While the Nigerian government is optimistically predicting that economic growth will climb to 3.5% in 2018, the IMF is projecting just 2.1% – a negligible performance in per-capita terms (Vanguard, 22.01.2018). Furthermore, contrary to the government’s rhetoric with regards to diversifying the economy the higher growth projection is predicated on increased oil output and higher prices (Africa Confidential, 12.01.2018).
As we begin the build-up to the 2019 elections, factional fighting and jockeying for positions will dominate the agenda as election campaigning gets underway, and reform and developmental efforts will stall. There is, however, a major economic landmark in sight.
In 2013 Aliko Dangote – already Africa’s richest man – signed a multi-billion-dollar deal to finance the building of an oil refinery in Nigeria – the largest in Africa (FT, 11.10.2013). Much to the frustration of the All Progressives Congress (APC) government, delays and cost increases to the project will mean that the refinery will arrive too late to help their re-election efforts. It is now estimated that the refinery will be operational by the end of 2019 at a total cost of between US $11 and $18 billion.
This article outlines what the project could mean for: (i) the Nigerian economy; (ii) Dangote himself; and (iii) for those who stand to lose out as the refinery disrupts the lucrative and corrupt downstream market.