Aliko Dangote and Akinwumi Adesina

ADVERTISEMENT

“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?,” Mr Adesina was quoted as saying.

By Mary Izuaka

The president of the African Development Bank Group (AfDB), Akinwumi Adesina, has said the push by the president of Dangote Group, Aliko Dangote, to get the government to ban fuel import following the commencement of his refinery is not anti-competitive since the businessman did not bar any other entity from establishing refineries in Nigeria.

Mr Adesina made the assertion in the messages he circulated to some eminent Nigerians, which were included in a post on X by Femi Otedola, the chairman of FBN Holdings and Geregu Power on Tuesday.

According to the post, Mr Adesina noted that monopoly often exists where there are high barriers to entry or high capital costs.

ADVERTISEMENT

“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?,” Mr Adesina was quoted as saying.

“But 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.”

The AfDB’s chief’s reaction follows a claim by authorities in Nigeria that Mr Dangote, who built the refinery – Africa’s largest – at the cost of $19 billion is seeking to bar the importation of petroleum products in Nigeria.

Before the Petroleum Industry Act (PIA) was signed into law in August 2021 by ex-president Muhammadu Buhari, the bill originally sought to allow only refinery owners to be the importers of fuel into the country.

The part granting that privilege to refiners was expunged from the legislation after a backlash from stakeholders before the PIA was approved.

Mr Dangote, who is Africa’s richest man, has also had a face-off with regulators, IOCs and NNPC Ltd, the state oil firm, over issues ranging from alleged sabotage of oil supply, which has constrained the smooth operation of the refinery that only started this year.

Mr Adesina highlighted manufacturing challenges in Nigeria in the post, describing the business and economic environment as fraught with policy uncertainties and reversals.

“To manufacture is extremely expensive and risky,” the post said.

“The self-defeating default mode of “simply import it” is always so easily rationalised and chorused to solve any problem.”

Companies registered under the Corporate Affairs Commission (CAC) as providers of goods and services in the downstream sector of the Nigerian oil and gas industry are eligible to apply for petroleum products importation permits.

Last month, the vice president, oil and gas at Dangote Industries Limited, Devakumar Edwin, accused IOCs of doing everything to frustrate the survival of Dangote Oil Refinery and Petrochemicals.

He said the IOCs are deliberately frustrating the refinery’s efforts to buy local crude by jerking up the high premium price above the market price, thereby forcing it to import crude from countries as far as the United States, with its attendant high costs.

On Sunday, a frustrated Mr Dangote told PREMIUM TIMES in an exclusive interview that he is willing to sell his multibillion-dollar oil refinery to NNPC Ltd if the latter is willing and able to pay for it.