NAIROBI, Kenya Jun 25 – Bamburi Cement Limited wants the government to step in and cushion the country against a rising influx of cheap cement into the country.
Bamburi Managing Director Hussein Mansi said on Wednesday that the tax waiver on imported cement was creating unfair competition in the Kenyan market, which if unchecked would lead to the closure of some companies that cannot match the competition.
“Some of the East African countries are under attack from importation of cheap cement and we can never match it because we have fixed costs that are not calculated in the importation calculation,” he stressed.
Mr Mansi said the current economic crisis should not be used to subject the industry to imports at a lower cost.
“Last year if you wanted to import cement it was not less than $300. So let’s not look for one year when there is an international economic crisis and say this is the price of cement,” Mr Mansi said.
At the same time Mr Mansi indicated that the new 480,000-tonne capacity Uganda plant is expected to start operations in the second quarter of next year.
The expansion is meant to boost the company’s ability to meet the demand in the region and open up export markets especially in Central Africa.
With growing demand for cement in Kenya, the company expects consumption to grow by 12 percent given the growing demand for houses and roads in the region.
“Growth in developing countries development is driven by individuals because of residential constructions. That is why in emerging markets there will always be a lot of demand for cement,” he said.
In an effort of building a capacity to meet demand when the need arises, the company is in the process of prospecting new limestone mines.
Bamburi Cement is currently involved in a court case over the use of the Mutomo limestone mines which was to provide a large amount of the raw material needed for manufacturing. The case pits Bamburi with rival company Athi River Mining Company.
Mr Mansi was speaking during a ceremony celebrating the company’s safety month.
The company currently invests close to Sh100 million each year, since 2006, towards safety improvements.
Mr Mansi said: “When you spend less time worrying about the safety of your employees, you get better production output hence the reason we invest heavily in this area.”