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Nigeria's future will be home grown

Article - December 10, 2012
You take a country in which agriculture is the primary economic activity, that is home to 20 per cent of Africa's total population and that has doubled its GDP over the past 13 years to grow at a current rate of 7.4 per cent, and most people would expect to find a market of hungry consumers of staple foods and whatever processed products can be made from them
ALHAJI ALIKO DANGOTE, CEO OF THE DANGOTE GROUP
Such has not been the case with Nigeria, unfortunately, with its colonial legacy of vast natural resources shipped away to Europe while foreign manufactured goods fill the shelves at home.

This has given rise to anomalies in a country that still must import the wheat it uses to make its bread. But the Minister of Agriculture and Rural Development, Dr Akinwumi Adesina, is betting on home-grown crops such as cassava to start putting things right. “I believe that as the largest producer of cassava in the world, Nigeria must become the largest processor in the world,” he has said.

His ministry has backed a campaign encouraging commercial bakeries to use 20 per cent of cassava flour in bread dough. Meanwhile, China is set to import 1.1 million metric tonnes of Nigerian cassava chips. Of course, transforming a stubby, tuberous root into fine powder or prawn crackers requires major investments in processing technology. Nigeria has acquired low-interest financing that will allow the private sector to acquire 100 large-scale integrated rice mills, and is promoting the use of locally produced sorghum in high-energy food products.

 In addition to being the road map to Nigeria’s economic future, diversification is a strategic option that has paid off for any number of conglomerates that include processing and distribution of food products in their brand portfolio, and nowhere more extensively than at the Lagos-based Dangote Group. Founded in 1981 as a trading group specialising in cement, early success allowed founder and CEO Alhaji Aliko Dangote to expand his trading activities to encompass sugar, flour, salt and fish. In 1999, he made the decision to build from the ground up a manufacturing operation that could meet the ‘basic needs’ of Africa’s vast and fast growing population. Immediately he set his engineers to work constructing sugar refineries, pasta-making plants, and flour and semolina mills, out of which come the products now being marketed through 13 Nigeria-based subsidiaries, plus 14 more in other African countries, creating a gross turnover of ca. $3 billion (£1.88 billion) in 2010.

Another instance of foreign initiative making an impact in the food products sector is the large-scale Seven-Up bottling and distribution operation that now employs 3,500 people. It was founded by a Lebanese national named Mohammed El-Khalil who came to Nigeria for the first time in 1926, and whose son, Faysal El-Khalil, is the company’s current chairman.

Nigeria is likewise the location for the largest overseas subsidiary of the British firm PZ Cussons, which takes its name from the two partners – British “P” and Greek “Z” – who set up a trading post in Sierra Leone in 1879. Twenty years later, they were ready to relocate in Nigeria. By the 1930s, descendants of the two Kiplingesque partners acquired rights to the scent known as “Imperial Leather” which remains the flagship brand for the firm’s 30 or so product lines, mostly specialising in personal care and grooming aids, but also with subsidiaries in white goods and dairy drinks for the Nigerian market.

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