Calabar — As a way of forcing down the price of cement in Nigeria, the federal government has softened several investment conditions. This has led to the renewed interest by different cement firms. One of such is the United Cement Company (UNICEM) with headquarters in Calabar. Its executive director, Javier De Benito flew in from France last week to participate in the company's annual safety week where he spoke to Weekly Trust. He bared his mind on Nigeria's cement industry and agrees that the industry is maturing, hence they are pushing their initial investment to $3 billion. Excerpts:
What is your assessment of the cement industry in Nigeria?
The cement industry in Nigeria is growing. I can say that the Nigeria's economy is also growing. There are lots of people now investing in the cement industry. There are Dangote, Larfarge, Nigercem and they are active in the industry. We are therefore investing not only funds but deep interest in order to keep our share of the market.
How are you doing this?
We are going to improve our investment by between two to three billion dollars in the next few years as a way of sustaining our leadership in the Nigerian market. This is a lot of money which requires serious commitment by Unicem. As we are very committed to our investment in Nigeria, we also need the Nigerian authorities to make the atmosphere more conducive for us. We have renewed strategies to keep up our investment. We are not taking anything for granted. Despite this, we have distribution issues such as poor roads infrastructure which hamper our trucks from travelling to selling points at distant places. Even if we are doing our best, we need support of the authorities in this area.
But your company ought to start something...
We have already started by building a 22km road. And this is not very common. We should have this kind of infrastructure provided. Despite that, Nigeria is an oil producing company yet there is also the high cost of energy which is impacting against our investment. And this eventually impacts against the cost of cement in the country, which people complain against. We do not actually care about high prices or building this high cost of gas into the final cost of our cement products. But we need to have margins in order to help us pay back our loans and to reinvest.
What kind of support are you talking about?
The authorities should look into these factors of public infrastructure and high cost of gas. On this journey to maturity we have to make sure that we consider all issues. On our part, we intend to further move up our market and investments in Nigeria. That is why we had to graduate from one product to two, so that every customer should have satisfaction and array of choices from our company. That is why, too, we have just launched another 42.5 cement product, and other products will soon come up. But it is not going to be a mass product yet, as all will target at customer specifics. We have different types of products for different applications. On the way to maturity, Unicem is very happy to be in the cement industry in Nigeria.
Unicem has just launched the second cement line in the Greenfield Mfamosing plant. When are you commencing operation and how much will it cost your company?
The second line project is ongoing. We have offers from suppliers, financial institutions in Nigeria. We are pumping in over five hundred million dollars ($500 million) for the second line project. We are still working on some administrative issues. The board and shareholders are very alive to this second line cement project.
Last year, Unicem was able to achieve 70 per cent safety compliance according to the report submitted by external safety auditors. This year, it has proposed to achieve 85 percent. How does your board hope to achieve this tall ambition?
We see that as a big achievement indeed which we hope to consolidate upon. On behalf of the board, I congratulate Unicem team for this feat. To illustrate our resolve, we have three board members representing the shareholders of the company that participated in this year's Safety Week celebration. This is one other way of showing our deep regard for safety.
What's the main reason behind the annual celebration of Unicem Safety Week?
Celebration of Safety Week by Unicem has become a model for us. It is because of our deep concern for safety that we are consistently devoting a whole week to marking it. We do not want to pass or emphasise this message of safety only to our group but to generality of the populace and cement industries in Nigeria and the world; that, it is important for all to think and emphasis on safety in their daily and official endeavours. We are celebrating Safety Week as a serious objective, and we intend that our employees should cultivate the habit of thinking 'safety first'.