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Ethiopia, Dangote sign $2.5bn deal for mega fertilizer plant

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Prime Minister Abiy Ahmed of Ethiopia and Aliko Dangote witnessing the signing. Image courtesy of the Office of the Prime Minister – Ethiopia.
Prime Minister Abiy Ahmed of Ethiopia and Aliko Dangote witnessing the signing. Image courtesy of the Office of the Prime Minister – Ethiopia.
  • $2.5bn complex in Gode to produce 3 million metric tons of urea annually
  • Ethiopia aims to join world’s top five producers, boost food security

 

ADDIS ABABA, ETHIOPIA – Ethiopia has signed a $2.5 billion deal with Nigeria’s Dangote Group to build a fertilizer production complex that could transform the country into one of the world’s largest producers of urea.

The agreement, inked with Ethiopian Investment Holdings (EIH), will see Dangote Group take a 60 percent stake in the project, with EIH holding the remaining 40 percent.

Construction of the complex in the eastern city of Gode is expected to take 40 months, with output projected at three million metric tons of urea annually.

Prime Minister Abiy Ahmed hailed the project as a breakthrough for Ethiopia’s food security strategy. “Congratulations to all Ethiopians on another milestone in our journey toward food security and agricultural transformation,” Abiy said on Thursday. “This mega project will create jobs locally, ensure a reliable fertilizer supply for our farmers, and mark a decisive step in our path to food sovereignty.”

Food security and industrialisation

The Gode facility would be among the world’s largest of its kind, boosting Ethiopia’s ambitions to industrialise its economy and reduce reliance on imports.

Aliko Dangote, chairman of Dangote Group, said the venture underscored Africa’s drive toward self-sufficiency.

“This partnership with Ethiopian Investment Holdings represents a pivotal moment in our shared vision to industrialize Africa and achieve food security across the continent,” Dangote said.

“The strategic location of Gode, combined with Ethiopia’s abundant natural gas resources, makes this an ideal location for what will become one of the world’s largest fertilizer complexes,” he added.

Experts commended that reliable access to urea will improve yields, boost farmer incomes, and reduce exposure to volatile global markets. This aligns with broader African goals of reducing import dependency and strengthening intra-African trade under the African Continental Free Trade Area (AfCFTA).

“The launch of Gode Fertilizer Manufacturing marks a major step forward for Ethiopia’s sectoral investment,” Agibusiness Consultant and member of Chinese Embassy Agricultural Expert Team, Dr. Kassahun Delene told Allen Dreyfus.

“With no prior large-scale experience in fertilizer production, the facility gives Ethiopia a critical subsidiary industry that will directly support the agricultural sector, strengthen national food security programs, and contribute to broader African regional economic integration.”

A national milestone

Brook Taye, CEO of EIH, said the agreement was a crucial step in Ethiopia’s economic transformation.

“This landmark agreement with Dangote Group marks a significant milestone in Ethiopia’s journey toward industrial self-sufficiency and agricultural modernization,” Taye said.

“The project aligns perfectly with our development priorities and will substantially enhance productivity while positioning Ethiopia as a regional hub for fertilizer production.”

The project is considered one of the largest industrial investments in Ethiopia’s history and is expected to play a key role in meeting rising domestic and regional demand for fertilizer.

The project holds significant promise for Ethiopia’s farmers, offering an opportunity to reduce reliance on imports and stabilize agricultural productivity. However, Dr. Delene cautioned, regional security challenges may pose risks to its smooth implementation.

“As the population continues to grow, the demand for fertilizer will only rise, making it essential to ensure that such projects are safeguarded and effectively managed to meet the nation’s future needs,” Delene tells Allen Dreyfus.

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