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Cement makers call for tough tax

By Vision Reporter

Added 17th August 2010 03:00 AM

Uganda cement makers have urged the five East African Community states to increase the common external tariff on imported cement. They said the country’s present cement output meets local demand.

Uganda cement makers have urged the five East African Community states to increase the common external tariff on imported cement. They said the country’s present cement output meets local demand.

By Emojong Osere

Uganda cement makers have urged the five East African Community states to increase the common external tariff on imported cement. They said the country’s present cement output meets local demand.

The manufacturers said the importation of cement, mainly from Asia and Egypt, was no longer necessary as industry players have invested sh2.2 trillion in the past year to produce the required cement and shoulder local demand.

This development comes on the heels of news that Tororo Cement’s new factory would be completed soon.

“We will complete the plant by March, 2011. It will have an estimated outflow of $20m (about sh44b). This would double the cement grinding capacity from one million to two million tonnes annually,” the company executive director, BM. Gagrani, said in an interview on Monday.

Gagrani said the project would have a new cement grinding mill and two storage silos of 10,000 tones and a packing plant.

When the new plant’s machines finally roar, the local cement industry manufacturing capacity will jump to close to three million tonnes a year, after Hima Cement opened its new factory that will raise production to 850,000 tonnes annually.

Gagrani said the plant’s kiln rehabilitation was also in progress and that the new investment of $30m (about sh66b) would increase clinker consumption to 1,000 tonnes per day, a 150% increase from the current 400 tonnes. He added that the firm was also undertaking measures to curb pollution.

“We have undertaken complete rehabilitation of our existing pollution control equipment,” he said.

“Although the equipment installations are not very old, productivity and effectiveness has reduced due to load-shedding and power fluctuations.”

The increase in local cement supply, analysts say, will be critical in determining the product’s end price.

Low cement production by local firms has always been blamed for the increase in the infiltration of cheap cement from mainly Asia and Egypt.

Cement manufacturers in Asia and Egypt enjoy low input costs, and export their surplus products mainly to Africa.

But the intense investment by local firms signifies imports may shrink since the local companies will have adequate capacity to meet demand.

“The cement industry in Uganda has bright future and can compete favourably with others in East Africa.”

Cement makers call for tough tax

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