Nigeria’s Economic and Financial Crimes Commission (EFCC) raided the offices of Dangote Group, Lagos, on Jan. 4, according to Bloomberg. The company, owned by Aliko Dangote, believed to be Africa’s richest person, is a major multinational industrial conglomerate involved in several businesses, including nitrogen fertilizer, oil, cement, and sugar.
Dangote Group in a statement said that it has faced no accusations of wrongdoing and called the incident an “unwarranted embarrassment.” It had no further comment. EFCC has yet to issue a comment.
The news sent panic through Nigeria’s corporate board rooms. “Manufacturers are concerned that if this can happen to Dangote, it can happen to any one of them,” said Segun Ajayi-Kadir, Director-General of the Manufacturers Association of Nigeria. “They are worried.”
Slamming the EFCC for the aggressive nature of its tactics, the association said currency allocations to more than 50 companies were under scrutiny and warned of a chilling impact on the economy.
“This news has gone around the world and many, including would-be investors, would be taken aback,” Ajayi-Kadir said in a separate statement. “This may not be the best way to show that Nigeria is committed to good corporate governance.”
Nigerian dollar bonds maturing in 2025 have fallen for seven consecutive days to the lowest since Nov. 28, their longest losing streak since September, suggesting that investors are watching what happens next.
Days before newly elected President Bola Tinubu took office in May 2023, Dangote opened its huge oil refinery to great fanfare. However, Tinubu was not among the attendees, though outgoing President Muhammadu Buhari and other heads of state were present.
The EFCC is expected to focus on the funding of the $18.5 billion refinery, which was built by Dangote and was granted access to money from the country’s central bank.
“It’s basically a signal to the business community that this government will go after anyone who they perceive may have the means to help fill the dollar gap in the government’s coffers,” said Cheta Nwanze of Lagos-based strategic consultancy SBM Intelligence.
To corporate Nigeria, it was also an unmistakable message about who was in charge. The raid came on the heels of Tinubu’s New Year’s Day speech in which he promised to “remove any clog hindering our path to making Nigeria a destination of choice for local and foreign investments.”
The EFCC’s raid on Dangote’s headquarters three days later triggered a scramble across Nigerian boardrooms to check their dealings with the central bank under Godwin Emefiele, who led it from 2014 until his ouster in June 2023.
Tinubu was highly critical of the forex practices of the central bank as he campaigned for the presidency last year, and suspended Emefiele within weeks of taking office. The central banker was arrested soon after on charges including fraud. He was taken into custody and released on bail last month.
A separate probe of Emefiele by a Tinubu-appointed special investigator has accused him, among other things, of manipulating the naira via a complex foreign-exchange regime.
Emefiele, a former governor, has denied wrongdoing. His trial on the initial charges is ongoing and no findings have been proven. He has not yet been formally charged in connection with the allegations raised by Tinubu’s special investigator.