Africa is, once again, poised for a year of strong economic growth in 2015. The International Monetary Fund forecasts that aggregate GDP growth will be more than 5% in 2015, but underlying economic expansion is not enough to make money in these dynamic – but often difficult – business environments.
Foreign direct investment into Africa continues to grow, bringing more capital, and new competition, into the continent’s key markets. The expansion of populations, urbanisation, the growth of the consuming middle class and the increasing penetration of the internet are all powerful trends, but whether a company is able to ride the wave, rather than sink beneath it, often hinges on individual personalities and how they react to change or failure.
African Business has identified 15 African business leaders positioned to take advantage of the continent’s opportunities in 2015; those individuals well equipped to ride the technological, demographic and social trends that will drive Africa’s development.
Why is Aliko Dangote, arguably Africa’s most successful (and richest) businessman leading our list of leaders to watch in 2015? One, Dangote remains an icon and has been ‘watchable’ since he first made his mark.
What makes 2015 particularly interesting where Dangote is concerned is to see how the master strategist applies his long-term dictum to turn ‘challenges into opportunities’. This time around, he does have more than his usual quota of challenges to deal with.
Dangote, with operations in 16 countries, remains the continent’s ‘cement king’ although sales have stalled in Nigeria in particular as a weaker economy, facing the prospect of a steep price drop in crude oil, has cut back on construction. Dangote has slashed the price of cement by 40%, panicking his rivals and trying to persuade reluctant builders to stock up while the going is good.
How will his tactics shake out? Watch and see.
The long-awaited listing of Dangote Cement on the London Stock Exchange – a milestone in the growth of the group’s international profile – was once again delayed.
Reasons for this are not clear but sooner or later, as the global economy stabilises, perhaps on the back of cheaper oil, the demand for cement will once again rise.
Again, how he deals with this issue could be a lesson for the younger generation of business leaders.
In the final quarter of 2014, the Investment Corp of Dubai (ICD) invested $300m in his cement business. Further deals in oil and agriculture could run into billions of dollars.
In 2014 Dangote signed a joint venture with US private equity firms Blackstone Group and Carlyle Group to explore opportunities in the oil and gas sector across sub-Saharan Africa. Other joint ventures and investments in sugar and cement in Southern and East Africa are also on the cards.
According to Bloomberg, Dangote is sitting on a $23.1bn fortune, built by “seeing the opportunities where others see only challenges”.
Expect more of the same in 2015 from a man who continues to charge ahead.