Dangote Shuts Down $500 Million Cement Factory In Tanzania

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Reports say that Africa’s richest man has shut down his subsidiary cement factory in Tanzania after a disagreement with the government.

The $500 million worth factory was closed because of the high costs of operation and tax issues with Magufuli administration.

It is on record that Dangote’s cement factory in Tanzania was born after an invitation and mutual agreement with the past administration under Jakaya Kikwete.

See Also: Dangote Just Sacked 48 Workers – See His Reasons

In 2014 the billionaire was assured that he would have access to cheap natural gas to power the factory. Consequently the factory was established near Mtwara, where there are natural gas deposits.

With the assumption of John Magufuli’s administration came policies that countered the previous agreement of Dangote and former president Jakaya Kikwete.

The recent government denied Dangote’s firm the provision of natural gas like it used to be. Africa’s richest man on his part too kicked back by importing coal from South Africa despite Tanzania having substantial coal deposits.

This equally inspired another counter-economic policy for the firm. The Tanzanian government placed a ban on the importation of coal.



According to the government, the coal found in Tanzania is of a higher quality compared to the South African coal which Dangote was importing for his operation.

See Also: Dangote Sets Out To Invest Over $400 Million In Zimbabwe

With the ban, Dangote’s cement factory now spends as much as $4 million per month on diesel.

Harpeet Duggal, Dangote Tanzania CEO, said:

“Our plant uses six million liters of diesel per month to run generators after the promises to supply it with natural gas, which is produced in a nearby gas field, failed to materialize.”

The relationship between the Tanzanian government and Africa’s richest man had grown sour to the point that the billionaire decided to shut down the factory.

While Dangote says the cost of business had gone too high for him, the government officials insist that they have kept up with all the promised incentives including tax holidays as granted by the previous administration.

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