Akinwumi Adesina, President of the African Development Bank (AfDB), has expressed shock over the Dangote Refinery issue involving Nigerian government agencies, stating that it is generating negative global perceptions of Nigeria.
Recently, the Chief Executive of the Nigerian Midstream and Downstream Petroleum Authority, Farouk Ahmed, said the diesel produced by the $20bn Dangote refinery is inferior to the ones imported into the country.
Farouk Ahmed also said that Nigeria must rely on something other than the Dangote refinery for its fuel supply.
But, reacting yesterday, AfDB President, Akinwumi Adesina, said this whole disparaging of Dangote is uncalled for.
“It is self-defeating. And it is very bad for Nigeria.
“Who will want to come and invest in a country that disparages and undermines its own largest investor?”
Adesina said investing is tough, but pettiness is easy, adding that what is happening is sending a signal that the price of sacrificing for Nigeria is to get sacrificed.
The AfDB boss said, “Competition is good for everyone. But is Dangote refineries anti-competitive? What is the evidence?”
He said monopoly often exist where there are high barriers to entry or high capital costs.
“How many individuals or companies can do railways? How many can do refineries of the scale of Dangote Refineries?
Adesina added that in a nation that has been importing refined petroleum products for several decades, the abnormal simply became very normal.
“No smart investor would make a $19.5 billion investment and want it to be undermined by importers.
“To manufacture is extremely expensive and risky. This is even more so in Nigeria, given the very challenging business and economic environment, fraught with policy uncertainties and policy reversals, and where the self-defeating default mode of “simply import it” is always so easily rationalized and chorused to solve any problem.”
He added that Dangote refinery is more than simply delivering the cheapest product to the market.
“It is about domestic supply security, driving (and yes, protecting) globally competitive industries, maximising forward and backward linkages in the local economy, job creation, reducing forex expenses, and shoring up the naira.””
Adesina said competition is good for everyone, “but is Dangote refineries anti-competitive? What is the evidence?
“Has Dangote refineries prevented any other company from setting up refineries? Why have others not done so?
“How come they have not done so for several decades? Was it Dangote that held them back?
Adesina said Dangote refineries surely cannot be asked to ‘compete’ with importers of petroleum products.
“That is not competition. Let the importers set up local refineries and compete by refining in Nigeria. That is fair and justified competition.
“We cannot and must not undermine, disparage, or kill local industries, talk less of one that is of this scale—a jewel of industrialization in Nigeria.”
Vanguard
