WikiLeaks Exposed Secret of Dangote Wealth, The Cabal and Others

FROM TRADING TO MANUFACTURING — THE DANGOTE AND GON (Government Of Nigeria)
SHARED DREAM

Classified By: Consul General Brian Browne
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¶7. (C) Dangote’s shift toward manufacturing accords with the GON’s nationalistic economic policies, which place a premium on domestic manufacturing and production. What we don’t know is whether Dangote and others like him helped drive the policy or whether their actions were driven by the government policy. Reality is probably a mixture of both.

¶8. (C) In part, because of this shared dream, the Government has been very supportive of Dangote. We know the company at one time or another held exclusive import rights in sugar, cement, and rice using such advantages to do volume business and undercut competitors. In a December 1996 interview, Aliko Dangote admitted that a government mandate once forced him to import so much rice that the local market crashed by almost 80 percent. The direction of GON trade barriers also suggests preferential treatment. High tariffs or outright bans on imported items favor the Group in nearly all areas in which they do business including wheat flour, cement, certain textiles, sugar, and pasta.

¶9. (C) Further, the GON is normally slow in privatizing state-owned production facilities. Yet the Dangote Group swiftly won bids on GON-owned manufacturing installations such as the Benue Cement Company and the Savannah Sugar Company and constructed its own berth at GON-owned Apapa port in Lagos where ships with production inputs offload directly at the Dangote Group factory.

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Early and Easy Access to Political Favoritism
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¶10. (U) Dangote is revered for his assumed rise from rags to riches but his family connections reveal a privileged beginning. Dangote is from the prominent Dantata family of Kano State. The Dantata family made its name and wealth in commodity trading. When in his early twenties Dangote showed promise as a young businessperson, his uncle Sanusi Dantata loaned him naira 500,000 (at the time worth USD 500,000) to start out on his own.

¶11. (C) Because of their influence in the Hausa and Muslim communities, Dangote and Dantata have always been useful to both the civilian and military leaders who ruled Nigeria. Dangote enjoyed GON favoritism in the form of importing rights throughout the military regimes and coups of the 1980s and 90s. Though he has connections with political figures throughout the country, his link to Obasanjo (OBJ) paid off when OBJ was elected president in 1999. Since then, Dangote’s market advantages and growth have multiplied.

¶12. (C) Dangote purportedly contributed 200 million Naira (about $1.5 million at the time) to Obasanjo’s first election campaign and in 2003 at least another one billion Naira (about USD 7.5 million) for the second term. Dangote is a known contributor to the PDP party. He is a close friend with the governors of Kwara, Kogi, and Ogun states. He also enjoys support from the Sokoto Caliphate, the spiritual and political seat of the power of Muslims and members of the Hausa tribe.

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Nigeria’s Dangote Paradigm Stands in the Way of Economic
Liberalization and Democracy
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¶13. (C) The special relationship Dangote holds with the GON defines the Dangote paradigm. The paradigm demonstrates how easily one powerful person can disrupt Nigeria’s floundering democratic and economic liberalization processes. Along with outright money laundering and corruption, the Dangote paradigm is arguably one of the key factors making Nigeria a politically and economically volatile country and a risky place to do business.

¶14. (C) Dangote openly asserts the GON should do more to manage the economy through protectionist measures to assist what he calls the “Nigerian Industrial Renaissance.” He has no qualms about “alerting the government” or “giving direction” in industrial policymaking. Dangote and some members of the GON justify this protectionism with examples such as US corporate and railroad barons and the gilded era of the late 1800s.

This, they say, is the way to lay the foundation for economic growth, particularly in the manufacturing and industrial sectors. However, these alleged historic parallels do not mask the fact that the chummy relationship between Dangote and the GON, while superficially promoting manufacturing in some sectors, is causing destructive and derailing economic activity and democracy in other areas.

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Comment
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¶16. (C) Dangote’s tremendous popularity and acceptance is not likely to diminish. The average Nigerian considers him, and more importantly, his way of doing business, a model to be emulated. The fact is, however, the myriad preferences the GON has bestowed on the Dangote Group have distorted the market in ways that do more harm than good over the long haul. However, the Nigerian Government rarely takes a long-term perspective into account.

The GON-Dangote relationship has been, at minimal, very chummy and mutually accommodating. Critics of this relationship would state that it smacks of insider trading.  Dangote does not epitomize the free market at work in Nigeria. What his story reveals is that he is one of the few free-wheeling actors in a relatively and artificially closed economic environment.

To Be A Dangote

The undue and corrupt mutually beneficial advantage given by all Nigeria’s administrations, both military and civilian are the “secret” to Dangote’s success. Dangote kills Nigerians with economic terrorism. Fixing Nigeria starts with holding him and those who have impoverished the nation to his and their advantage to account. Since the 70′s Dangote has enjoyed sole importation and manufacture privileges that have killed and crippled all Nigeria’s indigenous industries including farming.

A blogger in 2003 expressed on the Nigeria Village Square:

“Aliko Dangote, at the age of 21 in 1977 was given virtually the same privileges he’s got today by the military government of you guess who, Obasanjo. Here was a boy, who knew nothing about business and with no formal education, purportedly understudying his uncle, Sanusi Dantata, given the exclusive right to import cement into the country on behalf of a government involved in a spate of capital projects in those days, made possible by petrodollar. Now, does it need the genius to note that anyone given such a privilege would become an instant billionaire?”

The partnership between Dangote and Obasanjo as “occult.”

Again The Cabal, Dangote, and a Nigerian we have analyzed to be the chief terror mastermind, Aliyu Gusau, ensured they returned Obasanjo to power in 1999 to satisfy their personal interests. Gusau believed Obasanjo will handover the country to him at the end of his tenures, as he illustrated in his constant whining to the US diplomats, and Dangote sponsored the bid with the assurance of usurping the entire wealth of the nation. See: Nigeria’s Terror: Between Die-to-rule spymaster Gusau and Beggar-thy-countrymen Dangote.

Of installing Obasanjo and later on, the Yar’Adua administration, WikiLeaks reported the US as describing:

Dangote and Transcorp Buys the Presidency – Cables

¶4.(S) Aliyu Mohammed, saying he was quoting Yar’Adua directly, said that Obasanjo had “ordered” the Katsina governor to contest for the Presidency. When Yar’Adua objected that the state of his health precluded it, Obasanjo countered that “God will cure you,” and undertook to cover all medical expenses. When Yar’Adua said he had no money, Obasanjo organized financial angels, all associated with Transcorp and led by Northern millionaire Alhaji Aliko Dangote.

This group is supplying the Yar’Adua campaign with 45 jeeps (of which four are armored), a war chest of 5 billion Naira, and a rented jet. (Aliyu Mohammed said that Dangote and the other “Transcorp boys” seek a Yar’Adua presidency to facilitate their gaining control over most of Nigeria’s oil and gas production.)

Andy Uba, recently selected as PDP gubernatorial candidate for Anambra state, has been a “special assistant” to President Obasanjo; he has no independent power base of his own and is widely disliked because of his arrogance. Aliyu Mohammed went on to say that the President had ordered the arrest of the chief of staff to Rivers State Governor Peter Odili to warn the latter away from seeking the vice-presidential nomination himself. 7 years! The Ridiculous Cement Concessions By Obasanjo And the Resulting Exploitation of Nigerians

7 years is a Biblical term during which debts can be expunged, it is also the time limit for yet to be convicted crimes to be expunged in the US. 7 years is time enough to make or destroy a man or a nation. It is this length of time that the Obasanjo presidency gave Dangote to destroy all other cement companies in Nigeria and establish himself as Nigeria’s sole cement manufacturer.

The Guardian on 4/24/03 writes :

Dangote gets concessions for cement production

From Madu Onuorah, Abuja
THE Federal Government yesterday rolled out several incentives to an indigenous conglomerate, the Dangote Group, in its efforts to encourage Nigerians to invest locally. The business concession is to enable the company to actualise an $850 million project involving the establishment of cement production plants in three locations in Nigeria.

Minister of Transport, Chief Ojo Maduekwe, announced after the Federal Executive Council (FEC) meeting in Abuja, yesterday that the incentives included the granting of pioneer status to the company in the area of cement production for seven years.

This means that within the period, no new cement plant will be established in the country. Other incentives include the granting of 2.5 percent duty on all plants, machinery and quarry equipment, exemption from payment of the Value Added Tax (VAT) on all plant, machinery and quarry equipment, and the payment of only five percent duty on construction materials not available within the country.

In its request to the council for establishment of the plants in Ogun, Kogi and Cross River states, the Dangote Group requested from the Federal Government the following investment palliatives;

pioneer status for 10 years; exemption of payment of duties on all plant, machinery and quarry equipment;

exemption of payment of VAT on all plant, machinery and quarry equipment; exemption of payment of duties on construction materials not locally available; massive road construction at sites of the plant by the Federal Government, and; permission to import five million metric tonnes of bulk cement at a maximum rate of five percent duties.

The three plants located in Ibesha, Obagana, and Odukpani, are expected to produce 4.3 million metric tonnes of cement yearly by the year 2005.

Maduekwe explained, “we are doing this to serve notice that this government is willing to support companies which are willing to vote (for the country) with their checkbooks. They need to put their money in their country. This is a government that is encouraging the business class. We are ready to do it for other companies as we did to Dangote”.

Other decisions of the council include the approval of a new energy policy for Nigeria and approval of a contract for the provision of 2,000 telephone lines and 240 digital telephones to Gboko, Benue State. The contract is worth N130.6 million.

The result of this undue and criminal advantage was Dangote who had by then first bought cement companies in neighboring African countries, imported bulk cement into Nigeria with his 5% maximum duties, and sold this cement at ridiculous prices to crumble and destroy all his competition. The government of Obasanjo also ensured he and he alone bought all available cement plants.

Kenn commented in 2003:

Did you know that Iyiorcha Ayu lost his job as Minister of Industries for insisting that a more competent and qualified bidder takes over Benue Cement?

I’m sure you’re aware that Dangote is the spirit behind the so-called “Corporate Nigeria” raising billions of naira for Obasanjo’s re-election. I’m sure you’re also aware that he was “the young Kano businessman” that parachuted the intimidating tonnes of Ghana-Must-Go into the PDP convention ground.

He’s also rumoured to have backed all the PDP governorship aspirants in the South-West, including Bukola Saraki in Kwara. This is quite apart from the claim that he’s the linchpin of Babangida’s 2007 project – his specific brief being to create and facilitate support in the South-West for the Evil Genius.

And, isn’t it conveniently coincidental that he’s getting this immediately after the Presidential elections? And, by the way, how does “permission to import five million metric tonnes of bulk cement at a maximum rate of five percent duties” (note that no one is taking minimum) help in the indigenous production of cement, even as we all know that the raw material abounds in our country?

There’s nothing wrong with national governments supporting indigenous private enterprise in order to improve competitive advantage, but check all the relevant and successful examples, from South Korea to Japan or China and one thing you see is that they’re usually directed at a group/industry; it’s never done for the benefit of a single individual.

What is being done with Dangote in the name of promoting indigenous business is simply crass favoritism. To put it bluntly, he’s a front for those who’re using their political power to provide him these privileges. It is criminal, to say the least.

Dangote Repays Nigeria For Our Generosity By Then Selling At Triple The Global Price

The most important problem with all this is the result. If Dangote was appreciative and fearful enough of the sacrifice Nigeria, Nigerian businesses, and the Nigerian government had given him, he would sell his cement, now that he has established himself as the top producer, at costs that are considerate. Not, Aliku Beggar-they-countrymen

Dangote. Dangote rather ensured that he, supplying up to 90% of Nigeria’s cement, forced the price per bag up to N2900, about $17/bag. This is over three times the global average for the product.

Unfortunately, death stopped Yar’Adua. Hopefully, he wasn’t poisoned.

One must commend the Jonathan administration for being able to force a tiny reduction in sale price on the assumption of power in respect to this ungratefulness and criminal exploitation and profiteering on the backs of the Nigerian masses. Jonathan forced the cement manufacturers to reduce the cost.

Cement now sells in Nigeria for N1650-1800/bag. That is about $10-11/bag. Our article, Paying Double The World Price: Dangote Cements Nigerians In Poverty details how this is still twice the global average for the same size product.

A writer online reacted to this, proposing that the fact that the Dangote company declares “outrageous” profits indicated the exorbitant sale price of his cement was not related to the cost of production, which includes electricity generation, but set out of sheer wickedness and greed. Ibeto Cement confirms that cement should sell for N800 a bag at the most with all production costs and government advantages given to Dangote considered.

The Jonathan administration continues the Dangote favoritism, continuing to destroy all other cement competitors, to ensure Dangote maintains his exploitative monopoly. According to the Punch,

“Sometime in June 2012, Ibeto Cement had to seek a legal option to retain its import license when the FG tried to stop it. The latter’s action was said to be based on advice allegedly offered by local manufacturers (Guess who?). Reacting to this trend, the chairman of New Entrants into Cement Production, Mr. David Iweta, says there is a need for the local manufacturers to review their prices downwards since there are many variables that work in their favour, which the importers of the commodity do not enjoy….”

Iweta sees no reason why a bag of 50kg bag of cement should be sold above N800, since local manufacturers are using limestones, which are sourced locally, as raw materials. Besides, he notes that labour is available and cheap. He says, “I believe it is exploitation for Nigerians to pay above N800 for a 50kg bag of cement as retail price. Let them reduce it to N700 and see how the commodity will disappear from the market.”

Also, Iweta does not see the wisdom in selling imported and locally produced cement at the same price. According to him, an importer pays $100 on cost and freight per metric tonne of cement. He says the locally produced cement should be cheaper than the imported variety because the latter attracts duty and 35 percent levy, which is another $35 per tonne.

“The local manufacturers do not pay these levies. So, their prices should be cheaper. Imported cement sells within the same price range as the locally-produced ones. This should not be,” Iweta stresses. Read full on Punch

The Same Plan Again With Tokunbo Cars

FIGHT-THE-CABALNigeria’s government again decided to punish the masses by creating similar advantages and frustrations for its people while favoring the cabal. The plan to ban the importation of Tokunbo cars was eagerly announced after the Minister of Industry who is eager to stamp his name on the sands of time; after many meetings with the cabal and car manufacturers, planned to once again frustrate all car dealers, a 320,000 Nigerians employing industry, out of business, in favor of the hand full of the cabal who intend to usurp this industry and extort the masses.

NewsRescue sources have described unbelievable lobbying that has been going on in Nigeria ahead of this announcement of a proposed ban. The plan that has been on the table with dealers like Coscharis Group Motors, Elizade motors and others who have been lobbying strongly, is for them to work with foreign car companies and bring them to assemble and manufacture in Nigeria.

However as is with the Nigerian system as exemplified by the Dangote cement model, the cabal will manufacture and sell these cars of select choices and forced on Nigerians for whatever price they wish. And the people will first be punished to support the cabal company stock and assure them of government favor, before any cars are even produced.

Dangote Is The Cabal Archetype Behind Nigeria’s Suffering, Bad Government, Corruption and Poverty

Dying Yar’Adua tried to no avail to beg the evil Don Dangote to cut prices of cement down to N1000 per bag to allow growth. Dangote blackmailed Yar’Adua according to this report:

Back-off Cement or face the Consequences, Dangote tells Yar’Adua

A fresh offensive to bring down the price of cement has already hit a snag as the powerful cement cartel led by billionaire business magnate, Alhaji Aliko Dangote is digging trenches ahead of what promises to be an imminent showdown with President Umaru Musa Yar’Adua over a planned move to grant more cement import licenses to importers outside the main industry cartel.

Sources at the Presidency told Huhuonline.com that whereas President Yar’adua wants to force down the price of cement to at least N1000 per bag, Dangote remains hell-bent on keeping the price at its current average level of N2000 per bag, in order to continue reaping the astronomical profits he has been earning because of his oligopolistic status within the sector.

“If the government grants licenses to people to import cement, we’ll close down our factories and lay-off workers; and when that happens, the domestic production capacity will reduce drastically; supply will still not match demand and the prices will even sky-rocket further. My advice is that the president should back-off the cement industry or face the consequences”, Dangote was quoted as warning Yar’adua by an industry source who elected anonymity…..

“It is amazing how a shriveled conscience like Dangote can be allowed to inflict so much pain on other Nigerians,” the source told Huhuonline.com, adding:

“President Yar’Adua is greatly concerned that the cement cartel is frustrating his efforts to enable more Nigerians own houses by keeping the price of cement above the reach of many citizens. He has therefore begun a process of dismantling the cartel as he did in the downstream sector of the oil industry to curb the excesses of fuel marketers and nothing; not even Dangote will stop the President.”Hulu; 7 July 200.

One must commend the Jonathan administration for being able to force a tiny reduction in sale price on the assumption of power in respect to this ungratefulness and criminal exploitation and profiteering on the backs of the Nigerian masses. Jonathan forced the cement manufacturers to reduce the cost.

Cement now sells in Nigeria for N1650-1800/bag. That is about $10-11/bag. Our article, Paying Double The World Price: Dangote Cements Nigerians In Poverty details how this is still twice the global average for the same size product. A writer online reacted to this, proposing that the fact that the Dangote company declares “outrageous” profits indicated the exorbitant sale price of his cement was not related to the cost of production, which includes electricity generation, but set out of sheer wickedness and greed.

Ibeto Cement confirms that cement should sell for N800 a bag at the most with all production costs and government advantages given to Dangote considered.

The Jonathan administration continues the Dangote favoritism, continuing to destroy all other cement competitors, to ensure Dangote maintains his exploitative monopoly. According to the Punch,

“Sometime in June 2012, Ibeto Cement had to seek a legal option to retain its import license when the FG tried to stop it. The latter’s action was said to be based on advice allegedly offered by local manufacturers (Guess who?). Reacting to this trend, the chairman of New Entrants into Cement Production, Mr. David Iweta, says there is a need for the local manufacturers to review their prices downwards since there are many variables that work in their favour, which the importers of the commodity do not enjoy….”

Iweta sees no reason why a bag of 50kg bag of cement should be sold above N800, since local manufacturers are using limestones, which are sourced locally, as raw materials. Besides, he notes that labour is available and cheap. He says, “I believe it is exploitation for Nigerians to pay above N800 for a 50kg bag of cement as retail price. Let them reduce it to N700 and see how the commodity will disappear from the market.”

Also, Iweta does not see the wisdom in selling imported and locally produced cement at the same price. According to him, an importer pays $100 on cost and freight per metric tonne of cement. He says the locally produced cement should be cheaper than the imported variety because the latter attracts duty and 35 percent levy, which is another $35 per tonne.

“The local manufacturers do not pay these levies. So, their prices should be cheaper. Imported cement sells within the same price range as the locally-produced ones. This should not be,” Iweta stresses. Read full on Punch

The Same Plan Again With Tokunbo Cars

FIGHT-THE-CABAL

Nigeria’s government again decided to punish the masses by creating similar advantages and frustrations for its people while favoring the cabal.

The plan to ban the importation of Tokunbo cars was eagerly announced after the Minister of Industry who is eager to stamp his name on the sands of time; after many meetings with the cabal and car manufacturers, planned to once again frustrate all car dealers, a 320,000 Nigerians employing industry, out of business, in favor of the hand full of the cabal who intend to usurp this industry and extort the masses.

NewsRescue sources have described unbelievable lobbying that has been going on in Nigeria ahead of this announcement of a proposed ban. The plan that has been on the table with dealers like Coscharis Group Motors, Elizade motors and others who have been lobbying strongly, is for them to work with foreign car companies and bring them to assemble and manufacture in Nigeria.

However as is with the Nigerian system as exemplified by the Dangote cement model, this cabal will manufacture and sell these cars of select choices and forced on Nigerians for whatever price they wish. And the people will first be punished to support the cabal company stock and assure them of government favor, before any cars are even produced.

Dangote Is The Cabal Archetype Behind Nigeria’s Suffering, Bad Government, Corruption and Poverty

This man, who has risen to global wealth status epitomizes Nigeria’s biggest problems. He is the head of the cabal behind Nigeria’s biggest political party, the PDP. He chooses and sponsors the presidential candidates who can help him totally exploit the nation. As the cable report stated, his aim is to take over control of all Nigeria’s oil, gas, and other resources.

With his government favoritism, he collapses all competition and small businesses in Nigeria and establishes himself as the sole importer or manufacturer.

One wonders if when Nigeria begins its touted exportation, Dangote will sell his $hit abroad for $13.00, that’s the $11 he sells it to Nigerians plus export costs. He’ll probably export it for $2/bag!

Nigerians are grateful that he employs them (slaves) to labor in his companies, they fail to realize that he can not employ animals or use machines to work his industries that make the product he uses in Nigerian markets to rip them off of their future. See: SaharaReporters-No To Slave Labour At Dangote’s Savannah Sugar Company

A few challenge him to make his money and take his products to compete in normal markets and countries.

We earlier wrote that it can be predicted that when Dangote’s refinery is operational, Nigerians will pay double the price for petroleum products. The removal of the government oil subsidy in January 2012, is very much related to the preparation of the pathway to the Dangote refinery.

This removal by Jonathan helped boost the worth of Dangote’s refinery stock and helps him get loans to invest in the project. It is the same Obasanjo method of crippling the government’s ability and crippling the masses to make Dangote. Related: AP Shareholders To Petition London Stock Exchange over Dangote

Nigerians are also happy with his pennies in charity which help him get tax breaks as is done by all other big companies. Nigerian breweries for instance sponsors shows all over Nigeria all year round, not because they love to party, but as donations to reduce their levied tax.

SaharaReporters: Aliko Dangote Is A Criminal

What he passes as entrepreneurial practices is brigandage and piracy personified. A few years ago, when someone I know attempted to import corned beef into Nigeria from Botswana for distribution, he couldn’t on the grounds that it was on the prohibited list. When I nosed around, I ascertained that this same criminal, Aliko Dangote imports into Nigeria and distributes all manner of corned beef from Argentina, Brazil, and Australia.

His shenanigan over cement stinks to high heavens. … after I discerned that every iota of cement that comes into Nigeria was through Aliko Dangote. …that the decision made in high quarters is that every cement importation must be left in the hands of manufacturers. Who else constitutes cement manufacturers in Nigeria? Aliko Dangote, the criminal.

The closer investigation that I conducted clearly revealed that this Aliko Dangote has exclusive access, use and control of the Onne wharf in Port Harcourt… that anyone, be the one from the customs, or any other state establishment that tries to venture close to that wharf will receive the lashing of his or her life from the goons that man the place for Aliko Dangote. It’s right through Onne that he imports and exports whatever he wants. Read full

The current biggest enemy and obstacle to Nigeria’s development and democracy is the cabal, and the one man at the head of this small group is Dangote who is successfully turning Nigerians into beggars, as the US regards it.

It is commonly said in Dangote’s Kano, with its 1.5 million Almajiri (beggars) that “dog is more loved in Kano than Dangote.”

Summarizing, a US Wikileaks cable put it thus:

¶1. (C) Summary. Alhaji Aliko Dangote (Dangote) is Nigeria’s most well-known businessperson and maybe its wealthiest citizen. He has taken on the aura of an economic folk hero for some, villain for others. To supporters, he symbolizes that Nigeria can do more than barter and trade. It can succeed in manufacturing. To detractors, he is a predator using connections in a corrupt political economy to tilt the playing field in his favor and sideline potential competition.

The truth resides somewhere between these caricatures. Dangote is counted among President Obasanjo’s inner circle of business advisors. It is no coincidence that many products on Nigeria’s import ban lists are items in which Dangote has major interests.

¶2. (C) Summary Cont’d: Although an undiluted success in terms of wealth accumulation, Dangote personifies the duality in Nigeria’s economy. This duality presents a dilemma for US economic policy. On one hand, Dangote imports significant amounts of US produce and equipment for his manufacturing ventures. On the other, he has had success in blocking trade and investment that might compete with his enterprises.

Weighing everything in the balance, we believe the Dangote model is harmful to Nigerian and American interests in the long run. Unfortunately, the Dangote model will likely be the one most emulated until its beggar-thy-countrymen
contradictions become more apparent. End summary.

Nigeria, Where Crime Is Revered: Jonathan Gave GCON To Nigeria’s Top Cabal Crook

To add insult to the injury Nigerian’s bear from this dangerous grand crook, on 14th November 2011, President Goodluck Jonathan awarded his sponsor and puppet master, Dangote the Grand Commander of the Order of the Niger (GCON), the nation’s second-highest award, previously the exclusive preserve of Vice Presidents, Senate Presidents and Chief Justices of Nigeria.

GCON: Nigeria where crime is rewarded

The more Nigerians boycott Dangote goods, the better their hope of forcing changes for their survival. Ultimately only a revolution or a decent government he is not in bed with can bring him to book. Right now, he owns and controls president Jonathan like his puppy.