The management of Dangote Industries stated that rather than engage in illegal foreign exchange deals and money laundering as being alleged, the company’s pan-African operations have repatriated over $576 million to Nigeria.
The Management of Dangote Industries Limited has debunked the allegation that the company is being investigated for alleged illegal foreign exchange deals and money laundering running into $3.4 billion through the Central Bank of Nigeria (CBN) under the leadership of the embattled former CBN Governor, Godwin Emefiele.
The management of Dangote Industries stated that rather than engage in illegal foreign exchange deals and money laundering as being alleged, the company’s pan-African operations have repatriated over $576 million to Nigeria.
In March 2016, there were media reports alleging that Dangote Cement engaged in economic sabotage through fraudulent foreign exchange and that "monies went from the company in question to other sister Dangote companies outside Nigeria.”
The reports which were published as advertorials further stated: “It is estimated that almost USD3billion - if not more, has been taken out of Nigeria through these means. This encourages round tripping and in effect money laundering since there is no proper documentation."
Though the publishers of the story in 2016 tendered public apologies to Dangote Industries saying the advertorial was sponsored and that they were never aware that the report was hurtful to the company, the allegation resurfaced recently following the ongoing probe of the CBN transactions under Emefiele.
However, in reaction, the management of Dangote Industries said that the allegation was only “peddled out of malice by a competitor masquerading as a concerned Nigerian in 2016, describing it as a falsehood that is detrimental to its corporate reputation”.
It said, “The attempt by the authors of this misleading allegation to give it a fresh life in the media is baffling as the two newspapers that were misguided into publishing it as advertorial then (2016) have since publicly apologized to the Management of Dangote Industries Limited in writing as well as retracted the advertorial in its entirety in their respective publications.
“Indeed, BusinessDay and Leadership Newspapers admitted that the advertorials were sponsored and paid for by Messrs. BUA Group.”
According to the statement, the company explained that it embarked on massive expansions of its business across Africa which led to the construction of cement plants; “and for the avoidance of doubt, Senegal, Ethiopia, Zambia, Tanzania, Cameroon, South Africa, Congo Brazzaville, Sierra Leone and Ghana were completed and commissioned while construction works in other African countries are nearing completion”.
It said, “In compliance with regulatory requirements, we, like other Nigerian companies and banks with investment in subsidiaries in and outside African countries, requested our Authorized Dealers to seek CBN approval to source FX locally to enable us fund the construction and establishment of the cement plants outside Nigeria.
“We secured CBN approval to source FX specifically from Interbank Market to fund the construction of these plants and this has always been complied with.
“Specifically, CBN gave us approvals between 2010 to 2018 to purchase FX totaling USD3.755 billion from the Interbank market for the funding of our various African Projects out of which we have utilized only 47.70% of the approvals in the total sum of N1.791 billion.
“We wish to reemphasize that foreign exchange for these projects were sourced strictly from the Interbank Foreign Exchange market in compliance with the CBN approvals and CBN press release dated February 18, 2015.
“In all these transactions, Letters of Credit were established for the construction of the Plants and for the purchase of heavy equipment and spares required for the commissioning and take-off of the Cement plants.
“The terms and conditions for payments on the transactions were clearly spelt out in the Letters of Credit instruments and in line with International Chamber of Commerce - Universal Customs & Practice for Documentation Credit - UCP 600.
“It is also crucial to note that the Letters of Credit in favour of Sinoma International Engineering Co Ltd (a Chinese Government owned company), being the major contractor who accounted for over 75 percent of these expenditures, were paid against the presentation of all relevant shipping documents. There was no single payment that was made through any Dubai company owned by us.
“We have recorded tremendous success stories in all our pan-African cement plants by way of Foreign Exchange repatriation of USD576,008,672.41 through various banks in Nigeria, inclusive of USD111,968,109.38 Cash Swap arrangement between Dangote Cement Plc and Ethiopian Airlines which was approved at an official exchange rate by Central Bank Nigeria (CBN) and National Bank of Ethiopia, thus saving the same amount that would have been paid by the CBN.”
The company further stated: “Funds invested in our expansion project across African countries are legitimate capital investments in those countries and the repatriation of FX in sum of USD576 million so far helps to boost foreign Exchange earnings in Nigeria and stabilize the FX Market.”