President of Dangote Group, Aliko Dangote, has blamed high taxes and regulatory burdens in Nigeria as the reasons why cement produced by his company is more expensive in the country than outside.
Explaining the price differential between exported cement, he said exporting permits his company to avoid a variety of taxes that would dramatically increase production expenses at home.
“When you look at my invoice, the cement I export is cheaper than the one I’m selling domestically, because that’s how exports work. In export I’m saving a lot of money, I’m not paying 30% income tax, I’m not paying 2%, education, I’m not paying 1% health, I’m not paying 7.5% VAT, and I’m not paying 10% withholding tax.”
By eliminating these costs, Damgote noted that he would be able to price Nigerian cement competitively in global markets against producers from Turkey, Russia, and China.
“So when you reduce all these taxes, I can afford to go and compete with the international market, with the likes of Turkey, Russia, and China,” he stated.
The billionaire industrialist has consistently stressed local manufacturing as a means of achieving economic self-sufficiency. How observers have continued to wonder why Dangote’s products are frequently cheaper outside of Nigeria than within the country. This shows that Nigeria’s fiscal framework makes it cheaper to sell locally produced items overseas than at home, reflecting deeper structural flaws in the economy.
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