African Development Bank (AfDB) President Akinwumi Adesina has urged critics of Aliko Dangote, who accuse him of seeking to monopolise Nigeria’s oil industry, to construct their own refineries locally instead of importing petrol and diesel.
Federal regulators have recently alleged that Dangote is attempting to dominate the energy sector.
According to PUNCH, Adesina countered these claims by stating that Dangote’s request for federal support and protection for his $19 billion investment in Nigeria is not an act of monopolisation.
Instead, he argued that those aiming to compete should invest in setting up their refineries within the country.
This, he asserted, would not only ensure fairness but also stimulate local production and enhance the economy.
Adesina pointed out that monopolies typically emerge in sectors characterised by high entry barriers or substantial capital requirements, using railways and large-scale refineries as examples.
He contended that the substantial investment needed to build and operate such refineries inherently limits competition, which is why support and protection from the government are crucial for such significant investments.
The AfDB President also elaborated on the broader challenges facing Nigeria’s manufacturing sector. He described the business environment as challenging, with frequent policy changes and uncertainties that can deter investment.
According to Adesina, these hurdles make it difficult for new entrants to succeed, thereby contributing to the formation of monopolies.
Adesina said, “Competition is good for everyone. But are Dangote refineries anti-competitive? What is the evidence? Has Dangote Refineries prevented any other company from setting up refineries?
“Why have others not done so? How come they have not done so for several decades?
“Was it Dangote that held them back? But Dangote refineries surely cannot be asked to ‘compete’ with importers of petroleum products. That is not competition.
“Let the importers set up local refineries and compete by refining in Nigeria. That is fair and justified competition.”….Seē _ Morē