‘If subsidy is removed, a dollar might be N500’, says Dangote

One of Africa’s biggest businessman, Aliko Dangote  said Nigerians should  invest at home and create jobs stating that 5 to 10 people can make Nigeria a great economy.

According to Vanguard, Dangote, who said this in an interview also said Nigeria will not have meaningful development until power problems in the country is sorted.

 

Here are 10 things we learnt form his interview;

1. Dangote says subsidy should not be removed as it will affect foreign exchange. 

“The issue with subsidy is that government needs to block all loopholes. If there’s no subsidy, it will affect our foreign exchange, we’ll end up buying a dollar at N500 because there’s no VAT on petroleum products. That’s why the import of petroleum products is taking about 30 per cent of our foreign reserve. We just need to make sure that there’s no siphoning of money.”

2. He states that if subsidy is removed, something must be put in place for the masses.

“It’s good enough if they remove the subsidy, but you can check with neighboring countries like Senegal. If a poor person in Senegal can afford to pay subsidy, why can’t a poor person in Nigeria afford to pay. I think there must be something for the masses, which should be in terms of power, social insurance, good education system, good roads etc.”

3. He said investing in Nigeria is a big risk and does require determination and seriousness.

“These things are humanly possible and we should be able to do them. It’s not really the work of the government to make a country prosperous, it’s the work of individuals because the duty of the government is to facilitate, but government will not have the money to invest.”

4. The government is to develop the country but individuals must contribute in sustaining the country and making it prosperous.

“That’s why it’s shameful that some Nigerians go and keep their money abroad. It is very difficult when we have a huge chunk of our money abroad and we want foreigners to come and invest. They won’t believe that the environment is good. It won’t work that way.”

5. People should pay tax to contribute to the country. Tax helps the country develop.

“People don’t pay taxes because they don’t see what they are being used for. Initially, Lagosians were upset about tax payment, but they realised that it’s important to pay taxes because they started seeing that the money is being used judiciously. The issue of not paying taxes is really reckless.”

6. People go into business blindly. One should know about the business one is delving into.

“That’s the only way you can succeed. That’s the biggest mistake most people are making. I don’t think that most of the people that have invested in power really understand what it is. It involves three things; generation, transmission and distribution and all the three require heavy investment. There are a lot of issues that we have to resolve and I think with seriousness, we’ll be able to do them.”

7. Nigeria should diversify the power generating sector and look into other things that can generate power.

“We have gas, but we shouldn’t use gas alone. We took the decision that by the end of the year, all our cement plants will be using coal. The coal is there and Nigeria will not be competitive in exporting it because we don’t have the infrastructure to take these coal for export. We’ve started using coal and there’s no emission, not a single dust anywhere. Technology has changed, 38% of power being generated in America is by coal. In our own operations, we’ve discovered that running on coal is cheaper than gas. We need to see how we can build a lot of infrastructure because that would help to open up the economy and make us independent. The government has to sit down and find a solution to power.”

8. The government has to sit down and find a solution to power.

“We will not have any meaningful development till we are able to sort out the power issue. We won’t have an inclusive GDPA unless we tackle power. The power issue is a great one and it’s preventing everyone from progressing. In Uganda, they increased the power to 230 Megawatts and the next year, their GDP grew by additional 4%.”

9. Time management is very important

“The biggest problem we have in Nigeria is that we don’t quantify time. That’s why people will sit in traffic from here to Ikeja for two to three hours. If you invite me to a place and if I’m totally free and available, I’ll look at how many hours it will cost me. If it will take five hours of my day, I won’t go except I’m going for business purposes. That’s my policy. I put a lot into consideration and do some calculations, if I’ll need to send someone to represent me, I do that.”

10. Nigeria should diversify into agriculture.

“I think there will not be an improvement in job creation unless people go into Agriculture. I know even in Agriculture, there’s money. there’s so much land and water here. God has given us these things and we have to use them. Today, Ethiopia is growing rapidly, but the mainstay of their economy is agriculture.”

One comment

  1. I might not often agree with him, but he raises a good point about the possible economic impacts of removing the subsidy, such as the Naira falling so steeply. This is just one potential outcome of a the final decision made without proper thought for the effect on Nigeria at large.

    Of course, considering how long the current administration has taken to decide one way or the other, we can be sure that a lot of thought is being put into understanding what place the subsidy will have in Buhari’s Nigeria.

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