CPPE defends Dangote refinery over alleged monopoly

The Centre for the Promotion of Private Enterprise (CPPE) has defended the Dangote Refinery over alleged monopolistic threat to Nigeria’s downstream petroleum sector, describing the claim as simplistic, fundamentally flawed and grossly unfair. The body insisted that Nigeria should prioritise policies that support domestic refining investments instead of encouraging increased fuel importation. The CEO of […]

The Centre for the Promotion of Private Enterprise (CPPE) has defended the Dangote Refinery over alleged monopolistic threat to Nigeria’s downstream petroleum sector, describing the claim as simplistic, fundamentally flawed and grossly unfair.

The body insisted that Nigeria should prioritise policies that support domestic refining investments instead of encouraging increased fuel importation.

The CEO of CPPE, Dr. Muda Yusuf, in a policy brief on Sunday, argued that decades of fuel import dependence created deep structural distortions within the Nigerian economy, weakened the naira, intensified foreign exchange pressures, and contributed significantly to fiscal imbalances under the fuel subsidy regime.

According to him, Nigeria must prioritise the protection and expansion of local refining capacity rather than encourage policies that could expose domestic investors to excessive import competition and regulatory uncertainty.

The CPPE said the era of heavy dependence on imported petroleum products imposed enormous economic and fiscal costs on the country while exporting jobs and industrial value abroad.

“Attempts to portray Dangote Refinery as a monopolistic threat are simplistic, fundamentally flawed and grossly unfair. The refinery did not prevent other investors from entering the sector. It did not cause the collapse of state-owned refineries. It simply undertook an extraordinary industrial investment at a scale unprecedented in Africa.

“For decades, Nigeria’s dependence on imported petroleum products created deep distortions within the economy. It exerted enormous pressure on foreign reserves, weakened the naira, accelerated the collapse of domestic refineries, entrenched a rent-seeking ecosystem, worsened FX illiquidity, fuelled corruption within the subsidy regime and imposed severe fiscal burdens on public finances.”

“Nigeria has just witnessed one of the most consequential industrial investments in Africa through the establishment of the Dangote Refinery, alongside growing investments in modular refineries across the country. These investments should ordinarily be strategically supported, celebrated and strengthened.”

“Instead, there appears to be mounting pressure for unrestricted importation of refined petroleum products — a policy orientation capable of undermining domestic refining investments and discouraging future industrial commitments,” Yusuf said.

He said Nigeria’s former subsidy regime consumed trillions of naira annually, while petroleum imports exceeded $10 billion yearly at peak periods.

The group argued that unrestricted fuel imports could discourage future industrial investments in Nigeria.

It maintained that genuine competition in the downstream sector should come through the establishment of additional domestic refineries rather than dependence on imports.

White noting that strategic sectors across the world often benefit from fiscal protections and supportive industrial policies, the CPPE added that large-scale industrial investments naturally improve competitiveness through lower production costs, stronger value chains, and enhanced economic resilience.