Just as Nigeria, Africa’s largest economy by GDP raised a USD 6 billion loan from China, Aliko Dangote, the Chairman of Dangote Industries is also boosting his investment plans with equal leverage positions.
Dangote just raised USD 2 billion loan from the Industrial Commercial Bank of China Ltd. The loan will be channelled into the construction of two cement factories in Nigeria. In a sketchy statement he released to Reuters in Lagos yesterday, Dangote said: “The interest rate is okay, quite favourable with me, it’s for my two cement companies that we are establishing in Nigeria.”
His Dangote Cement [DANGCEM:NL], controls more than 60% of the local cement market. His expansion into Nigeria, Benin, Ghana, Senegal, South Africa and Zambia in Africa, would see him controlling the largest market share in Africa in no time. Dangote’s focus to build more cement factories has been praised by investment analysts as a wise decision because, he will be the number one profiteer in the infrastructure boom that African countries will be investing in for the next three decades.
Because of the pivotal role his companies play in Nigeria’s foods and commodities market, Nigeria Central Bank has favoured Dangote, giving him preferential treatment to access Forex. A move criticized by BUA Cement, Benue Cements his smaller rivals/importers.