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Cheap imports choke cement producers

Date 15-Mar-2017
Subject Cheap imports choke cement producers

Cheap cement imports continue to flood the local market despite government having introduced a heavy import duty on the product to tame the tide, an official has said.

BY MTHANDAZO NYONI

Government last year introduced a 25% duty on every 100 tonnes of imported cement, to discourage cheap imports.

However, the reality on the ground, according to PPC Zimbabwe, is that imports continue finding their way into the country.

“In addition to liquidity challenges, we continued to face pressure from cheap imports. Government has tried to assist by introducing duty on imported cement, but the reality on the ground is that imports continue to pour in particularly from Zambia,” PPC Zimbabwe managing director Kelibone Masiyane told NewsDay.

“The high cost of manufacturing in Zimbabwe needs urgent attention, if the country is to remain competitive.”

Other countries exporting cement to Zimbabwe include South Africa, Mozambique and Botswana.

According to a position paper presented to the Ministry of Industry and Commerce by the Cement and Concrete Institute of Zimbabwe last year, cement manufacturers lobbied government to ban imported cement, saying the market was oversupplied.

Some of the measures included a protection tariff to equate the landed price of imported cement to the cost of the local product ($50/t cement), granting of import licences to local producers, cancellation or review of all issued permits that are circulating in the country (estimated at 5 000 tonnes/month or 5% total demand) and lowering duty on raw materials.

However, despite all this, PPC Zimbabwe remains confident that the economy will turn around.

“There are a number of infrastructural projects on the cards that we believe will take off this year and unlock our economy,” Masiyane said.

“The retail channel remains fairly stable owing to individual homebuilders who make up a greater percentage of our customers currently.”

He said the company currently has over 400 multi-skilled employees spread across their four sites in the country.

PPC has plants in Bulawayo, Harare and Colleen Bawn near Gwanda.

The company doubled its cement production capacity to 1,4 million tonnes per year after commissioning its $85 million plant in Harare last year.

The country’s demand for cement for the year is estimated at 1,17 million tonnes.

Source: Newsday.co.zw

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