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AfDB President, Adesina Addresses Concerns Over Dangote Refineries

Dr. Akinwunmi Adesina, President of the African Development Bank (AfDB), has voiced strong concerns regarding the recent controversy surrounding Dangote Refineries, emphasizing the negative implications it has on Nigeria’s global image and investment climate.

Dr. Adesina highlighted that the existence of monopolies is often a result of high barriers to entry and substantial capital requirements. He questioned the feasibility for many individuals or companies to venture into large-scale infrastructure projects like railways or refineries, particularly on the scale of Dangote Refineries.

“For a nation that has been importing refined petroleum products for several decades, the abnormal has simply become very normal,” Dr. Adesina remarked. He stressed that no prudent investor would undermine a $19.5 billion investment by competing with importers. Manufacturing, he noted, is inherently expensive and risky, more so in Nigeria’s challenging economic environment, marked by policy uncertainties and frequent reversals.

Addressing concerns about competition, Dr. Adesina stated, “Competition is good for everyone. But is Dangote Refineries anti-competitive? What is the evidence?” He pointed out that Dangote Refineries has not prevented other companies from setting up refineries, questioning why others have not done so for several decades and if it was Dangote who impeded them.

Dr. Adesina argued that Dangote Refineries should not be expected to compete with importers of petroleum products, advocating instead for importers to establish local refineries and compete by refining in Nigeria. “That is fair and justified competition,” he said.

He underscored the importance of supporting local industries, especially one as significant as Dangote Refineries, which represents a major achievement in Nigeria’s industrialization. Dr. Adesina emphasized the broader benefits of such investments, including domestic supply security, development of globally competitive industries, creation of jobs, reduction in foreign exchange expenses, and strengthening of the Naira.

Dr. Adesina condemned the disparagement of Dangote Refineries, describing it as self-defeating and detrimental to Nigeria. “Who will want to come and invest in a country that disparages and undermines its own largest investor?” he questioned, warning that such attitudes send a negative signal to potential investors.

“In a time when investing is tough and pettiness is easy, it sadly sends a signal that the price for sacrificing for Nigeria is to get sacrificed,” Dr. Adesina concluded.

The African Development Bank remains committed to supporting industrialization and sustainable economic development across the continent, and calls for a conducive environment for investment and growth in Nigeria.

 

 

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