Good afternoon everyone. As Mike was pointing out, my name is Jennifer Zabasa and I am an anchor and a correspondent for Bloomberg Television based in Johannesburg. I'm very pleased and honored to be a part of this panel session today with Aliko Dangote, also Somaya Zubairo, and our two heads of state who will join us. As we've been hearing all morning, the discussion is really about a more regional integrated approach to investment and infrastructure. We're hoping to put the three different levers together that make up the ambition and hopefully accelerate some of the ambition that we have. We have of course one of the best examples of that in Aliko Dangote with the refinery in Nigeria, and also the policy portion of it, how we see our leaders potentially helping us to accelerate that, and the AFC of course convening this gathering and talking about the financial architecture that is needed to make this happen. So perhaps we get things started while we wait a bit. I wanted to just start here and maybe I start with both of you. Aliko, you're so far away. I don't know why. But luckily we have microphones. We've been speaking all morning and hearing from the presidents and the heads of state about some of the challenges that we've seen on the continent and the potential moving forward. What's been interesting is for the past two decades, if we take a look at AFC has been 20 years old, past two decades there's been more than a trillion dollars, US dollars, committed to infrastructure investment on the continent. And yet we're seeing the vulnerabilities of Africa at this point. Of course from your vantage point as someone who has this refinery that is revolutionizing the way we talk about industrialization on the continent, where do you think the gaps still are right now?
Well, thank you very much. It's great to be here. I must thank AFC and the government of Kenya for arranging this conference which is 'The Africa We Build'. I think, sorry, I have a bit of, you know, I've lost my voice really so I hope you can hear me. When you look at it today, we can do much, much bigger things. I think it was President Ruto who said that maybe we should forgive past leaders. But right now we don't have any excuse because we have very big financial institutions, we have big entrepreneurs. What actually caused the delay before was that normally when you go to those financial institutions, the interest is not to develop Africa, the interest is to develop themselves. And today we have big financial institutions that are at least they can listen to the big entrepreneurs and see how do we develop and build our nation. We have made a lot of mistakes in the past where we've been relying on foreign investors. A foreign investor will not come without the leadership of domestic investor. So a domestic investor must take the risk and start developing your own continent, not for you to wait for foreign investors. Foreign investor will only come when things are looking rosy and good. So I mean as we speak today, also when you listen to the speech of President Ruto, he actually summarizes almost everything that we are to discuss today. You know, you have 550 billion of pension funds in Africa and you are funding something totally that is irrelevant. And most of our own people too when they have money they take the money abroad. So when they know that we have money, we have what it takes to develop our continent. Every day we are saying potential, potential, potential for what? The potentials are there of course, but you have to harness the potentials. I mean, we've been having fuel cues in Nigeria for 52 years. Even when the refineries were sold, three out of four were sold to us in 2007. Later on the same people who are benefiting 10 billion dollars of corruption money went and instigated and it was reversed few months later which we lost a lot of money because we paid banks, we paid advisers, we paid lawyers, we paid everybody of which AFC was part of. So today as we speak, can we be where we want to be? The answer is yes, but we must build it ourselves as Africans, not by foreigners.
Thank you for that. And of course, we will welcome President Museveni and also President Ruto to the stage. We were just speaking about the gaps that still exist despite some of the investment that we've seen on the continent. I've been listening to both of you speak this morning and it seems like there is more cohesion between both of your countries. I wonder if you speak to an investor and you talk about what the regional collaboration looks like now. What's different now than in the past? What would you say? President Museveni?
What I think is different is that the mistake makers have failed. So people have seen the mistakes, the mistakes have blossomed, they have seen. I think that's why the people are beginning to see themselves different. You can see these are, I have been watching this for the last 65 years. I think Mr. Ruto, maybe are you 65?
58. You can imagine 50. So these young people have come up and they have seen. It would have been better if we, because like some of the other people like the Chinese, the people like you, they saw it earlier. But Africa also had a lot of additional problems like for instance landlocked countries, right? If you are landlocked, even if you see something, if the coastal countries don't see it properly, you can't move. So the mistakes are our biggest teachers. And the crises, the youth have no jobs, so I think people can now see, can listen more. Because there was a lure, it was really ideological intoxication. That if you, like for instance here in East Africa, how this East African Community broke up in 1977. People thought there was another way other than the East African Community. But now later on they discover that no, East African Community is the only way and that's how we came back.
President Ruto, have recent crises potentially accelerated some of this newfound collaboration between your countries?
Yes and no. I think the real question you've asked is what is different now? And I think there is realization by all of us that the solution to the challenges and problems we have is not out there. It is right with us. If you listen from what Dangote has said, he has said investors from out there will not invest in our countries unless we take the lead ourselves. Why would somebody else take a risk? How is it their business to build our countries? It's none of their business. And I mean rightfully so. First and foremost, we must realize that it is our responsibility. Others can only come to support us, but we must take the lead ourselves. And it doesn't start with entrepreneurs and industrialists like Aliko here. It starts with leaders like President Museveni and myself because a challenge that we have in our continent is a challenge of leadership. That's it. I mean, if the leaders are not willing to lead from the front, if the leaders are not willing to make the decisions, the policy choices that will take our country forward because some of the policy choices are not necessarily popular. It isn't easy for President Museveni to say if you are not making this choice we are not going with you, you know, banning export of minerals is not an easy thing because there are people who make money out of selling raw materials so you have to tell them no this is not the right thing to do. So some choices have to be made by leaders. So it starts with us as leaders making the right choices, not convenient choices, not necessarily popular choices, the right choices. That's number one. Number two, it is to stop what President Museveni was saying, petty jealousy between us. I'll give you an example. President Museveni decided that he's going to invest in the pipeline in Kenya because he believes that the pipeline in Kenya is not only important for Kenya but is also important for Uganda. When President Museveni told me, I went to him and I told him, 'Please give us some of your iron ore for our business people here in Kenya.' He told me, 'That is not the policy choice I want to make. I have already said nobody's going to take iron ore from Uganda unprocessed.' Then I made a choice that the investors who are in Kenya, I persuaded them to go and invest in the plant in Uganda. You know, I was not selfish about it because what will happen is that the iron ore in Uganda, the steel that is going to come from that iron ore is going to benefit not just Uganda, is going to benefit Kenya as well. Instead of us importing steel from all over the world, it is cheaper for us to import steel from Uganda. Right? And because this is one region. So this is the beginning, the leadership that determine how we move forward. Let me conclude by saying, listening to Aliko Dangote here, it is not just leadership at our level, it's also leadership at the level of our business people. It would have been easier for Aliko Dangote to do trade of oil. You know, I remember speaking to President Obasanjo and he told me he had a meeting with Aliko here and Aliko told him if you don't change the policies here, it is easier for me to import oil cheaper, I make more money, than to refine oil unless you make the right policy decisions. And that is what Aliko is telling us here. That the private sector and us will invest in the refinery. And by the way, we are discussing a refinery in Tanzania.
Yes. We are not discussing a refinery in Kenya or Uganda. We are discussing that we're going to have a joint refinery in Tanga to benefit all of us because that refinery is going to take on board the oil from DRC, the oil from Kenya, the oil from South Sudan, the oil from Uganda and we will just need to build a short pipeline from Tanga to Mombasa and the finished product will use the pipeline that we already jointly built with Uganda. So all our assets become profitable. But you need a longer-term view to see it than just a short-term, country by country. And that is why President Museveni was saying fragmentation is also part of our enemy. That is why some people broke up the East African Community because they didn't see the benefit of the bigger market. They were just looking at individual countries. So that is where we are at the moment. And it is different because we've all learned our lessons. The policy makers like myself and President Museveni, we can see with clarity where this should go. Industrialists like Dangote here, they too can see. And AFC right here with us and all these other good bank people, they also appreciate that it is their responsibility to invest in this infrastructure because it makes them money and it grows their bank balance sheets as well.
Thank you, President Ruto. Somaya, I wanted you to jump in because if we talk...
Somaya, I wanted you to jump in because...
Just hold on. What is also new is that if you look at Uganda, the pool of scientists whom we have now, we didn't have them at independence. We now have people who can do anything: automobiles, vaccines, electronics. So although we are meandering making mistakes but also some capacity was being built, education, knowledge, we've got a lot of scientists, there's nothing we cannot make. So that is also new. So it is capacity there. But what he's saying, the eyes to see the future workforce.
Somaya, I wanted you to jump in. When you talk to global investors, is this regional cooperation, is that becoming a prerequisite? Because it seems like you've been speaking about this for quite some time and it's seeming like now that we're getting government on board, this is actually starting to pick up steam and being the case for capital to actually be deployed. What are you hearing in your discussions?
Very good question. I'd like to lean in on two points raised. I think the key point is leadership. Leadership is extremely, extremely important to whatever we want to achieve. And I want us to look at leadership not just from a transaction that we want to do now but maybe from a long-term perspective. We need to embrace the idea of thinking about the next 15, 20, 30 years when we're thinking about development. So if you saw the report today on the state of African infrastructure report, it talked about the consumption over time, it says it's going to grow significantly and since we know that consumption is going to grow significantly, it only makes sense to look at regional infrastructure which is what is happening here. Another point I want to make is the need for this same leadership to be applied to capital mobilization. I cannot emphasize that point enough because Aliko mentioned it, I mentioned it as well and President Ruto mentioned it. He said who pays the piper dictates the tune. Capital has always been one of those enablers for development and we need to crack that code and it's not so difficult. It's not so difficult because what we need to do is to look at what we have. Our research shows we have 4.4 trillion, over 600 billion with pension funds, over 400 billion with insurance funds. That's 1 trillion. And these are traditional long-term investors. So what we should be looking at is the regulation that prevents insurance companies from playing in other jurisdictions, the regulations that focus more on short-term treasury bill investments as opposed to long-term productive investments. We need to educate our trustees and gatekeepers on the need to think of the future of the workers whose funds they are managing. It is not enough to say that you're managing funds for pensioners and their children will be unemployed. That doesn't make any sense. We must have that in mind that we must be managing holistically. So that means we must be deliberate around policy and on what will make policy work. So I come back to credit enhancements. You know, we're just starting this journey. We need to understand that the trustees are more focused on safety and liquidity. That's their job. So we need to find a way to make them comfortable to take longer-term risks. And I believe that within us in this room, the alliance of African financial institutions, the new architecture for financial, the new African financial architecture development that is being chaired by AfDB, within this room or within this group, we can create guaranteed programs that will take the initial risk from pension funds. So they're not looking at the project, they're looking at our own risks. And because we are going to develop and prepare this project, they can be comfortable that we will not put our money in things that don't work. I say this because we need to go beyond this 100 million, 1 billion, 2 billion. We should be looking at 20, 30, 40, 50 billion for development. And for me that is more important than any conversations that we can have with anybody. Let's focus on our needs for development. We have identified several infrastructure projects that need to be built. We have identified several refineries, fertilizer plants, all of these. They need billions of dollars. And we should be thinking about how can we use this opportunity, create those credit enhancements, create those guarantee programs that allow us mobilize 20, 30, 40 billion. I'm not interested in conversations. I mean we have conversations but I mean like Aliko mentioned, they are focused on their own objectives. I'm focused on African objectives. I'm focused on the future of the African child. I'm focused on what future are we leaving. So I'm more interested on what we can do together. I'm more interested on what leadership can get done and let's work together make these reforms in the insurance, in the pension sectors to ensure that capital moves around.
So, somewhat answered my question. A little bit of not so much a prerequisite, but just it's a nuanced discussion that you're having with investors. Now, Aliko, I wanted you to jump in because you have said you have an ambitious goal for the Dangote Group and want to invest where there's a lack of investment on the African continent. When you look at East Africa, what are the policy commitments that you need? You say you're already in discussion. What is it that you need?
I think what we need first of all is consistency in government policies. That's number one. And also the support of the governments here because I mean if you look at it really what we lack in Africa is quite a lot because we are a continent of imports and we're not really exporting much. We export raw materials which means when you export raw materials you are exporting jobs and when you import you are importing poverty because you are creating jobs out there not here in the continent. So I think with the support of the government that's nothing that is impossible and some of us were really tired of seeing our continent going out there to be begging for anything. I mean if you remember at the beginning of the war between Ukraine and Russia, the chairman of African Union that was President Macky Sall had to go and be begging for fertilizers and since that day I said okay fine by 2028 Africa will be self-sufficient in fertilizer and we are doing that. We're opening 20 blending plants in areas where they don't have the capacity. Also we are going to be at 12 million tons of urea, we are going to have massive potash and phosphate from Congo, Brazil and we believe we will satisfy most of the demands of Africa. I mean you look at it today with population of Africa 1.4 billion and also rising, right, we don't have raw material for detergent just to wash our clothes which we need every day. We don't have, we only have two factories, one in Egypt 50 tons, 100 tons in Algeria. So that's why we also launch now 400,000 metric tons of linear alkyl benzene which is the 100% raw material of detergent. So we have quite a lot of which before we don't have the capacity but right now with the likes of African banks, African bank, with the likes of Africa Finance Corporation, with a lot of support from other financial institutions following these two, there's nothing we cannot do in Africa. That's why we as a group we have now launched between now and 2030 we're investing 40 billion dollars in various fields.
Is part of that the refinery?
Even now I can give commitment to the two presidents that were here if they will support the refinery, we'll build the identical one that we have in Nigeria, 650,000 barrels.
So the discussions are still early though but the three of you it seems like you're trying to make this work.
It will work. Definitely. There's nothing that can stop it. We have done the one in Nigeria and that's why we are taking the bold move which we have started already. Piling has started. We are building that one to a scale of 1.4 million barrels a day which will be the largest in the world. That's number one. Number two, we'll have 10% of the entire United States of America's refining capacity. And this is coming with a lot of petrochemicals. And you look at it today in Nigeria if not because we have polypropylene, all the plant, all the businesses would have collapsed because cement is packed in polypropylene, flour, rice, grains, everything. So nothing, and the cost now has shot up between just 45 days from 900 dollars a ton to 3,000. That's no way you can afford it. So that is why we must learn how to build self-sufficiency. Right now we have big financial institutions that are very hungry for big ticket items and we are also big in terms of our own vision. You know, I mean before there's nothing that any one of us will sit down and say no, no, no, I want to build something like, you know, I mean when Somaya was heading our finance long time ago, this was 2003, 2004, 2005, we were even paying 44% interest rate in Nigeria. We had to go to IFC to raise money. Our first loan abroad was 478 million and this thing can be done, 478 million. Somaya gave them a calculation that okay we need 3 years loan, they said no you guys you don't know what you are talking about, you need 7 years, 2 years moratorium, 5 years payment. We say okay we agree because we are desperate for the money. When we took that money we paid it back before the expiration of the moratorium which is 18 months. I mean 24 months but we paid the money back in 18 months. So it is possible, Africans can do it. Let us not be scared. Let them not come and convince us that no somebody needs to carry our raw material to go and produce and bring the items here. I must really thank President of Uganda for taking this bold move, stopping the export, they will be forced, they will come and produce. Why do you take the raw material then you bring it back? We too we have educated people, we have big financial institutions, it's not like before, things have changed.
