Nigeria: Dangote's U.S.$500 Million Sugar Complex and Quest for Sufficiency

26 April 2021
opinion

Abuja — As an avid observer of developments in the global economy, I was taken aback recently when international trade watchdog, World Trade Organization (WTO), recently released its thought-provoking statistics. According to WTO's data on "Leading Exporters and Importers of Commercial Services for 2020", Nigeria was ranked number one importer in Africa and 25th largest importer in the world, while Egypt emerged second on the continent and 28th globally.

Meanwhile, the big economies of the world--United States, China, United Kingdom, Japan, India, Singapore, that made it to top positions of the "leading Importers", also featured on top the list of "leading exporters". The shocking and disturbing aspect of the report that should elicit national discourse in Nigeria is: when it came to ranking of top exporters in the world, Nigeria was conspicuously missing while Egypt and Morocco made it to number 26 and 27, respectively.

These two African countries were rated ahead of Nigeria in exports. This is very pathetic. Nigeria--so-called giant of Africa, ignobly got the crown of infamy as the "dumping ground" of the world, because when you're consuming via importation without corresponding exportation, your economy is in doldrums. We only export raw crude oil without the capacity to refine--even for our local consumption. We are the only OPEC-member country that imports refined petroleum products.

The million-dollar question here is: how can you export products and services that you're yet to achieve self-sufficiency in? This is the big national question that African industrial giant--Dangote Group, is providing answers to. From building the largest refinery in Africa--to help Nigeria achieve much-needed self-sufficiency in local refining of Premium Motor Spirit (PMS)--and its byproducts, to igniting what I describe as sugar revolution in the country.

The ongoing construction of Dangote Integrated Sugar Complex in Tunga, Awe Local Government Area of Nasarawa State, is another industrial wonder to behold. In line with the Nigerian Sugar Master Plan (NSMP), especially Backward Integration Project(BIP)--one of the critical aspects of the master plan, Dangote Group via one of its subsidiaries--Dangote Sugar Refinery, is building $500 million worth of sugar complex.

The Integrated Sugar Complex, will comprise 60,000 hectares of sugar plantation and industrial complex with capacity to crush 12,000 tons of cane per day (tcd); two sugar factories with projected capacity to produce 430,000 tpa of refined white sugar--representing about 30% of Nigeria's sugar consumption. Ninety megawatts of electricity will be generated in the Complex for the Company's use and that of neighboring communities, using ethanol. Some 500km of roads will be constructed to enhance transportation within the complex and adorning communities.

Another landmark stride of this project is: for the first time in history of Nigeria, drip irrigation will be installed on a commercial scale to substantially improve the yield of sugarcane, and simultaneously conserve water and fertilizer consumption. When fully installed, both plants will have Ethanol Distilleries, to produce ethanol from molasses. The ethanol will be blended with gasoline at Dangote Petroleum Refinery to have greener fuel. You can see the synergy.

The Dangote Integrated Sugar Complex is expected to commence production by 2023, with potential to create more than 150,000 jobs. When fully operational, this project will not only uplift the economy of host state--Nasarawa by enhancing its Internally Generated Revenue (IGR), but reduce Nigeria's dependence on importation of raw and refined sugar.

Quoting Governor of Central Bank of Nigeria (CBN), Godwin Emefiele, who was wowed when he visited the site, Nigeria spends between $600-$1 billion dollars annually on importation of sugar and its raw materials alone.

The Apex bank indicated its intention to place importation of sugar and wheat on its forex restriction list because Federal Government considers wheat and sugar as second and third most important commodities after rice, respectively, in its strategic food policy. But there must be a deliberate attempt to localize its production 100%.

Nigeria is one of the sub-Saharan Africa's largest importers of sugar. To curb this ugly trend, the ambitious project embarked upon by the Dangote Group, is a welcome development and provides ray of hope for the nation's goal via Nigerian Sugar Master Plan, to attain self-sufficiency in local sugar production.

The import of this landmark initiative is beyond imagination, because it has the tendency to revolutionize Nigeria's sugar industry, create much-needed jobs for our teeming youths, reduce pressure on the limited foreign reserves and strengthen the naira.

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