Nigeria closed all its land borders and halted all trade relations with its neighbors (Benin, Cameroon, Chad and Niger) in August 2019 without a timeline of reversal. The reason touted for this radical move by President Buhari was the need to curtail the smuggling of goods such as rice and textiles to boost domestic production. The government also claimed curbing the illegal supply of weapons into the country as one of the aims of the unilateral border closure. This came at a time when African countries are trying to remove border restrictions in accordance with the goals of African Continental Free Trade Agreement signed by all African countries except Eritrea. That decision, clearly ill-thought-out at the time has proven insufficient to meet its aims.

Due to a deficit of infrastructure, the subsequent increase in the domestic production of rice is not on a trajectory fast enough to feed the nation in the next few years. The effects of the border closure alongside other protectionist policies such as the 70% duty imposed on rice imports through the nation’s seaports in 2013 has put Nigeria in a very dire situation, particularly with food. In the last 5 years, between September 2015 and September 2020, food inflation rose by 108%.This, alongside the tensions in future trade relations facilitated by the lockdown which has had a staggering effect on Benin Republic’s economy is more than enough reason for such a bad policy to be repealed.

This is why the recent news of land borders being opened for exports should be good news. However, the fine details make it the opposite. On November 11, it came to public attention that Dangote Cement, a subsidiary of Dangote Holdings Ltd. and Bua Cement have been allowed to export goods by land. There have been speculations as to whether this is an indication that the borders will soon be opened for the continuation of trade. An assessment of Aliko Dangote, the principal beneficiary of this government largesse suggests that these speculations are pipe dreams.

Aliko Dangote, who comfortably sits in the top spot among the wealthiest Africans,is a man whose rise to stupendous affluence is a far cry from a rag to riches story. At the age of 21, he obtained a $3,000 loan from his uncle, Dantata to import and sell agricultural commodities in Nigeria. He was successful at this and was able to repay the entire loan within 3 months of starting operations. Since then, over the past three decades, Dangote has grown his business empire into a formidable conglomerate with interests encompassing many industries, including oil and gas, consumer goods, and manufacturing with about 80% of the conglomerate’s revenue coming from Dangote Cement. The Dangote Cement subsidiary produces 44 million metric tons of cement every year and operates in 10 African countries. Dangote also owns the world’s third-largest sugar refinery, and together, all his publicly traded companies make up a quarter of the market capitalization of the Nigerian Stock Exchange. In light of this, it comes as no surprise that he has a net worth of more than $10 billion.


Read more: https://thefederation.com.ng/2020/11/15/a-concrete-tomb-for-a-rigid-country-by-joshua-lawal/