Business
Getting Rich the Hard Way
Not content with tomatoes, Dangote is also tackling Nigeria’s number one commodity, oil. His company is building an oil refinery with a capacity of 400,000 barrels per day and a polypropylene plant that can produce 600,000 tons per day. With the project cost totaling $9 billion, it is a weighty bet against free-market theorists who insist Nigeria’s comparative advantage remains as a commodity exporter rather than as an industrial powerhouse.
The real money is in manufacturing goods. Clustered around the heavy roller at the Mediterranean Industrial Group (MIG), engineers shout to make themselves heard. Machines bend a nearly two-inch thick sheet of steel relentlessly into a neat hoop. A shower of sparks engulfs the welding team. Slowly and surely, the mast that will eventually carry a wind turbine emerges from the work yard.
From their base in Sfax, the long-neglected industrial city at the gateway of Tunisia’s greater southern region, MIG represents a manufacturing success story, building metal structures such as telecom masts and energy sector infrastructure.
Bassem Loukil, CEO of Groupe Loukil, which owns MIG, appreciates the 10- 15 years of breathing space the government gave to infant industries in Tunisia. “Imagine trying to set up a unit like this today without protection, with all the Turkish and Chinese dumping strategies you have in Africa today! We would not have survived.”
More than 3,000km to the south in Nnewi, Nigeria, another workshop hums with life – grimy and less automated, it is a car factory owned by Innocent Chukwuma. “Yes, the government is helping me. The current tariff on imported cars is 10%, but this is going up to 35% in February,” says Chukwuma.
There is a culture of building in Nnewi that stretches back many decades. A cluster of small workshops dot the town. Chukwuma’s company, Innoson, is an echo of Loukil’s and indeed Dangote’s. All of them started off as traders and importers who went into manufacturing.
All had foreign partners at a critical moment of their development. All are trying to climb their way up the technology tree to gain a competitive advantage. “At the moment, we import the engine blocks from a specific factory in China, but we have ordered a die-casting machine which we should be getting at the end of the year,” says Chukwuma.
