26 February 2013

Tanzania: Govt Accepts Cement Imports

Dar es Salaam — The government here has said that it could not put trade barriers on imported cement as it was requested by cement companies because local production is still insufficient.

Tanzania's Minister for Industry, Trade and Marketing, Dr Abdallah Kigoda said despite the expected progress from cement industries, the government will still allow importation of cement until local producers meet domestic demand.

Kigoda admitted that although imported cement is sold at a lower price compared to locally produced cement, it should stand as an eye opener for local industries to become competitive.

Tanzania has three cement factories which are Tanga Cement, Mbeya Cement and Twiga Cement, all of which are operational, while four others are in the final construction stages.

The country's cement production capacity stands at 3.25 m tonnes a year while the actual demand is almost 4 m tonnes per year.

"In order to control importation of more cement, local factories had to increase production to meet the demand as the country was surrounded by potential market opportunities such as Southern Africa Development Community (SADC) and the East Africa Community (EAC)," he said.

Minister Kigoda clarified that the government was aware of the challenges facing local industries, such as unreliable power, but added that it was taking measures to stabilize the situation.

He mentioned another challenge as high distribution costs caused by poor infrastructure, noting that the government was working to improve railway transport.

The Board Chairperson of Heidelberg Cement Company which operated as Twiga Cement in Tanzania, Jean Junon was recently quoted in a local media as saying that the cement industry is still facing a number of challenges, including massive importation of subsidized cement.

Junon said that the upgrading of kiln 3 would help to expand production.

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