Yonas Abiye
12 May 2009
Addis Abeba — Cement factories will halt production owing to chronic shortage of power supply in the country, Minister of Works and Urban Development announced yesterday.
Production of cement at these factories will thus be suspended as of today, May12, 2009.
The Ministry also revealed that close to two million quintals of cement will be imported for May and June consumptions to fill the supply crunch.
The country has been hit by acute power shortages prompting the Ethiopian Electric Power Corporation (EEPCo) to impose power interruptions and distribute power in a ration in the capital Addis Ababa where there is reportedly a 40% power shortage.
Mugger in Oromiya and Mosebo in the Tigray Regional states are the largest factories accounting for the largest part of domestic production and supplying the growing local demands.
The ever increasing number of new industries as well as the expansion of investment activities in various parts of the country, coupled with low levels of rain during the main rainy season have worsen the situation.
Head of Land and Housing Development Coordination Bureau with the ministry, Amare Asgedom told a press conference that the two million quintal cement will be distributed for local consumption as part of efforts to ease inflation.
He said the government had allocated 44 million USD despite shortages in foreign currency.
According to Amare, government will import cement from Pakistan, Yemen and other countries with "best quality known as OPC 42.5.
It is also planned to distribute the cement with a rate of 250 birr per quintal.
The price for cement from Mugger and Mossebo had recently hit the 215 and 250 birr mark, respectively, before greedy merchants imposed a 120 birr increment since last week.
The cement factories have experienced shortages in the past five or so years as did the The Electric power corporation owing to expansion of industrialization, construction and investment in the country.
The massive construction project of condominium houses by the government is also a case in point.
Manager of Merchandise Wholesale and Import Enterprise (MWIE) Yimam Mohamod, who spoke along with Amare, said on his part his agency would distribute the imported cement in its 80 branches.
In addition, the enterprise will establish additional six braches in Kombolcha in the Amhara region, Adama, in the Oromia and Awassa in the S Yimam said EWDR had the experience of distributing cement and said it would sell over 200,000 quintals per month, a lot more than the combined production capacity per month of the Mugher and Mossebo cement factories.
In another related step, the ministry office also indicated that over 1000 cargo tracks are being imported to be deployed for transportation of the imported cement from ports to every distribution center.
But there is widespread fear that the market will be disturbed again and inflation will be ripe in the cement market as did other important items such as coffee, and food staff in the past, thanks to speculation and hoarding by traders and their accomplices, the so-called dallalas.
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