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Last Updated: Thursday, 19 April 2007, 14:29 GMT 15:29 UK
Nigerian wealth fails to trickle down
By James Whittington
Business reporter, BBC World Service, Lagos, Nigeria

"This is the richest man in Africa," says Femi Otedola as he walks out of the offices of Aliko Dangote.

Africa's perhaps richest man invests in every area of the economy and harbours political ambitions.

On the ninth floor of the Dangote Group headquarters in Lagos, Nigeria's most successful businessman has a panoramic view of the sprawling urban mass, which makes up Nigeria's commercial capital.

His visitor, Mr Otedola has made a fortune from trading fuel and petroleum products in Nigeria, but Mr Dangote is in another league.

His business empire spans the economy. He dominates the markets for sugar, cement, rice, pasta, textiles and salt, and he is big in transport, oil and gas.

"I think I have to be rated by Forbes magazine first before I can be [called] the richest man in Africa," says Mr Dangote modestly. "But, you know, I'm comfortable."

New investments

Mr Dangote has come along way from his early days of trading commodities in his home town of Kano in the north.

We have had a generational change in business and this is now going to happen in government
Aliko Dangote, Dangote Group

He recently turned 50 and has listed two of his 13 companies on the Nigerian stock market. His stake in those two alone is worth more than $4bn (2bn).

In politics, as in business, he is also a powerful player. He is not ashamed to be financially supporting President Olusegun Obasanjo's ruling People's Democratic Party and he is confident that its candidate Umaru Musa Yar'Adua will become Nigeria's next president.

"I am close to people in government because I am one of the big businessmen in Nigeria," he explains. "If we don't have the right people there then [all the] money I have is useless. If the country turns into another Zimbabwe, for example, then I will become a poor person."

For now, Mr Dangote is confident about the future and he lists some of the $9bn of investments in Nigeria he is currently planning, including the world's biggest sugar refinery, a 300,000 barrels a day oil refinery and a massive 5,000 megawatt power project.

Widespread poverty

Away from Mr Dangote's big air-conditioned offices, on the hot and humid streets of Lagos, Nigerians are crying out for someone to take the lead in providing basic services like electricity.

Femi Kuti
Femi Kuti believes the rich and powerful abuse trust

The most that can be expected from the government's power provider Nepa (known locally as Never Ever Power Available) is a few hours a day. Those who can afford it have diesel generators.

The majority have to make do in the dark or buy candles. Despite promising to fix Nigeria's chronic power problem at the start of President Obasanjo's tenure eight years ago, nothing tangible has been achieved.

The private sector in Nigeria has benefited tremendously from the economic reforms that have taken place over the past few years. The introduction of mobile phones, changes to the banking sector, the removal of Nigeria's once crippling foreign debt, and the country's first credit rating have created an environment where business can prosper.

But most people have yet to feel the change. The majority of Nigerians live under a poverty line of less than a dollar a day.

The former finance minister Ngozi Okonjo Iweala, who is widely credited with pushing through the reforms, argues that the provision of basic services will have to be a priority for the new government.

"[President Obasanjo's] legacy is to have laid a platform of macro-economic stability upon which the next administration can now build to solve the micro-economic problems," she says from Washington.

"And whilst people may say 'yes, you did these reforms but our service delivery has not improved' - which is true; we still have problems with light and water and so on - it is a sine qua non that if that macro-economic stability has not been put in place then you cannot move on the micro-economic issues".

No trust

Across Lagos from the Dangote Group is Nigeria's most famous nightclub, the Africa Shrine. As part of the legacy of the late but legendary Afrobeat musician and political activist Fela Kuti, the Shrine is a social club by day and a music venue by night.

At the back of the stage in his dressing room, Fela's eldest son Femi is practising his trumpet. He has a different view when it comes to the dividends of democracy.

"It hasn't worked," he says.

"People are poorer, things in the market are getting more expensive, life is getting more difficult by the day."

"And when these people get into power they never fulfil their promises. You see them with their big cars, they buy houses in England or America, they give their kids the best education, but the crop of the people, the masses themselves, they lose."

Nigerians are used to being let down by their governments. Despite being Africa's biggest oil exporter, the country has fallen far behind other developing countries.

Most people blame corruption.

Since independence from Britain in 1960, an estimated $400bn of oil revenues have gone missing, presumed stolen, by the military and political elite.

But that could be changing.

Nigeria's Economic and Financial Crimes Commission (EFCC), set up by President Obasanjo a few years ago, has had a number of notable successes in prosecuting former high ranking officials and recovering almost $2bn of money stashed abroad.

Nigeria still languishes close to the bottom of international league tables on corruption, but there is a new view in Nigeria that if you do steal you could get caught.

Catching up

Back at the Dangote Group's headquarters, Mr Dangote keeps a close eye on his computer screen, which displays the latest world commodity prices. He thinks that if the former governor from the northern state of Katsina, Umaru Musa Yar'Adua, does become Nigeria's next president then an important landmark will have been achieved.

Not only will it be the first time a civilian government hands power to another civilian government, there will also be a generational handover. The former military strongman President Obasanjo is 70 years old. By contrast the former academic Mr Yar'Adua is 56.

"We have had a generational change in business and this is now going to happen in government," says Mr Dangote. "And we need it.

"If you look at our generation, we have done extremely well [in business]. The generation before ours hasn't done well at all, In fact, they were the worst ones. And the generation before that was just concerned about local issues because there was no such thing as globalisation back then".

Whether or not Nigeria can catch up with the rest of world will depend on whether the next government and its allies in the business world can turn their success into something that benefits a broad swathe of their fellow 140 million Nigerians, rather than merely the fortunate few.

BBC World Service speaks to Aliko Dangote
"I am close to people in government because I am one of the big businessmen in Nigeria."

Nigerian poll boycott scuppered
19 Apr 07 |  Africa


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