Aliko Dangote, Africa’s richest man, has announced a $400 million plan to push a second production line at the Mugher cement plant in Ethiopia, a move expected to double the facility’s annual output to 5 million tons.
The Mugher plant, which began operations in 2015 with an initial capacity of 2.5 million tons per year, has faced major challenges.
Regional unrest led to repeated attacks on company property. In 2018, the country manager and two employees were killed in an attack.
Despite these challenges, Dangote remains committed to Ethiopia, seeing it as a crucial market in his growing African cement empire.
Despite these setbacks, Dangote Cement, which operates in 10 African countries, remains committed to expanding its footprint in Ethiopia.
The Mugher plant is a key part of the company’s strategy to increase its annual cement production capacity across the continent to 55 million tons.
In 2015, the Dangote Group invested $19 million to add a bagging plant at the Mugher facility, enabling it to produce 120 million bags of cement annually.
The latest expansion will include a new greenfield grinding unit near Addis Ababa, boosting the plant’s capacity to 5 million tons per year.
What Dangote said
Dangote, Chairman and CEO of the Dangote Group, described Ethiopia as his “best investment destination,” citing the country’s improving investment climate. He also emphasized the role of African business leaders in driving the continent’s progress.
“Africa will be developed by Africans, “As our political leaders work to strengthen the African Union, we as business leaders must complement their efforts by deepening commercial linkages across the continent.”
Dr. Brook Taye, CEO of Ethiopian Investment Holdings, lauded the investment, highlighting Ethiopia’s focus on industrialization and private-sector growth.
“Ethiopia is undergoing a significant economic transformation that prioritizes industrialization, investment, and job creation. This investment is a strong signal of confidence in Ethiopia’s business environment and will significantly contribute to our infrastructure and economic growth,” he said
What we know
The expansion of the Mugher plant shows Dangote’s commitment to Ethiopia’s economic growth and its position as a key player in Africa’s industrial development.
- The capacity of the Dangote Mugher cement plant will be increased from 2.5 million to 5 million tons per annum with the addition of a new greenfield grinding unit near Addis Ababa.
- Beyond cement, Dangote Group is also expanding into Ethiopia’s sugar industry by enhancing operations at Omo Kuraz Sugar Company, leveraging its experience in Nigeria.
- The company is further considering the establishment of a urea production plant, contingent on Ethiopia’s natural gas development, to support agricultural productivity.
Dangote is currently worth $28 billion according to wealth estimates by the Bloomberg Billionaire Index at the time of writing.