Key Takeaways:
- Dangote Industries may cancel one or two planned businesses, including steel, to increase investment in power.
- The group plans to invest more than $10 billion in electricity generation across Africa.
- Aliko Dangote says reliable power is critical to creating wealth and reducing energy poverty on the continent.
Dangote Industries may scale back its planned investment in steel as the group redirects capital towards a more than $10 billion power investment across Africa, Aliko Dangote said.
Dangote, president of Dangote Industries, disclosed this during an interview with Al Jazeera on Monday, saying the company was reviewing some of its businesses as part of a broader strategy to spread wealth and expand access to electricity across the continent.
The group is considering cancelling one or two businesses, including steel, to free up capital for power investments, Dangote said.
“We’ll invest in power. Actually, there’s one or two businesses that we might cancel, like steel, and we’ll put the money in power. We want to invest over $10 billion in power,” he said.
Dangote said the decision reflects the importance of electricity to Africa’s economic development, arguing that the continent cannot create enough wealth while hundreds of millions of people remain without reliable power.
Dangote shifts focus towards power
Dangote said the group’s decision to increase its focus on power is part of a wider approach aimed at getting more people involved in business and spreading economic opportunities.
“It’s about spreading the wealth. It’s about getting more people in the business. It’s about corporate governance. That’s the direction,” he said.
The billionaire said Dangote Industries expects major changes across Africa over the next three to four years and wants power to be a key part of that transformation.
He said Africa should not allow more than 600 million people to remain without access to electricity when power is essential for businesses and industrial development.
“It’s something that we Africa should not really allow, over 600 million of our people to [be] in darkness. Power is key to creating wealth,” Dangote said.
The planned investment would represent a significant shift in capital allocation for the group, which has interests spanning cement, refining, fertiliser, petrochemicals and other industrial businesses.
Dangote did not provide details on which steel projects could be cancelled or how the more than $10 billion power investment would be distributed across African countries.
Power investment targets Africa’s energy gap
Dangote’s comments come as electricity shortages remain a major constraint on industrial activity across Africa, with businesses and manufacturers in several countries relying on private generators and other backup sources to maintain operations.
The group already has experience in power generation through its industrial operations.
Dangote Industries generates electricity to support its major facilities, including its refinery and fertiliser complex in Nigeria.
Its Dangote refinery and fertiliser operations together generate more than 650 megawatts of electricity, according to recent comments by Devakumar Edwin, the group’s vice president for oil and gas and fertiliser.
The group has also been expanding its energy infrastructure as it increases production across its industrial businesses.
Dangote said the next phase of its investment strategy would place greater emphasis on power because of its role in supporting businesses and creating wider economic opportunities.
He said the focus was not only on generating electricity but also on ensuring that more Africans could participate in economic activity.
“Power is key to creating wealth,” Dangote said.
The group’s proposed investment comes as Dangote Industries continues to expand its operations across Africa, with projects in refining, fertiliser, petrochemicals and infrastructure.
Dangote said the broader strategy is aimed at increasing industrial activity and creating more opportunities across the continent.
