Dangote And A War Foretold – By Dare Babarinsa
*Photo: Alhaji Aliko Dangote*
It would be good if we all realise the truth that nobody is going to build our country for us. As of now, the country needs to be built, brick and mortar, little by little. It is a good sign that President Bola Ahmed Tinubu has set up an Economic Team that looks quite formidable.
No longer would the crucial business of the economy, the most important aspect of building our country, be left only in the hands of politicians. Looking at the team makes one to have the confidence that the government is serious about its self-imposed assignment of making tomorrow better than yesterday.
The new team includes such giant private-sector players like Aliko Dangote, Tony Elumelu, Amina Maina, Funke Okpeke, Segun Agbaje and Rasheed Sarumi.
The effect has started showing. In Nigeria, whatever goes up does not come down, except you-know-what. But the naira exchange rate to the dollar and other international currencies is going down. We also hope that the price of petroleum and allied products would also stabilise. That is the opportunity and promise that Dangote Refineries, Lagos, has offered our country. In the months ahead, we would be able to grasp the full implication of Nigeria having the largest and most modern petroleum complex in the world.
The Dangote Refinery is sitting on 180 acres of land at the Lekki Free Trade Zone in Lagos State. It is going to be producing diesel, aviation fuel, petrol and other petroleum products. It has the capacity to process about 650,000 barrels of oil per day. When fully operational, it is expected to provide direct and indirect employment to 135,000 people in Lagos State. The refinery has cost almost 20 billion American dollars.
Already, even before the refineries start firing in all cylinders, its competitors in Europe and other theatres are jittery. Several refineries in Europe, which for some decades have been exporting petroleum products to Nigeria, are going to face a hard time. First, the Nigerian market would no longer be available for them. Second, Dangote petroleum products may also be ready to give them a good fight in the European market.
This would be the first time an African company would directly threaten European companies in the theatre of Europe. There is no doubt that the months ahead would be very interesting.
However, it is not yet time for chest-beating for Nigeria. The old establishment is quite influential in the power loop of Nigeria and may pull one or two stings to make things happen here.
The Dangote Group is already feeling the heat where it hurts most. For many weeks it could not buy crude oil to refine. Without crude oil, the refinery is not more than a tourist attraction. To start its operation, the Dangote refinery had been on queue with other competitors to get crude from the Nigerian National Petroleum Company plc. The NNPC has the monopoly to sell Nigeria’s crude. To get a share of the market, you have to be in the good book of the power-that-be. That is a delicate dance which the Dangote Group is learning in a hurry.
Of course, economic independence, which is more difficult and protracted than political independence, is not going to come on a platter of gold. In a recent newspaper interview, Professor Ehiedu Iweriebor of the Department of Africana and Puerto Rican/Latino Studies, Hunter College of The City University of New York, defines Dangote Refinery and its related projects as the “Freedom Projects,” because of its expected impact on the Nigerian economy. “The plant would reduce Nigeria’s import dependency, its vulnerability to external pressure and also empower the country to begin to generate its own prosperity through the production and export of value-added goods rather than raw materials export,” says Iweriebor. “It means that Dangote refinery can supply refined oil to Nigeria and to parts of Africa. It will detach these regions from the dependency on Western suppliers for expensive and critical fuel supply.”
What should we expect from those whose refineries are going to shut down while the Dangote Refinery is revving into life? It would be naïve for us to expect them to do nothing. Oil is the life of the industrial societies of Europe and the Americas. In the aftermath of the 1973 Arab-Israeli War, the Arab oil producing countries started the oil embargo against the West which gave birth to the Organisation of Petroleum Exporting Countries.
The United States and its allies threatened to take military action if the stalemate was not resolve. In the end, many Arab countries had to back down. Today, the United States has a very large military base in Saudi Arabia, the home of Islam, and many other countries in the Middle-East.
In the wake of the Israeli-Hamas conflict, there are thousands of American troops and sailors sent to the Middle-East.
Economic consideration has been a proper pretence for war. Saddam Hussein, the dictator of Iraq believed that the tiny kingdom of Kuwait was sabotaging his country’s interest by refusing to cooperate with Iraq at OPEC meetings on the issue of oil production quota. He also accused Kuwait of slant drilling that allowed Kuwaiti oil drilling to have access to Iraqi oil.
Then he decided to invade Kuwait and the job was accomplished within 72 hours. The Western world could not imagine Saddam to be in charge of the oil fields of Iraq and Kuwait at the same time.
The result was the ultimatum issued to Saddam: withdraw or face war. In 1990, Saddam faced war instead and the consequences are still with us till today. By the time of the second Iraq War in 2003, Saddam was driven out of his luxurious presidential palace and was made to have a date with the hangman.
Nigeria had faced the same kind of crisis with international oil politics. On the eve of the Nigerian Civil War, the Western World was in a dilemma about which side to support. Most of the active oil fields were in the newly proclaimed Republic of Biafra under the leadership of Colonel Chukwuemeka Odumegwu-Ojukwu.
The Federal Government, under the leadership of General Yakubu Gowon, was in charge of a larger territory, mostly without oil. Gowon realised that crucial to the war efforts was the control of the oil fields. One night, Colonel Benjamin Adekunle led a flotilla of naval ships that took his troops to the rebel held island of Bonny.
Thy arrived there around 5 a.m. and took the Biafran troops by surprise. After a firefight of more than one hour, Adekunle landed on Bonny, captured the oil fields and changed the tide of the war. The victorious troops formed the core of the new Third Marine Commando Division and its leader took the sobriquet, the Black Scorpion.
This time around in 2024, firefight would not solve the problem. The challenge of a Nigerian company sending European firms out of the market in Africa and Europe is not going to be taken with folded arms. The Tinubu Economic Team needs to draw up contingency plans for this eventuality. We have seen what is happening on the international air routes with the new muscles of Air Peace, the largest and most capable Nigerian Air Carrier. Suddenly, the foreign airlines who have resulted into a price-war, struggling to disrupt the emerging leadership of Air peace on the international routes.
The dogfight in the sky promises to be interesting and messy.
The lesson is that we are capable of building our country. It is wrong for us to expect others to help us do the job even when we wrongly believe we can pay.
The Soviet Union under Josef Stalin, helped Mao Zedong to power in the Chinese Civil War which ended with the victory of the communists on October 1, 1949. However, when the relationship between China and the USSR deteriorated, Soviet engineers removed the rail-tracks they had already laid across China in order to disrupt the Chinese economic programme.
China responded with the campaign for self-reliance and built its own rail system, its cars, its air-craft and its aircraft carrier.
Chinese built China. Let us build ours.
