According to the Bloomberg Billionaires Index, which is a daily ranking of the world’s richest people, on Tuesday, Africa’s richest man, Aliko Dangote fell 25 places on the index after his fortune dropped by $3.7 billion. This comes on the second day of the Central Bank’s new exchange rate regime. Prior to the commencement of this policy, which took effect on Monday, Dangote was at number 46 on this index but as of Tuesday, he fell to number 71.
Last week, the Central Bank of Nigeria (CBN) announced a new foreign exchange policy regime, which became effective on Monday. The CBN decided to allow the Naira float freely after years of successive pegging by the government and CBN governors. This means that the exchange rate was going to be determined by the forces of demand and supply. On the first day of trading, the Naira depreciated to N281/$1 at the interbank market. This also affected the Nigerian stock market, which recorded a loss of N164 billion. The market capitalization of the Nigerian Stock Exchange dropped from N10.045 trillion to N9.881 trillion.
Unfortunately Dangote Cement Plc. was among the losers of that day. Dangote Cement Plc. lost about 2 percent in trading on that first day, which also affected the fortune of Aliko Dangote whose wealth is derived from 91 percent stake in the Cement Company. As of Friday last week, Dangote Cement’s stock closed at N183.81 per share while it closed at N179.99 on Monday. The Nigerian Stock market also appreciated yesterday to N10.1trn, and in the process Dangote also gained. Dangote Cement Plc. closed its stock at N185 per share as of Tuesday but on the Bloomberg Billionaire Index, Dangote’s rank dropped from 71 to 80.