Onome Amuge

Aliko Dangote, one of Africa’s most prominent industrialists recently broke ground for the $2.5 billion Dangote-Gode Fertiliser Plant in Ethiopia earlier, creating what is considered more than another chapter in the Nigerian billionaire’s industrial playbook, but also a statement on how African capital is beginning to redraw the map of continental development.

The project, a partnership between Dangote Group and Ethiopian Investment Holdings (EIH), will produce three million metric tonnes of urea annually, leveraging Ethiopia’s Hilal and Calub natural gas reserves. But beyond the numbers, the Gode plant represents a shift toward intra-African industrial collaboration at a time when global capital flows into Africa are tightening.

For Ethiopia, it represents an endorsement of its economic reforms and a much-needed signal to global investors that Africa’s second most populous nation remains open for business. For Dangote, it is another opportunity to demonstrate that Africa’s growth story can, and should be written by Africans themselves.

The Dangote-Gode fertiliser complex is not being built with concessional loans from China or Western development agencies. Instead, it is being financed and executed through a blend of African capital, technical expertise, and public-private collaboration. Dangote confirmed that financing is being provided by a consortium of African institutions, including Afreximbank, the Africa Finance Corporation, Access Bank, First Bank, and Zenith Bank.

This model of African-led industrial investment marks a strategic evolution. As Dangote himself noted during the ceremony, “We’ve demonstrated that Africa has both the capacity and capital to build the industries that will drive its future. Only Africans can truly transform Africa.”

His words come at a time when foreign direct investment into Africa has slowed, dropping 3.5 percent in 2024 according to UNCTAD data, as investors grew more risk-averse amid global uncertainty. However, African private capital, from conglomerates, pension funds, and banks, is increasingly filling the gap.

“This is a symbolic moment. We’re witnessing African institutions funding African-led industrialisation. It’s the economic independence we’ve talked about for decades taking tangible form,” said Umaru Kwairanga, chairman of the Nigerian Exchange Group, who attended the event. 

Abiy Ahmed, Ethiopia’s Prime Minister, called the project more than just an industrial progress. For him, the Dangote partnership represents shared responsibility, cooperation, and peace.  It also dovetails neatly with his administration’s 10-year development plan, which aims to turn Ethiopia into a manufacturing powerhouse through targeted investments in energy, logistics, and agriculture.

The Gode site, located in the country’s southeast Somali region, will tap into nearby gas fields to produce urea for both domestic use and export. Ethiopia currently imports up to 80 per cent of its fertiliser needs, a dependency that costs the country hundreds of millions of dollars annually and exposes it to global price shocks.

“The strategic logic is clear. If Ethiopia wants to ensure food security, reduce forex pressure, and expand its industrial base, it must invest in fertiliser production. Dangote brings the capital, technology, and track record to make this happen,” said Biru Taye, chief executive of Ethiopian Investment Holdings. 

The Ethiopian government, for its part, has been steadily liberalising its economy, opening formerly closed sectors to private investment. Dangote praised the administration’s reforms, including the rollout of public-private partnerships and the Grand Ethiopian Renaissance Dam, which he described as “the foundation for industrialisation.”

The development  is not Dangote’s first foray into Ethiopia. His cement subsidiary has operated a 2.5 million-tonne plant in Mugher for over a decade. With an additional $400 million already committed to doubling its capacity, Ethiopia has become a crucial node in Dangote’s continental footprint.

Across Africa, Dangote Industries has pursued a consistent strategy: vertical integration and localisation. From Nigeria to Senegal, Cameroon, and Zambia, his investments in cement, fertiliser, and petroleum products have focused on converting raw materials into finished goods within Africa.

“These investments have already changed Nigeria’s story. We’ve moved from being import-dependent to becoming self-sufficient and exporters of cement, fertiliser, and petroleum products. Our mission is to help other African nations achieve the same transformation,” Dangote said. 

By positioning Ethiopia as a future fertiliser hub, Dangote is effectively betting on agriculture as Africa’s next growth frontier. The continent’s fertiliser consumption remains among the lowest in the world, despite having 60 per cent of the planet’s arable land. Closing that gap could unlock billions in productivity gains and reduce the continent’s dependence on imported food and agrochemicals.

According to analysts, the implications of the Gode plant stretch far beyond Ethiopia’s borders. The Horn of Africa, long associated with humanitarian crises and geopolitical tension, could see a new phase of industrial-led growth. Analysts noted that the facility could export to neighbouring markets such as Kenya, Djibouti, and Sudan, boosting cross-border trade under the African Continental Free Trade Area (AfCFTA).

For Nigeria, Dangote’s expansion underscores the maturing of its private sector champions, bringing forth companies capable of scaling across borders and shaping policy through execution. The project also opens a diplomatic channel between Abuja and Addis Ababa, as both nations seek to deepen economic ties and collaborate on industrial policy.

Dangote also hinted at plans to establish a polypropylene bagging plant, which would enable local production of fertiliser packaging materials and reduce import costs. “We’re not just building a plant. We’re building an ecosystem,” he said. 

Mustafa Omar, president of the Somali Region, called Dangote “the anchor investor Ethiopia has been looking for,” describing him as a trusted partner who brings credibility and execution discipline.

The Gode fertiliser project is part of a larger pattern in Dangote’s continental strategy. His group has invested over $25 billion in African manufacturing and infrastructure in the last decade, from Nigeria’s 650,000-barrel-per-day refinery to cement plants in 10 countries.

Each project follows the same logic of  harnessing local resources, reducing import dependence, and creating regional export capacity. Together, they form what some analysts are calling “Dangote’s Pan-African supply chain”, a self-reinforcing network of industrial assets designed to keep value within the continent.

In Ethiopia, the implications are particularly significant. By tapping domestic gas to produce fertiliser, the Gode plant could save the government hundreds of millions in foreign exchange while stabilising input costs for farmers. Over time, this could boost agricultural productivity, improve food security, and contribute to Ethiopia’s goal of becoming a net exporter of agricultural goods.

Still, challenges remain ahead. Ethiopia’s logistics infrastructure is under strain, and its forex market remains tightly controlled. Political stability, though improving, is fragile in some regions. Yet Dangote’s decision to proceed despite these risks speaks to his long-term confidence in the country’s trajectory.

“Every major industrialisation journey begins with a bold bet. This is ours for East Africa,” said Vishwajit Sinha, CEO of Dangote Fertilisers Ltd. 

If successful, the Dangote-Gode project will not only redefine Ethiopia’s industrial sector but also reinforce a larger idea that Africa’s next economic revolution will be powered not from abroad, but from within.