forecasters are talking about Nigeria by 2050 being a G20 economy. The commercial sector already understands that Nigeria could eclipse South Africa fairly quickly.”


    Couple that with Nigeria’s frontier status – 150 million people in a fast growing country suffering from chronic underinvestment in infrastructure – and it looks attractive. By contrast, said Vines, “commercial people are talking about South Africa as a mature market that is declining,” partly due to labour and other policies that hurt its competitiveness.

    South Africa is still regarded from outside as the main route for investment into sub-Saharan Africa. That could change if Nigeria’s efforts to clean up its capital markets work – and if it can break longstanding infrastructure bottlenecks. “They’ve always had immense ambition to be a world leader and leader of Africa,” said Richard Dowden of the Royal African Society. “If their economy turns out to be much bigger than anyone thought, then that gives that a great boost.”

    But the government of South African President Jacob Zuma still has clear advantages. Its institutions function properly, and it is seen as having the one of the best legal systems in Africa. Nigeria, on the other hand, has tended to be a byword for corruption, fraud and mismanagement – seen in its persistent failure to sort out its roads or power problems.

    “Let’s not forget that Nigeria remains significantly underdeveloped in terms of basic infrastructure and faces very high income inequality,” said Standard Bank’s Samir Gadio. “This negative perception will not dissipate just because of the revision in aggregate GDP.”

  8. beegeagle says:

    Very quietly, we leapfrogged Egypt to become the second largest economy in Africa in 2011.

    Post-rebasing in 2014 and with Nigeria’s GDP based on the prevailing 7% growth rate, we might have a figure of $420 billion while South Africa, growing at 3% as is, might have a $440 billion figure.

    If current growth trends suffice through 2014 and 2015, Nigeria could emerge as Africa’s biggest economy as early as Xmas 2015.

    All said, long live healthy and rancour-free relations between the two African big hitters. Africa shall be the better for it. What do I mean?

    Look out for my next post.

  9. beegeagle says:
    Alhaji Aliko Dangote, Africa's richest man

    Alhaji Aliko Dangote, Africa’s richest man

    By Alexis Okeowo
    March 07, 2013

    Six years ago, Aliko Dangote paid a visit to
    Tanzania, on Africa’s eastern coast, and
    shared his dream of having an African-run
    business empire that would manufacture
    products all over the continent. To assorted
    government and business leaders, he announced that he was prepared to make an investment of $600 million to build a cement factory in southern Tanzania,
    alleviating the shortage in that country’s domestic cement supply. The Tanzanians were skeptical. “They didn’t believe us at all. They thought I was one of these ‘Nigerian 4-1-9’ scammers who try to go and scheme people out of their money,”
    Dangote says. “Or just one of these clever Nigerians who would come and be lying to

    The Tanzania story is clearly one Dangote
    relishes telling—not least because of how
    it’s turning out. Not long after his visit, his
    name appeared on a list of the world’s
    wealthiest people, and the Tanzanians realized they had been negotiating with Africa’s richest man.

    As founder and chairman of Dangote Group, he’s worth an estimated $16.3 billion, according to the Bloomberg Billionaires Index.“They pieced the two together,” Dangote says, sitting in his expansive Lagos office in late January.
    The room is so gigantic it appears nearly
    empty, even with tall plants, a conference
    table, and a large-screen television.

    Three months ago, Dangote Cement signed a final agreement there, with plans to produce 3 million tons of cement a year.Dangote Cement is Africa’s largest cement manufacturer; the Dangote Group employs 26,000 people in Nigeria alone.

    The company is constructing cement plants in Ethiopia, Zambia, South Africa, Senegal,Cameroon, the Republic of Congo, and several other African countries. “We want to be predominately in sub-Saharan Africa,
    and then we will move out of Africa,” he says. He announced plans last fall to construct plants in Iraq and Burma.

    Dangote Group also mills flour, processes
    salt, produces fertilizer and pasta, and has
    big plans for sugar.The Nigerian sugar refinery, located at the port of Lagos, is the second-largest in the world. “The same. revolution that we’ve had in cement, we want to replicate in sugar,” says Dangote,
    referring to his push to increase domestic
    production of a legacy import.

    Despite being one of the world’s top
    producers, Nigeria has yet to refine its own oil. Dangote wants to build a $7 billion facility that would daily process 400,000 barrels of petroleum.
    “When you look at most of what we’re consuming today,these are things that are being imported,” Dangote says. “We want to make sure that our people are self-
    sufficient in terms of producing more. The
    market is there for us to take, but the
    production is not there.”

    Because of his success and vision, his partners, friends, and admirers hold Dangote up as the face of the new Nigeria. With corruption on the wane and the economy liberalizing, Nigeria, they say, is safer than ever for foreign investment. And Dangote’s profile does appear to be contributing to greater confidence in the

    Goldman Sachs included Nigeria in its Next 11 list of the most promising 21st
    century economies,and Citigroup called it a “3G,” one of its “global growth generators,” countries with growth
    potential and investment opportunities. Dangote’s critics—who are not hard to find, if reluctant to speak publicly—say he hasn’t created a model for the future but simply found a way to play a still-rigged game better than others.

    Dangote, 55, is a household name in
    Nigeria and is seen as both a son of privilege who benefited from family connections and a striver who has earned his unprecedented wealth. A workaholic— other businessmen gossip that he rarely sleeps and never vacations—he spends about half his time in Nigeria and the rest. traveling around the world. He’s married with three adult children. “He’s charming and humble, but he’s hard to pin down,” says Theresa Okeke, the American director of Lagos’s Civic Centre, a recreational center for the well-to-do. He’s also a favorite among the moneyed set that circulates through the polo and boat clubs and extravagant mansions of Ikoyi and neighboring Victoria Island,enclaves separated by a bridge from the rest of Lagos. (Recently, the French liquor brand Veuve Clicquot said it plans to open an office in Lagos; some upper-class Nigerian families like to hand guests their very own yellow-labeled Champagne
    bottle at parties.)

    Dangote was born in Kano, the largest city
    in Nigeria’s mostly Muslim north, to a
    family of prosperous merchants. “I’m from
    a family that has been in business for a very long time; it’s in our blood,” he says. “But I did not ride on the back of my family to make money. I started
    everything by myself through hard work and didn’t inherit a dime. The only asset I inherited from my late father [an undisclosed sum of money], I donated to charity.”

    After graduating from Egypt’s Al-Azhar
    University with a business degree in 1977,he did, however, receive a loan of a little more than $3,000 from his uncle to start a trading enterprise in food staples,including rice and vegetable oil. He made the most of it, and four years later moved into transport, buying trucks and
    importing goods such as cement.

    During the first two decades of his career, in the 1980s and ’90s, Nigeria went through a
    series of military coups and dictators who held a firm grip on the economy. Dangote
    says that made doing business difficult,but with the election of Olusegun Obasanjo as president in 1999, he saw his chance to become an industrialist. He spent the first half of the 2000s restoring a cement plant in Obajana, north of Lagos,that would become his flagship factory. When he started cement trading in 1978,Dangote was concerned he would not be able to compete with Lafarge, the French multinational that had been the dominant cement supplier for decades. But he didn’t doubt the market’s potential.

    Before Dangote Cement, Nigeria was consuming 10 million to 15 million tons of cement every year, while Lefarge was
    manufacturing less than 1 million tons
    domestically. The rest was imported. Dangote now has plants across the country producing 20 million tons of cement, and he exports to Ghana. He plans to produce 15 million more in Nigeria by the end of 2014.

    Uzoma Nwankwo, managing director and
    chief executive officer of a private equity fund and Dangote Group’s former director of corporate finance, recalls Dangote coming to see him when Nwankwo was still head of risk at First Bank Nigeria. Dangote was transforming his trading company into a manufacturer and had
    solicited a loan from the bank, among others. “Because he was going into
    manufacturing, we could see the potential and had a lot more confidence, but [we] worried if he would have enough money
    to pursue this dream,” Nwankwo says.

    When Nwankwo joined Dangote Group in
    2005,the conglomerate was heavily in debt and, at one point, owed more than 50 billion Nigerian naira ($316 million in today’s dollars). “Fifty billion naira in 2005 was a lot of money to owe,” Nwankwo says. “We used to joke that when you see the banks are calling, you just drop the phone. Because they were just going to ask, ‘When are you going to pay us?’ ”
    Nwankwo says. “But he’s smarter than a lot of people give him credit for.”

    According to Nwankwo, Dangote took calculated risks and, unlike other Nigerian
    entrepreneurs, drove modest cars and sold
    his own properties in London and the U.S.
    to underwrite his businesses. Instead of
    asking for direct loans, he’d take on debt to buy and sell sugar and flour, and then funnel the profits into the Obajana factory.

    When the banks realized how he was
    financing his operations, they had already gotten to know him, and Dangote told
    them they could either help him finish the factory or push him into bankruptcy. They
    chose the former.

    Dangote’s rise has been bolstered by
    broader improvements in Nigeria’s business environment. Four years ago, in the wake of the global financial crisis, the Nigerian Stock Exchange lost 70 percent of its value, and 10 lending banks failed. Now, insists Oscar Onyema, CEO of the exchange, “the banking industry has really cleaned up.” And while the high profit
    margins and virtual lack of competition
    may not last long, Nigeria is attracting
    investors such as General Electric and South African supermarket chain Shoprite Holdings.

    Nigeria’s economy is expanding 7 percent
    a year, and its population of 160 million includes a growing middle class. Under the military regimes, a business operating in the country risked being nationalized or
    subjected to unfair contracts. That’s far less likely today. “The perception of risk is
    so high, when the actual risk is not as
    high,” says Mimi Alemayehou, executive vice president of the Overseas Private
    Investment Corp., a U.S. government
    agency. “The reforms are not done,” she adds, “but Nigeria is on the right path.”
    OPIC has helped bring about more private
    U.S. investments in Nigeria than in any
    other African country, mainly in financial
    services, with an increasing number in
    agriculture. She says it’s critical that the government disclose official assets, publish its annual budget, and generally improve its transparency.

    Paul Hinks, CEO of Symbion Power, a U.S.
    energy company that joined with Tony
    Elumelu, a Nigerian banker and
    philanthropist, to take over a Nigerian power plant, says, “At the time I went out there, all the naysayers said, ‘You’re mad. Why would you want to go to Nigeria?’But doing business in Nigeria is like doing business in America. The volume of talent in Nigeria is just so self-evident, and that’s what got me excited.” Despite the
    country’s power shortages and infrastructure bottlenecks, he plans to locate Symbion’s African headquarters in Lagos because of the “huge opportunities.”

    “There is a policy of free entry and free
    exit,” Dangote says of Nigeria. “You can come in, and if you don’t like what you’re seeing,you can leave and take out all your profit.” An attractive five-year tax holiday for people building industries also helps. “There are so many benefits that people are not really talking about,” he says. “Of all the places I’ve been to, I’ve never seen a place where you can actually make as
    much money as you can here.”

    Brian Browne, the former U.S. consul-
    general to Nigeria, has a more jaundiced view of Dangote’s rise. Dangote, he has
    written, is a harmful anomaly: someone who has received enormous preferential treatment in the form of exclusive import rights and high taxes or bans on imports of the goods he produces. (Browne did not
    respond to interview requests for this

    In a 2007 diplomatic cable made public by WikiLeaks last year, Browne wrote of Dangote, “To detractors, he is a predator using connections in a corrupt political economy to tilt the playing field in his favor and sideline potential competition. … Dangote is counted among President Obasanjo’s inner circle of business advisors. It is no coincidence that many products on Nigeria’s import ban
    lists are items in which Dangote has major

    Browne wrote that Obasanjo’s bans on cement, sugar, and rice imports could have been in exchange for Dangote funding the former president’s campaigns. The cable continued: “On one hand,Dangote imports significant amounts of
    U.S. produce and equipment for his
    manufacturing ventures. On the other, he has had success blocking trade and
    investment that might compete with his enterprises.”

    One prominent Nigerian business
    executive, who spoke on the condition of
    anonymity because he fears Dangote, says
    the magnate’s strategy has been to find a
    sector he can dominate and then ruthlessly
    crush competitors. The executive, who has known Dangote for years, says he’s willing to engage in predatory pricing wars and relies on the fact that his
    industries are poorly regulated. Nigeria has no antitrust legislation.

    One frequently told story relates how Dangote allegedly threatened to pull his money from a bank that was considering lending to his competitor.Newcomers, the executive says, don’t stand a chance.

    Dangote dismisses such criticism as
    exaggerated.“Competitors will say anything,” he says. Dangote admits he’s been friendly with past presidents. He serves on current President Goodluck Jonathan’s economic management team, but he denies using his government ties to carry out any wrongdoing.“Government,”he says, “is not really involved in business and has no business in any business.”

    Dangote’s friend Bismarck Rewane calls
    him a “straightforward and honest person.” He and Dangote have been friends for more than 20 years. “As a
    businessman, he’s highly competitive, and he’s driven,” says Rewane, who heads a macroeconomic and financial consulting
    firm in Lagos. “He’s desperate to win. He
    will do everything possible to ensure that he wins—within the constraints of the
    law.” Rewane paints Dangote as ruthless but moral. “Obviously those who lose out in the battle complain,” he continues. “Is this economy better off for having Aliko Dangote investing and creating capital? Yes. Is this economy stifled by
    monopolistic tendencies? Yes, but Aliko has moved from having a monopolistic mindset to that of a very aggressive competitor.”

    Nwankwo, Dangote’s former director of
    corporate finance, agrees. “People say that Dangote told the government to ban
    cement imports, but instead he saw the
    supply of limestone here, and the
    government said,‘Good idea,’ ” he says. “You can’t tell me that government gave him a handout.”

    Dangote says that if
    Nigeria wants its own industrial and
    manufacturing revolution to flourish, it needs to enact protectionist measures to help domestic industries grow, much as the U.S. did for the corporate and railroad
    barons of the late 1800s.

    Yet it’s difficult to separate Dangote’s
    calculus of the national interest from his own. Should the government shield
    domestic sugar producers from foreign competition, as it did cement, the Dangote Group will again be a primary beneficiary. He has sugar plantations totaling 100,000 hectares. “In Africa, as you’re being successful and doing things right, you’re also creating a
    lot of enemies,” Dangote says of his
    detractors, and he’s not shy about making
    new ones. He’s suing a cement competitor,
    Cletus Ibeto, over an import duty waiver and tax breaks the latter enjoyed—yet Dangote himself has benefited from a five-year tax holiday for his businesses, a perk few of his rivals have received.

    Opportunists abound in transitional economies, and Dangote may well be
    monopolizing rather than opening up the
    marketplace. In any case, he shows no sign of slowing down. His investments took a hit in the markets last year but have begun to bounce back. Last October he sold most of his stake in Dangote Flour Mills to South Africa’s Tiger Brands. He says his Bloomberg Billionaires Index rank is fairly accurate, though he has yet to list more of his holdings,which he says would increase his net worth.

    Dangote plans to sell a 20 percent interest in his cement business on the London Stock Exchange by the end of 2014, pricing it at a value of $35 billion to $40 billion. If he succeeds,the Nigerian businessman will be the world’s most valuable cement producer.

  10. beegeagle says:

    So you see how economic growth in Nigeria can impact development in Africa. DANGOTE GROUP are investing billions of dollars in cement ventures in Ethiopia, DR Congo, Cameroon, Ghana, Senegal, Zambia and elsewhere, including this US$600 million facility in Tanzania.

    Again, I took something heartwarming from the last story as well

    ” *Goldman Sachs included Nigeria in its
    Next 11 list of the most promising 21st
    century economies,and Citigroup called it a “3G,” one of its “global growth
    generators,” countries with growth”

    – Next 11 economy
    – Global Growth Generator

    The other side to the story of “corrupt and war-torn Nigeria” which the global media hegemons would never tell you about.

  11. beegeagle says:

    Wow, in today’s news…

    S.AFRICA GROWTH SHRINKS TO 0.9% in Q1 2013

    28/05 at 16h22
    by Johannes Myburgh

    South Africa’s growth slowed to 0.9
    percent in the first quarter, official data
    showed on Tuesday, a five-year low that
    is likely to also bode ill for the rest of the

    The gross domestic product (GDP) growth rate fell from 2.1 percent at the end of last year, in large part over a 7.9 percent-drop of output by the manufacturing industry, according to data from Statistics South Africa. The quarterly figure was the worst since
    a 1.7-percent contraction in 2009, and led shocked analysts to revise projected
    annual growth downwards.

    Continental powerhouse South Africa
    grew by 2.5 percent in 2012, lagging
    behind its emerging economies BRICS
    partners Brazil, Russia, India and China. The national currency the rand — already
    at its lowest point in four years — fell to
    9.73 to the dollar following the release of the latest figures — compared to 9.59 at the close of trading on Monday.

    The slowdown will have repercussions
    elsewhere on the continent and
    especially its immediate neighbours,
    according to Nedbank senior economist
    Nicky Weimar. “We’re still the largest economy in Africa and so if we’re losing momentum that’s not good news for African growth,” he told AFP.

    The continent is projected to grow by 4.8 percent this year, according to the
    African Economic Outlook, a report co-
    authored by the OECD and the African
    Development Bank.

    Southern Africa was however the worst-
    performing region on the continent with
    one of the world’s highest growth rates. Ratings agency Standard & Poor’s
    meanwhile warned last week Africa’s
    boom in recent years may be over and
    will grow moderately from now.

    Meanwhile the manufacturing slump is
    being reflected in consumer spending,
    said Weimar. “We are seeing weak numbers from the services sector. Households are becoming weary,” he added. Maintenance shutdowns in notably the petroleum and other industries contributed a negative 1.2-percent to overall quarterly performance, said Stats SA’s Gerhardt Bouwer. “There were a few weeks they stopped for maintenance,” he told AFP.

    Output by the agriculture sector also
    contracted slightly, “but the pace of
    activity in most other sectors slowed
    noticeably,” Nedbank said in an analysis. A 14.6-percent surge in mining output did little to boost the economy. “It is inflated by a very low base caused
    by last year’s long and violent strikes,”
    said Nedbank.

    Months of violent mine unrest in 2012
    halted production and left around 50
    people dead, including 34 shot by police
    in a single day. The approaching strike season in mining and other sectors has also dampened forecasts.

    The lower than expected first quarter
    figures raised concern amid the
    economy’s tepid outlook and over 25
    percent unemployment. “We were looking at 1.9 percent,” said Weimar. “Obviously we are extremely disappointed.” Nedbank expects 2.2 percent-growth this year, down from its earlier estimate of 2.6 percent.

    Meanwhile Dawie Roodt from financial
    services firm Efficient Group revised
    down its forecast to under two percent
    growth for 2013. Growth would recover slightly by the end of the year amid the global economy’s expected improvement, said Nedbank
    with a cautionary tone. “The economy appears more fragile and the outlook increasingly murky,” the bank warned.

    Last week the central bank kept the main interest at 5.0 percent, expressing
    concern over the economy’s
    “deteriorating outlook”. Inflation hovers at 5.9 percent, just shy of the bank’s six percent-threshold, but is predicted to break through the target by the third quarter.

    The weakness of the rand, making
    imports more expensive, is also putting
    pressure on prices. The trade benefits of the weaker rand are unlikely to provide much relief given anaemic global demand and domestic consumption, as well as low commodity prices and rising production costs,according to Nedbank.

    The main opposition party, the
    Democratic Alliance, slammed the African National Congress government for the “growth collapse”. “This is the strongest indication yet that this government has the wrong economic
    policies,” the party’s shadow finance
    minister Tim Harris said in a statement.

    The African Economic Outlook, which
    gives an annual bill of health on the
    continent’s economy, noted South Africa’s sluggish growth. The country struggles to keep up with dynamic economies such as oil-rich Nigeria, which is expected to grow by 6.7
    percent in 2013.

  12. Yagazie says:

    Gentlemen- even if we after rebasing our economy in 2014 we eventually become the biggest economy on the African Continent – its NO BIG deal. Why do I say so?

    South Africa has a population of just 50million people, we have a population of 160 million. Their economy is currently growing at a rate of 2-3%p.a. Ours is growing at a rate of between 6-7% per annum. Our current GDP is based on 1990 figures (23 years out of date!!) – so whichever way you look at it, the statistics are in our favour.

    Whether we like it or not, Nigeria and South Africa are in an unspoken race to be the ‘spokesperson’ for Africa and each country hopes to gain a coverted UN Security Council Permanent Seat – when the UN Security council is restructed (whenever that happens).

    Whilst having the biggest population /economy in Africa, will be a factor in decding who gets the nod for the UN Seat when it becomes available, I am more concerned with other important indices of development- like the fact that you don’t see Jacob Zuma or Thebo Mbeki or Nelson Mandela going abroad for medical treatment when they are ill – unlike our political class/rich nigerians, (see our late President Yar- Adua for example) simply because lip service is paid to Health Care in Nigeria.

    In terms of the quality and state of Infrastructure (roads, rail, ports, airports, universities, telecoms etc) the South Africans are FAR AHEAD of us. Of the ten best airports in Africa, the first 3 were from South Africa (with 6 on the ilst) and none from Nigeria.

    We have about 3,000KM of rail network, they have about 20,000KM. They have the Guatrian which is a high speed service between Pretoria and Johannesburg with speeds of about 160KM per hour, we currently have no high speed rail.

    We have a road network of about 193,000KM, the South Africans have about 300,000KM. Of the 10 best Universites in Africa, the first 3 are South African (and they have about 6 universities in the list) and none from Nigeria.

    In terms of a stable legal frame-work, banking system, stock market liquidity and Private Equity Investment, the South Africans are again far ahead of us. Our stock market (NSE) has about 200 listed companies with a market capitilisation of about $55billion dollars. The South African Stock market (JSE) has about 400 listed companies with a market capitilisation of about $929 bilion dollars.

    The South Africans are bona fide members of important economic groups like BRICS, G-20 and IBSA, we are not.

    The South African economy is currently rated at BBB (which is investment grade) by the International rating agencies (Moodys, Standard and Poor, Fitch). Ours is at BB- (which is about 3 notches below investment grade).

    The South Africans have the most diverisfied economy (mining, manufacturing, agriculture, tourism etc) in Africa. We are still reliant on one commodity (oil and gas)- albeit we are trying to diversify.

    The South Africans produce over 40,000MW of electricity (of which about 1800MW- comes from Nuclear power- the only country on the African continent with an operational nuclear power station), we are producing about 6000MW. The South Africans are currently buildlng one of the world’s largest clean coal power stations (in Medupi -Guateng) which will produce about 3600MW of power – our largest new power station (Alaoji) will produce just 1032MW of power when completed.

    South Africa has hosted the FiFA football World Cup, the Rugby World cup and the Cricket World cup for (Test Match playing nations)-we fool ourselves with hosting junior competitions.

    When it comes to millitary power, whilst we have a relatively strong Army, Navy and Airforce, – we do not have submarmarines (they do), we currently have 1 frigate (which is being refurbished at the moment) and they currently have 4 which are all active, our top millitary jet is the Chengdu F-7 fighter(3rd Generation), whilst they have the Saab Grippen Multi-role fighter (4th Generation)

    Just some food for thought…………………….

  13. jimmy says:

    Gentlemen- even if we after rebasing our economy in 2014 we eventually become the biggest economy on the African Continent – its NO BIG deal. Why do I say so?
    OGA YAGAZIE it is a very big deal let me give you a MODIFIED YORUBA PROVERB IF TWINS born on the same day into a royal family does it mean that both will wear the crown NO!
    For years all the sins of Nigeria have been HASHED AND REHASHED every single time .I live in the western world let us go back TO 1960 .Nigeria had 5 universites/ higher places of education, and how many power stations? and how many roads were tarred? Let us fast forward to 2013 53 YEars later we are constantly reminded / never allowed to forget that we have corruption/ we have power shotages / we will split 1999/2009/2015/ 6019. We are never told about the bright /good things going on in Nigeria when we are told it is because these things are no longer worth hiding.
    Nigeria has the largest combined banks in Africa . period . One of the mafia GANGSTERS when asked why he robbed banks for a living he said because that is where the MONEY is?
    Dangote is not the only Billionaire in NIGERIA HE IS JUST THE MOST HIGH PROFILE ONE WHO has made it a point to reinvest 99.999% of his investment back into NIGERIA.
    Nigeria’s real estate is amongsts the most expensive in the world even with or without corruption this is because the market calls the shots .G o to port-harcourt/ abuja/ lekki/ anambra / calabar and see how much is being developed and how much it costs.
    Nigeria has already SURPASSED South AFRICA GDP wise even they know it RECALIBRATION OR NO RECALIBRATION . The challenge for Nigeria is management/ prudent allocation of resources, and infrastructure growth. The country that is no.1 will GET THE LIONS share of INVESTMENT. Please ask British AIRWAYS how much they make on those DECEMBER FLIGHTS TO DUBLIN ( IRELAND) IN December compared to LONDON / LAGOS. We are still waiting for the day they will cancel flying to NIGERIA IN DECEMBER yeah right.

  14. ifiok umoeka says:

    Greeting fellow citizens beegzland, these topic has made for an interesting read as we as a departure security related issues. Let me just say that I remember when we were having a buy this buy that talk and I said we needed to pay our attention to the economy so we could afford to pay for the toys we were clamoring to buy. With the money, we wouldn’t care about ex US coast guard ships or that UK or China should give us so equipment! We’d just buy them on terms that are favorable. It’s amazing how the people that harass us on human right but beg and bribe to sell all manner of arms to some of the foulest abusers in the persian gulf and south east asia. Remember that the US is the highest exporter of arms. People will take u serious if u have some good cash. We use to get frowns and disapproving looks when we wore a suit jacket over a pair of jeans or if u folded the sleeves of your shirt and had a tie on. Now because those guys at google and apple dress like that and president Obama make rolled up sleeves look cool, it’s suddenly appropriate! Guys who write the cheque draws the line. The Nigerian people are truly a great people to grow economically in the conditions we find ourselves, oil or no oil. Nigeria is capable growing in the short term at btw 20 to 30% if we have the our leaders, institutions, laws and infrastructures are in place. We desperately need to add value to what we produce in this country and we need to equip our young people with the right tools to get this down. We need a proper health sector to keep our experienced and hard working citizen as able as possible. Nigerians deserve this, being biggest economy will only be the icing on the cake. Shout out to all those brothers and sisters who do odd and even jobs, endure abuse and deprivation just to send some hard earn money home, who don’t ask for political concessions to give aids or invest. Keep. The flag flying

  15. jimmy says:

    He who makes the most money is the big dog.Please money is directly tied to security and oppression .Please let us take a look at Malawi who has no choice but to agree to everything that is dictated to her GAY RIGHTS CHECK sell the presidential plane check. Nigeria represents a totally different case that is why some not all will represent only the bad news. it is hide to represent only the bad news when the most unlikeliest of sources keep upgrading your economy STANDARDS AND POOR, MOODY, Goldman Sachs.
    No one has said Nigeria does not HAVE IMMENSE CHALLENGES , but with the same intensity that is used to report the bad news about Nigeria please report the same good news.
    Lastly less than a month a month ago allegedly 2,000 homes were destroyed it took the combined efforts from fellow bloggers the slow moving F.G AND SATELLITE to……. wait a minute 150 houses less than 10% no mass graves any retraction nope. This is the same , however it is nIGERIANS WHOM AT THE END OF THE DAY WILL RESPONSIBLE FOR THEIR OWN ECONOMIC DESTINY.

  16. Henry says:

    Oga jimmy, thank you for your comments.

  17. Yagazie says:

    Oga Jimmy, much respect for your comments. Please note that I am definitely not trying to run Naija down. The fact is that Naija is a Proud country with vast human and natural rescources and and as such we don’t take cr*p from anyone – and rightly so.

    The point I was trying to make is simply this – lets not shoot ourselves in the foot by giving our detractors the opportunity to possibly deny us what is rightfully ours. Do we deserve to have a UN Security Council permanent seat ? – Definitely.

    However our detractors couldl easily say-‘yes you have the biggest economy on the african continent and yes you have the larget population on the african continent and as such meet some of the criteria ..however…..there are other indices which we use such as ‘x’ or ‘y’ and ‘z’ and your country fails on these indices.- Do you get my drift?

    In a nushell lets ensure that there is no reason to be denied what is rightfully ours.

    • jimmy says:

      i hear you, I really respect your comments . let me tell you something about myself .I live in the states and in most cases I have supported better relations between the STATES and Nigeria for some of the most obvious reasons. I would be the first person to tell you that Nigeria sometimes to me is the country I LOVE TO HATE. I love Nigeria especially when I am not there and when i am there I hate it sometimes.
      I am glad you mentioned the indices to which Nigeria is held up and they should be held up to those STANDARDS of good GOVERNANCE, professional armed forces.The point is this when Nigeria i.e the f.g represented by GEJ does something ( stupid) ALAMS comes to mind it is broadcast all over the international news. When something positive comes out from Nigeria is (UPGRADE IN FINANCIAL RATINGS ) very grudging almost quietly acknowledged.
      I respect oga peccavi sitep’s comments a lot but as far as the Nigerian MILITARY divulging information like they used to do in the past it would of been a colossal mistake. Most of the time the western media has already made up their mind as to what they are going to print ” i call it the cut and paste” Nigerians on the other hand do not help matters by constantly beating Nigeria down so I said Nigeria should not apologize how they handle borno.
      Look at China PRESIDENT OBAMA WILL VISIT China and has already visited Saudi Arabia a country known for supplying oil and ISLAMIC extremism to the world with a deafening ABYSMAL , PATHETIC record on human rights and corruption and yet .he will not come to NIGERIA because of what again?. When Kerry goes to SAUDI Since his wife speaks seven languages let us see whether his wife follows along.
      OGA YAGS I respect your comments but in less than 10 years we have put three satellites in space.We are slowly building power stations,we are reforming the armed forces, we have had three back to back to back elections and we are gearing for our fourth ,are we perfect no? we are not.
      I believe when Nigeria gets it’s financial / judicial/ power/ house in order all these western countries will be falling over themselves even more than they are now. It is the hypocrisy that i can’t stand that is why I said NIGERIA FINANCIALLY NEEDS BE NO.1 NOT 2 BECAUSE MONEY TALKS AND BULL—- WALKS.

  18. ifiok umoeka says:

    thanks oga jimmy, your contributions are def and top notch too. u see, our distractors will always point out our failings but never show our successes. like i’ve been saying, that’s our job. we may not be where we want to be, but we are not where we use to be. can you imagine that the Brits keep having to defend their conduct in Afghanistan accused of running their own Guantanamo! why are they suddenly interested in Somalia? i think it has something to do with the reported 100bn barrels of crude in Punt-land and trillions of gas of the coast of the horn of Africa! brothers, the name of the game is INTEREST! i remember telling my dad that the will be no intervention in Syria at least for a while and he took time to point out Iraq and Libya to me.over 2yrs and 70,000+ dead and Secretary Kerry when asked why there has been no intervention in Syria yet had this to say… ‘ its complicated’ President Obama has like you said visited some of the crudest and corrupt-most of countries yet he finds excuses to stay away for 5yrs from a country he calls partner! WE DON’T OBAMA’S VISIT TO VALIDATE US AS A PEOPLE. if i where president of Nigeria, i would introduce the diplomatic doctrine of RECIPROCITY. you see a country is not about the leaders alone, its about the people. i hope our leaders can understand this.

  19. Yagazie says:

    Oga Jimmy, your response is noted. Please re-read my initial entry and my response to your comments.

    As far as Africa is concerned, we are in a race with South Africa as to who the continent’s representative should be. Having the biggest economy/largest population are important factors- but they are not the determining factors. Yes we have come a long way – but the fact still remains that compared to our main competitior (South Africa) we are still way behind using the indices I had mentioned.

    The South Africans are very concious of the fact that Nigeria will become the biggest economy in Africa within the next 2-3 years (present growth rates/reasonable GDP rebase permitting) so what are they doing?- Simple – they are trumpeting themeselves as the ‘Gateway’ to investment in Africa, based on (i) their sound physical infrastructure (ii) the size, depth and liquidity of their stock exchange (JSE), (iii) their diverified enconomy (iv) sound legal /financial institutions (v) their being the only African Country with membership of international organisations like BRICS, G-20 and IBSA.

    Thus we must thus see how we can narrow/close that gap so that using any criteria- Nigeria will be the automatic choice for leadership of the African Continent. It’s as simple as that.

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