Aliko Dangote, the Chairman of the Dangote Group, has revealed why Nigeria won’t see economic growth under President Bola Tinubu.
Speaking at the 2024 summit of the Manufacturers Association of Nigeria (MAN) in Abuja, Dangote said no economic growth will happen unless the current 30% bank interest rate is reduced.
Dangote, Africa’s richest man and prominent businessman, stated that the high interest rate is hindering economic growth.
He compared the situation to advanced economies like Europe and the U.S., where interest rate hikes were a response to inflation caused by massive cash transfer programs during the COVID-19 pandemic.
Dangote noted that African countries, including Nigeria, did not implement similar cash transfer programs, so they face different economic challenges.
He argued that the current high interest rates in Nigeria prevent job creation and economic growth.
“Mr. Vice President, I know that today we are battling with very high interest rates. This interest rate is now saying that we should fight inflation. I’m not an economist, I’m just a local businessman,” said Dangote.
He explained, “The other countries, why did they jack up interest rates during COVID-19? The G7 countries pumped money into their economies to the tune of 18.9 trillion. So in their economies, there was so much of money chasing few goods. This means that everything is going to go up.”
“During COVID, we didn’t do anything at all. The only thing we did was food palliative and I’m talking about Africa in general.
“As a result, African countries did not experience the same inflationary pressures stemming from excess liquidity, but they are now facing other economic challenges.”
Speaking about Nigeria’s current high interest rate, Dangote stated that it is responsible for economic stagnation.
“Right now, at 30%, there is no way anybody can create jobs because we are actually stifling growth. So interest rate can remain at 30% but no growth will happen unless that interest rate comes down,” he asserted.
“We must look to leading countries in the West and the East who are actively protecting their domestic industries.”
Dangote also criticized Nigeria’s dependence on imports, saying it hinders industrial growth and leads to poverty and job losses.
He said, “Import dependence is equivalent to importing poverty and exporting jobs. No power, no growth, no prosperity. Similarly, no affordable financing, no growth, no prosperity.
“There is no industrialization without protection. Ignoring these facts is what gives rise to insecurity, banditry, kidnapping and abject poverty.”
He called for better protection of local industries and highlighted the need for affordable financing to drive growth and prosperity.
Dangote pointed out that successful countries often protect and promote their local industries despite advocating for free trade.
He emphasized that strong local investment is crucial for attracting foreign direct investment, using examples from the West, China, and India.
Dangote stressed that Nigeria has the potential to develop a competitive manufacturing sector and called for a rethinking of the country’s industrialization policy, drawing lessons from leading Western and Eastern countries.
Lastly, he mentioned that the Central Bank of Nigeria (CBN) has raised interest rates from 18.75% to 26.25% over three consecutive Monetary Policy Committee (MPC) meetings, contributing to the current economic challenges.
KanyiDaily recalls that Aliko Dangote previously said the biggest mess created for businesses in 2023 was devaluation of Naira.
