Nigerian billionaire Aliko Dangote told CNBC that a wave of asset selling
by the government could be the best way to boost Nigeria’s recession-hit
“I think the real challenge for us is now for us to have the political
will in terms of selling some assets,” he told CNBC Africa on Friday.
“I think it’s an easier route than the IMF (International Monetary Fund)
or the World Bank to borrow money, because what you need to do is actually
to beef up the reserves.”
Dangote spoke to CNBC Africa before Nigeria’s credit rating was downgraded
to B from B+ by S&P Global Ratings on Friday.
“Nigeria’s economy has weakened more than we expected owing to a marked
contraction in oil production, a restrictive foreign exchange regime
(Exchange: NGN=) and delayed fiscal stimulus,” S&P said in a report on the
Nigeria’s economy is set to contract on an annual basis in 2016 for the
first time in 21 years, with its all-important oil industry suffering
under weak global prices. The country’s gross domestic product (GDP)
dropped by 2.06 percent in the second quarter of 2016, after falling 0.36
percent in the previous three months.
Dangote is worth $12.5 billion and is the richest man in Africa, according
to Forbes. He is the owner Dangote Group, which bills itself as the
biggest manufacturing conglomerate in West Africa and has interests in
Dangote told CNBC that Nigeria, which rivals with South Africa to be the
continent’s biggest economy, should have been diversified a long time ago.
He lamented its overreliance on oil.
However, he was optimistic that Nigeria would exit recession in the fourth
quarter of this year and said the country “had all the answers” to bounce
back to health.
He urged the government to sell assets in some of its joint ventures with
the private sector in an open tender process. He said that Africa Finance
Corporation – a development finance institution established in 2007 –
would fetch close to $800 million. He said policymakers should also look
to sell 100 percent of the country’s stake in Nigeria LNG Limited, a
natural resources firm.
“If I had challenges in my company, I would not hesitate to sell assets,
to remain afloat, to get to the better times, because it doesn’t make any
sense for me to keep any assets and then suffocate the whole
organization,” Dangote told CNBC.