Africa’s richest man, Nigeria’s Aliko Dangote, said on Monday he plans to invest in a cement plant, coal mining and power generation in Zimbabwe — a country that is desperate for foreign investment, EconomicTimes reports.
The billionaire, whose business interests include Dangote Cement, said he would spend close to $400 million on the Zimbabwe cement plant. He plans to produce 1.5 million tonnes of cement a year, which will make it Zimbabwe’s largest plant, according to TheGuardian.
“We’ve already decided to invest into Zimbabwe, that’s why we are here,” Dangote told journalists in Harare. “Any country where you see us visiting it means, yes, we’ve decided to invest.”
Last week, Dangote announced he had signed a $4.3-billion deal with a Chinese government-owned engineering company to build eight new cement plants. Zimbabwe was not on the list of countries.
Cameroon, Ethiopia, Kenya, Mali, Niger, Nigeria, Senegal and Zambia, were, according to Reuters.
Dangote met with Zimbabwean President Robert Mugabe and Vice President Emmerson Mnangagwa Monday.
It was “a very, very good meeting with the president,” Dangote said, according to AFP.
Construction could begin as soon as the first quarter of 2016, according to EconomicTimes.
Dangote is investing in Zimbabwe at a time when its government is blaming drought for hitting the agriculture sector, and for pushing down the country’s economic growth target for this year to 1.5 percent.
Zimbabwe has lagged behind neighbors like Mozambique and Zambia in attracting foreign investment. However the government said in July it had approved $971 million in foreign investments in the first half of 2015 versus $555 million a year ago, EconomicTimes reports.
Its economy collapsed since Mugabe’s land reforms of 2002, which broke the country’s agricultural backbone, NGGuardian reports.
Laws which require locals to hold majority stakes in all companies are also blamed for scaring off foreign investors. Many companies have moved, downsized or closed.
Investors often point to Zimbabwe’s black economic empowerment law, which requires foreign-owned firms to sell majority shares, as an obstacle to investment, EconomicTimes reported. A cabinet minister said Sunday the law would be relaxed.
Food shortages, economic sanctions, billion-percent hyperinflation and disputed elections have also hurt the Zimbabwe’s citizens in recent years.
Dangote said his investment package will create jobs and “help Zimbabwe to develop their own economy,” Bloomberg reported.
Some analysts say the economy could tip back into recession this year due to the drought and falling metals prices, EconomicTimes reports.
The country’s No. 1 platinum producer, Zimplats, announced an annual loss on Monday — only the second time in its history.
Dangote Cement faces intense competition in the African cement sector, particularly from Lafarge Africa, which combined its South Africa operation with its publicly traded Nigerian business in 2014 to accelerate growth on the continent, according to Reuters.