Is Dangote Afraid of Competition

By Livingrich Ezeikpe (Abia writers)
Edited by Livingrich Ezeikpe
22nd June 2018

Obasanjo's civil administration can be remembered for its encouragement of local production of cement. Following the encouragement of locally made or bagged cement, the Ibeto cement factory promised to flood Nigerian market with cement and practically did, an action that drastically reduced the price of the product throughout Nigeria. The result was that the price of cement came down to the purchasing level of the poor in the land. The cheap prices of cement courtesy of IBETO was not received well by Dangote, who felt that Ibetos' kind heart towards the less privileged in the country jolted his own cement and affected his business adversely.

Consequently, Aliko Dangote petitioned the then President of the country, Olusegun Obasanjo challenging the authority awarded by the federal government to Ibeto to import 800,000 metric tons of cement. Whereupon, Obasanjo issued a directive that Ibeto was not allowed to import cement into the country until it proved its investment in local production, but Dangote was allowed to import cement into the country even without proving his production locally. That move by Dangote and the corresponding response by Obasanjo forced thousands of staff of lbeto cement out of job.

When the late Umaru Yar’ Adua succeeded Obasanjo, in 2007, Ibeto applied for import allocation and it was granted. Once again, he flooded the country with quality cement, and at an affordable price as well which again brought down the prices of the product to the purchasing level of the poor people in the country. Dangote again quickly filed a suit alleging that Ibeto Cement Company was gaining undue advantage of the Federal Government.

The Federal Government at the time contended that Dangote Cement PLC was plotting to wipe out fair business competition and a subsequent desire to monopolize the industry and transform itself to be the only cock that crows in Nigeria. The position of the government at that time appeared to have given Ibeto further strength to file terms of settlement, which were entered as a consent judgment in the suit.

By the consent judgment, Ibeto was to continue to import 1.5million metric tons of cement per annum for the period between 1st October 2007 and 30 September 2017. This was in line with the Federal Government

 

guarantee letter conveyed by the Ministry of Trade and Industry dated 5 June 2002. More by the judgment, the Federal Government was to pay Ibeto Cement Company the sum of $40 million and N1,885,813,592(N1.9billion). The amount is the verified claims by the inter-ministerial committee of the federal government for losses suffered by Ibeto from the unjustified closure of its bagging plant between December 2005 and when it resumed operations in October 2007.

But Dangote Cement PLC lamented that its rights and interests were affected by the consent judgment. He argued that the continuance of lbeto cement would reduce peoples' interest in his own cement, as they will see his as an expensive product.

However, the Federal Government and six of its agencies, which were the other defendants in their counter-affidavit deposed to by one Emmanuel Joel, an Assistant Litigation Officer in the law firm of Kenna Partners, argued that Dangote Cement PLC filed the suit with only one intention to wipe out competition in cement business and become a monopoly.

The Federal Government also contended that Dangote cement has no locus standi in filing the suit, as the matter did not concern them. It averred that the suit instituted by Dangote Cement against the Federal Government was fraudulent. It further argued that Dangote Cement was not a nominee or agent of government agencies, which were defendants in the suit, and was not acting on their behalf. It argued that Dangote Cement Plc is not an agency of Federal Government with the statutory mandate of administering, managing or enforcing tax compliance, therefore lacking the locus standi to commence or maintain the legal action and seek the reliefs in the case.

The Federal Government also contended that Dangote cement has no locus standi in filing the suit, as the matter did not concern them. It averred that the suit instituted by Dangote Cement against the Federal Government was fraudulent. It further argued that Dangote Cement was not a nominee or agent of government agencies, which were defendants in the suit, and was not acting on their behalf. It argued that Dangote Cement Plc is not an agency of Federal Government with the statutory mandate of administering, managing or enforcing tax compliance, therefore lacking the locus standi to commence or maintain the legal action and seek the reliefs in the case.

 

Amidst the battle against IBETO, he took cement production and purchases to another level. It signed a contract agreement of $368million with a Chinese company, namely, Zhejiang Sinoma Engineering Design & Research Institute Co., Ltd to produce 6,000 metric tons of Cement in Enugu State. The contract covered crushing limestone, mining, cement raw materials, packaging, shipped to the whole process and a 45MW capacity power plant, covering engineering design, equipment, steel and material supply, civil works, installation, commissioning, personnel training, et cetera. Fortunately, Ibeto Company already operated a similar facility in Port Harcourt, producing 6000 tons of cement. All these frightened Dangote into believing that IBETO's great moves were going to affect his dominance and that his monopoly of cement production will eventually be destroyed.

But Ibeto does not think in line with Dangote, to monopolize business in Nigeria or anywhere. Ibeto's concern as series of achieves about him show has been to make living affordable for the rich as well as the poor in the society. It has never been about himself. Already he is not just a hard working individual, he is a billionaire and one of the wealthiest men in Africa. As at 2013, he was estimated to worth about $3.7 billion dollars by Ventures Africa. His Petrochemical Industries Limited which manufactures oil lubricants and other various petroleum products both for local and international trade is believed to have the largest liquid storage facility for petroleum products in Nigeria, with a large capacity to store over 60,000 metric tons, and is located at the Apapa Warf and the Ibru Jetty Complex in Lagos, Nigeria, and this may never constitute a crime.

Unfortunately, while the souls of the poor in the society were busy thanking God for bringing Ibeto to their rescue and give meaning to their lives, Muhammadu Buhari came into power, and Ibeto Company applied

 

Dangote Ibeto1

Is Dangote Afraid of Competition

Ibeto partners Chinese firm

for foreign exchange from the CBN but was denied but Dangote applied and was granted, and has continued to enjoy all manner of waiver.

When Dangote saw that his brother has favoured him against Ibeto, he went ahead to do as he did during the Obasanjo rule. Sources have it that he approached his Fulani brothers, thereafter Buhari banned lbeto cement. Analysts since then have continued to say that Dangote and his brothers had to close down Ibeto because they are afraid of competition from an lgbo man who they believe is not part of the country. According to sources, "They know that lbeto has the ability to overthrow Dangote as the richest man in Africa and therefore decided to stopped him by all means".

Consequent upon the closure of lbeto cement by Buhari, the prices of cement jumped from N1,500 to N 2,500, exactly what Dangote has ever wanted, to make life unbearable for the poor masses. It is not just that Buhari closed down Ibeto cement, he went ahead to frozen Ibeto's account, has arrested Dr. Cletus lbeto on several occasions, questioned by security agencies harassed, humiliated and intimidated severally, and sadly the Igbo politicians who are dying for Nigeria's unity are not saying anything about it.

It is evident that there is no law in the Nigerian law books that Ibeto company has breached. There is no single crime known in the Nigerian criminal law system that Ibeto can be said to have committed, his only crime is that Hausa/Fulani in Nigeria has for long vowed never to allow an Igbo man be the economic powerhouse they were known for, and their desire to jeopardize the hopes and aspirations of the nations that constitute the place called Nigeria, but also to make Ndigbo of no significance in the society, but how far they can go in achieving this inhuman enterprise is wondered!

 

 

 

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