Africa's richest man, Aliko Dangote, gets $2.5 billion deal in Ethiopia

Africa’s richest man, Aliko Dangote, has reached a $2.5-billion agreement with Ethiopia to build and operate a major fertilizer plant, one of the country’s largest industrial investments to date.

The deal, signed in Addis Ababa with the state-owned Ethiopian Investment Holdings (EIH), gives Dangote Group a 60 percent stake, while EIH will hold the remaining 40 percent.

The plant, to be constructed in the Somali Regional State, is expected to produce three million metric tons of urea each year. This will be Dangote’s first fertilizer project outside Nigeria, marking a significant step in expanding his company’s presence across Africa.

Plant aims to cut imports

Ethiopia spends more than $1 billion each year on imported fertilizers to support its farming sector, which employs over 70 percent of the population. The new plant, connected to nearby natural gas fields by a dedicated pipeline, is expected to reduce imports and eventually position Ethiopia as a fertilizer exporter.

Construction is set to cost $2.5 billion and is scheduled for completion within 40 months. The project is a joint effort between Dangote Group and the EIH, a government-backed entity focused on managing public assets to drive national development. The partners may later expand production to include fertilizers such as ammonium nitrate and ammonium sulfate.

For Ethiopia, the plant promises stronger food security and a significant reduction in the foreign exchange spent on fertilizer imports. For Dangote, whose net worth Bloomberg estimates at $28.7 billion, the deal represents another step in addressing Africa’s growing demand for fertilizers over the coming years.

Dangote’s broader strategy

Aliko Dangote, who recently stepped down as chairman of Dangote Cement Plc, is expanding his industrial reach beyond cement. His attention is now on fertilizers and oil refining, reflecting his long-term goal of reducing Africa’s dependence on imports and boosting the continent’s agricultural capacity.

This focus is visible in his Ethiopian fertilizer project, which comes as Dangote Fertilizer Limited prepares for a listing on the Nigerian Exchange (NGX). The company could be valued at over $3 billion. In Nigeria, the Lagos plant—already the continent’s largest—is set on a 500-hectare site in Ibeju Lekki and can produce 3 million metric tonnes of urea each year, double the country’s current demand.

The extra output is expected to bring down costs for Nigerian farmers and serve markets across the region. Bloomberg estimates the facility at $3.02 billion, even if it operates at only half of its capacity, signaling substantial potential for growth.