The Sunday Mail
Africa Moyo
THE Dangote Group is actively pursuing its planned investment in Zimbabwe with high-powered teams of technocrats from the company shuttling between Harare and Lagos, Nigeria processing the paperwork necessary to pour over US$1,2 billion into various sectors of the local economy.
Africa’s richest man, Mr Aliko Dangote, visited Zimbabwe on August 31 this year to kick-start the mega investment projects.
Mr Dangote’s net worth is estimated at US$17,2 billion by Forbes magazine, and he has expressed interest in setting-up a 1,5 million tonne per annum cement facility, a coal mine and a power plant here.
The projects are valued at US$1,2 billion; with US$500 million being poured into cement making, US$400 million for electricity generation, and US$300 million targeted for coal mining.
The Nigerian billionaire’s company has interests in manufacturing and power generation.
A source at the Zimbabwe Investment Authority told The Sunday Mail Business that the deals were on, and officials from the two countries were actively engaging to address finer details.
ZIA has already issued the requisite permits for the Dangote Group to start work and the company is understood to be seized with preliminary activities such as geological surveys.
ZIA chief executive officer Mr Richard Mbaiwa said, “As far as we are concerned … after Dangote came here, a follow-up team came and we had meetings with them where they were expressing their interest to invest.
“They then submitted paperwork, they registered their company and we gave them an investment licence so we are waiting for them to start once they finish whatever technical surveys they are doing.
“The last meeting I had, was with the chief strategist Mr Abdul Muhta and the team he brought early October. I think they have had two trips to deal with issues of their paperwork.
“… they have not expressed any contrary view to us than what they expressed when they first came to see us,” said Mr Mbaiwa.
Sources close to the deals say the Dangote Group has been sending technical experts, including geologists, looking at deposits for limestone.
“You will be aware that their main business is cement so they would want to look for areas with good limestone deposits which are also suitable for what they want to do,” said the source.
“There is a lot of preliminary work that has to be done before they start work on the ground. When these guys came here, they said first half of 2016, if everything is set, they can be starting (operations).
“So we can try and rush to see progress but in my view, we cannot expect them to start now because that is a big project which requires a lot of studies before it is implemented.”
Observers and senior Government officials point out that deals of such magnitude take time to implement as careful analysis of the business environment is crucial before money exchanges hands.
A source said the Nigerians had engaged local law firm Dube, Manikai and Hwacha to look into legal aspects of the investments.
Efforts to get more information from the law company were unsuccessful and an official with the lawyers who identified herself as Ms Chipo Sachikonye said: “I have no instructions to give that information (on the Dangote deals.”
Expectations are that when Mr Dangote’s investments take off in Zimbabwe, the cost of construction will be dramatically reduced, which will also have an effect on property prices.
Ebenezer Properties founder Mrs Rumbidzai Dihwa said: “We, therefore, expect developers to construct properties that are affordable going forward but to talk about a decline in the prices of existing properties maybe tricky.”
Dangote Cement has been on a major expansion programme in Africa with billion dollar investments in Zambia and Cameroon this year alone.
In Zambia, the group commissioned a US$420 million cement manufacturing plant and a 30MW coal-fired plant and a US$250 million 1,5 million metric tonnes per annum cement grinding plant in Douala, Cameroon.
The Zambia investment saw cement prices in that country almost halving, and further declines are anticipated.
Dangote Cement has expanded capacity five-fold in the last four years and aims to double potential output to 80 million tonnes by year-end.
