Dangote’s investments in states

| January 7, 2013 | 0 Comments

 

Elementary economics teaches that there are key considerations an entrepreneur or manufacturer makes before setting up a business and that prominent among these is the availability of critical infrastructure such as power and good road network.

 

Aliko Dangote, Africa’s richest business mogul, is an investor and entrepreneur par excellence. The Dangote Group is a business empire whose investments and business footprints traverse virtually all sectors of the economy. As an investor, Dangote sites his businesses where infrastructure and other factors of production are available to make him get good returns on his investment and also maximise profit.

Ours is a country where governments at various levels see infrastructure provision for the people as privilege, which is why some state governments don’t give a hoot about the state of their infrastructure.

It gladdens our heart, however, that some state governments which see beyond the social imperatives of critical infrastructure, especially roads, have gone ahead to construct new roads and also rehabilitate existing ones. These are states where governance understands not just its social contract with the people, but also the wisdom and economic viability of enabling the environment for investment.

We are not surprised, therefore, that the Dangote investment searchlight found Edo, Ogun and Cross River States havens for its fertiliser and cement manufacturing companies. In Anambra State, there is a $10 billion investment by SABMiller, which is expected to produce local gin.

For us, the choice of Anambra and Edo for investment is instructive because it provides good testimonials for the quality of leadership in the states. It also underscores the subtle competition by the states to attract investment.

A close look at the global economy takes this even beyond sheer competition. Nigeria’s macro-economic indices present her as a beautiful bride for both local and foreign investors, and more so, given that while western economies are contracting, Nigeria’s is expanding by way of GDP growth.

It beats our imagination that only a few states of the federation seem to see the bigger picture of growing appetite for investment in Nigeria, or even the social and economic impact of roads infrastructure on their local economy.

It is pertinent for us to point out, for the sake of emphasis, that providing infrastructure attracts local and even foreign direct investment to the states which, in turn, creates jobs for the locals.

Additionally, creating jobs for the people means increasing the state governments’ internally generated revenue (IGR) through payment of personal income and company taxes. This is besides the social stability and peace that the populace will enjoy as crimes and social upheaval will be significantly reduced.

We believe that when critical infrastructure, especially roads, are provided, they will enhance housing development, open up new towns, decongest the city centres, and reduce pressure on existing and ageing infrastructure.

 

Culled from :Here

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