Beyond IPO Debate: What the North Actually Needs to Build
Two write-ups by the duo of Sama’ila Mohammed and Gambo Hamza on Dangote shares make an interesting and compelling read, and both deserve more credit than they are likely to get from readers who pick a side and stop reading. On his part, Sama’ila Mohammed made an honest case for participation, whilst Gambo Hamza made […]
Sama'ila Mohammed and Gambo Hamza have both penned insightful articles on Dangote shares, each offering a unique perspective. Mohammed argues for participation, while Hamza focuses on structural ambition.
Mohammed asserts that the IPO is accessible, with a low entry price and no principled reason for a Northerner with disposable income to avoid it. This claim holds up under scrutiny, given the refinery's scale, dividend potential in dollars, and a subscription floor of ₦5,250. He also points out that financial literacy and capital-market participation have been weaker in the North due to colonial-era banking geography, lower trust in formal institutions, and a cultural preference for tangible assets.
Interestingly, Mohammed highlights that capital-market participation is also a habit that can be built at low stakes before scaling up. A young civil servant in Gombe, for instance, buying ten shares today, tracking dividends, and learning to read company results might eventually understand other financial instruments like bonds or local processing ventures. This exercise of subscription, tracking, and understanding ownership is a transferable skill, even if it doesn't immediately change anyone's material position.
However, Mohammed's argument can be seen as conflating financial inclusion with economic transformation. He lists Northern billionaires like Dangote, BUA, Indimi, and TY Danjuma without considering that their success is built on decades of capital accumulation, political access, and risk tolerance that cannot be easily replicated.
Moreover, presenting passive equity purchase as an act of "economic citizenship" risks teaching a generation that ownership is something acquired through transaction rather than something built through production.
Hamza, on the other hand, emphasizes the distinction between owning a small slice of someone else's enterprise and owning enterprise itself. He points out the informal economy comprising welders, mechanics, POP artisans, and food processors, as well as the well-capitalized businesses that serve Northern markets but are often owned or managed by outsiders. This observation reflects the kuli-kuli paradox – raw material abundance alongside minimal local processing and branding capacity.
Hamza's central distinction between shareholders and owners reframes the debate correctly: the focus should be on why the region has not produced more owners of the enterprises operating in its markets. This issue is not limited to kuli-kuli or sugarcane juice but extends to the North's industrial strengths like tanneries and sesame belts, which have seen a decline in processing capacity despite substantial raw material production.
While Hamza's argument is compelling, he fails to acknowledge that the absence of local processing capacity is not merely a confidence or enterprise-formation issue. He also errs in implying that the two paths are in tension, when in fact they serve different pools of capital, skill, and institutional support. A driver who buys ten shares with ₦5,250 was never going to finance a grain-processing plant.
The MSME ownership revolution requires a distinct capital base, skills, and institutional backing, and dismissing the IPO camp overlooks the broader economic potential.
Written by urgent.news from Daily Trust's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
