Our flexible packaging solutions bring value to Nigeria— Dow
In this interview with ODINAKA ANUDU, Lanre Dairo, public & government affairs manager (West Africa), Dow Chemical Company, speaks on the company’s footprint on the West African region.
Tell us about your operations in West Africa.
Dow has a long-standing history in West Africa. Our corporate presence in the region started in the 1990’s, though political and business reality mandated operating solely through distributors for a period until 2012 when Dow officially re-entered West Africa with corporate offices in Ghana, followed by Nigeria in 2015.
Dow serves West Africa from these two countries, with Dow Ghana, a sales licensed entity, currently the hub for operations and business development for Francophone West Africa. The plan is to have an office in Ivory Coast that will be the hub for Francophone, while Nigeria remains our regional head office for West Africa.
Dow West Africa is positioning to support rapid growth in the region by ramping up local footprint, creating greater access to global expertise and providing growing product capacity through our Sadara joint venture – the largest chemical complex ever built in the world in a single phase, with 26 integrated world-scale manufacturing plants, over 3 million metric tons of capacity per year and a total investment of about $20 billion. Dow uses its strengths as a technology and innovation leader – committed to sustainability – to build and advance existing partnerships and forge new mutually beneficial relationships in the region.
Dow businesses in the region are agro sciences, coating materials, polyurethanes, plastics, oil & gas, performance systems and industrial solutions, with shared selling for other businesses such as water, microbial control, construction chemicals and consumer products. The future growth potential of the market should have most (if not all) Dow businesses fully represented in the region.
In specific terms, how much contribution has Dow made to the Nigerian and the West African manufacturing sectors within the last five years?
Dow combines the power of science and technology in helping manufacturers grow and be more sustainable. Our innovations are found in a wide variety of industrial settings. We have helped in the manufacturing of goods and services with additive solutions that minimiSe friction and heat in mechanical processes; manage the oil and water interface; deliver active ingredients for maximum effectiveness; facilitate dissolvability, and enable product authentication.
Beyond our products and services, it is our view that by partnering with other private sector and multilateral institutions or governments, we can fulfil a significant role through involvement in the development of manufacturing-focused public policy.
Dow has been successful in completing and implementing advanced manufacturing plans for some of the world’s largest markets. These include Argentina and Australia as well as one for Brazil (on-going). With momentum currently shifting towards sub-Saharan Africa, many governments on the continent have prioritised manufacturing and industrialisation as a means to kick-start their economies and increase the number of jobs and boost skills. With governments recognising the importance of manufacturing and looking to the private sector for increased collaboration, Dow is in a unique position to support them in the achievement of their development goals by transferring our own expertise, experience and solutions to our government partners and their projects.
How much has Dow invested in West Africa since 2013 when it entered the regional market?
We currently cover 23 countries in West Africa from Nigeria and Ghana and we are considering opening a third office in Ivory Coast with plans to build local warehouses, and establish semi processing plants.
Dow West Africa is positioned to support rapid growth in the region by ramping up local footprint, creating greater access to global expertise and providing additional product capacity from our Sadara joint venture – the largest chemical complex ever built in the world in a single phase, with 26 integrated world-scale manufacturing plants, over 3 million metric tons of capacity per year, and a total investment of about $20 billion.
Tell us about the number of jobs you have created so far.
Our operations in West Africa support the local manufacturing sector and have a key role in job creation and long-term prosperity. It employs millions of people, drives research and development, drives innovation, creates new products, while pushing the frontiers of science and technology. No other sector has the power to create more jobs. For every job created in the manufacturing sector, three to five jobs are created across the economy. We need to develop and implement a national strategy focused on creating an environment that will enable this manufacturing renaissance to take hold.
How are you dealing with the competition in sub-Saharan Africa, especially Nigeria?
At Dow, we are constantly evolving and innovating to meet our customers’ needs and stay ahead of the competition. At the core of this is our expertise. Behind every innovation at Dow is a team of world-class researchers able to move transformative ideas into real-world solutions. Our technical specialists, market knowledge, resources, and relationships deliver innovative solutions to the markets we serve. Dow’s commercial and technical expertise is strategically located across 16 countries in the Middle East, Africa and Turkey (MEA&T) region, allowing us to be close to our customers and ready to support their investment plans. Specifically, we have five technical experts located across the region, with three in Africa.
Additionally our recent global merger— ‘merger of equals’— creating DowDupont, brings together the complementary portfolios of Dow and DuPont to create three strong competitors that will lead their respective industries through productive innovation to meet the needs of customers and help solve global challenges.
DowDuPont brings together the complementary portfolios of Dow and DuPont, two innovative, science-based companies that hold leadership positions in the agriculture, materials science and specialty products industries. Working together, we intend to create three strong, independent companies that will be more competitive than either company could be on its own and well equipped for science-driven, profitable, long-term growth.
Dow has been in the forefront of championing flexible packaging in West Africa. What is the level of acceptability of flexible or plastic packaging in the region?
Firstly, we should always remember that a package protects the product and serves as a vessel to take the product from the factory floor to the point of purchase. Better performing packages will positively affect the bottom line, because waste reduction leads to lower costs and better profitability. Good barrier properties lead to longer shelf life, so fewer products are wasted, and better seal integrity may lead to longer shelf life, much to the brand owner and consumer’s satisfaction.
Dow’s solutions are created with the entire product life cycle in mind, and our experts can help customers make the right decisions to optimise cost savings. We understand that volatile prices and rising costs of raw materials increase production costs and reduce margins for manufacturers, who are increasingly searching for cheaper substitutes. This is where our flexible packaging solutions bring value. Their light weight ensures lower transportation overheads (as the vehicles use less fuel) and reduces overall supply chain costs.
Do you have confidence in the West African market, considering peculiar issues such as poor infrastructure, multiplicity of taxes, challenging politics and policies, among others?
Absolutely. Challenges notwithstanding, the potential is undeniable. West Africa is crucial to our company’s future growth and business success. It is the last frontier. There are few places in the world with such high potential growth rates, strong commitment for investment and untapped opportunities. While the region faces economic headwinds today – as a result in lower commodity prices, currency issues, droughts, political uncertainty, and security issues – West Africa remains a vital part of Africa, a growing continent in the world, just behind Asia. This is because some of the fundamentals are strong. Investment in infrastructure remains high. It is the second largest destination for Foreign Direct Investment (FDI) inflows in the world, behind the Asia Pacific region. Banks are healthy: the 200 largest banks have combined assets worth $1.5 trillion – about 75 percent of the continent’s GDP.
So not only is the continent abundant in natural resources, it also sits on significant untapped financial resources. The Investment Focus on Africa has become long term – also for Dow. Dow has what Africa needs: Science and technologies for infrastructure, construction materials, mining, oil and gas, water, clean energy, packaging and consumer goods. I don’t have to remind you that we are not alone in seeing the opportunities. Many Fortune 500 companies are already very strong in West Africa or have their eye on the region as well.
What are your future plans for West Africa, particularly the Nigerian market?
Dow is positioning to support rapid growth in Nigeria and the larger region by ramping up local footprint, creating greater access to global expertise and providing additional product capacity starting from our Sadara JV.