Dangote Shuts Down $500m Cement Factory In Tanzania

Africa’s richest man, Aliko Dangote has shut down his $500 million factory in Tanzania owing to high business costs and a fall out with the government over tax exemptions. Dangote was invited to Tanzania to do business by former President Jakaya Kikwete in 2014 and was promised access to cheap natural gas to power the factory.

As a result, the Dangote factory was sited at Mtwara where natural gas is extracted. The end of Kikwete’s administration has spelled trouble for the factory as the government of John Magufuli has reneged on many of the original agreements, refusing to provide cheap natural gas for the factory. Dangote then retaliated by importing coal from South Africa despite Tanzania having substantial coal deposits.

Magufuli’s administration eventually banned the importation of coal, a policy which seemed specifically targeted at Dangote. The government has said Tanzanian coal is of higher quality than South Africa’s and therefore saw no need to allow companies import it. The factory now spends as much as $4 million per month on diesel

Despite Dangote’s protests, government officials say they have upheld all the incentives such as tax holidays granted to Dangote by the former administration.

Unofficial sources say many of the incentives granted to Dangote were unconstitutional and have been scrapped and the decision to close the factory is an attempt to force the government’s hand.

1 Comment

  • This is the case with the children of Israel in land of Egypt. A king that knew Joseph and another that knew him not. The one that knew Joseph, God liberated and exempted his kingdom from the scourging famine that lasted for 7years because he accepted Joseph but the one that bothered himself not to no history of the former king and Joseph put his nation in an irrecoverable anarchy which led to multiple death and left the land desolated.
    So watch it the government of Tanzania because Dangote is like unto you a Joseph sent by God to deliver your country in many ways. I urge therefore settle among yourselves amicably any form of discord and bitterness which must have transpired. May God help you.

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