AGI lauds Trade Ministry over cement regulations

The Association of Ghana Industries (AGI) has lauded the initiative of the Ministry of Trade and Industry to restrict the importation of cement into the country.

The association described the initiative as a bold one that was designed to regulate the cement sector.

In an interview with the Daily Graphic, the Chief Executive of the association, Mr Seth Twum Akwaboah, said any effort to protect the local industry was good and should be supported.

“It is a position in the right direction because the local industry has the excess capacity to produce cement”, he said.

Legislative Instrument

The Ministry of Trade and Industry in March proposed, through a legislative instrument, to impose a ceiling on the annual importation of cement into Ghana. Companies that wish to import bagged cement shall be issued a permit to avoid the chaos that has lately saddled the sector.

The Minister of Trade and Industry, Mr Ekwow Spio-Garbrah, who conveyed the decision to restrict imports in a statement, also instructed all cement importers in the country to apply for permits.

However, companies legitimately licensed under the ECOWAS Trade Liberalisation Scheme were exempted from applying for permits.

That, the AGI said, was a welcome development that would ensure that the right Cost, Insurance and Freight (CIF) could be determined to avoid the cement war that had affected GHACEM and other cement manufacturers, on one hand, and the Ghana Revenue Authority (GRA), on the other, over the accurate values of the imports.

Local manufacturing companies

That, he said, would also protect the local manufacturing companies to create employment and regulate the sector to monitor importers.

The directive is also expected to ensure that the cement that is imported into the country is of a standard quality that would protect the construction industry.

With these directives in place, analysts say Africa's leading cement manufacturer, Dangote Company, and other cement importers are in for tougher times in Ghana, following plans by the government to restrict cement imports into the country.

To this end, Mr Spio-Garbrah, has proposed to Parliament, the enactment of a legislation "to propose a ceiling on the annual importation of cement into Ghana."

Production capacity

Current imports into the country are above one million tonnes of cement per annum. That figure, according to the minister, had aggravated the glut in the industry, thus the need for the curtailment of cement imports.

Cement importers, according to the minister, had up to March 31, 2016, to register with the Ministry of Trade and Industry, but added that "companies that are legitimately licensed under the ECOWAS Trade Liberalisation Scheme are exempted from the need to apply for permits."

Government’s intervention

In recent months, there have been agitations from local cement manufacturers for government's intervention to prevent the collapse of their companies.

Specifically, Diamond Cement Company at Aflao has, in recent months, protested against the importation of already bagged Dangote Cement from Nigeria. In one of such protests, some youths in the community had appealed to President John Mahama to intervene.

They demanded that Dangote should expand his factory in the country to create more employment instead of endangering the existing jobs in the industry by importing already bagged cement.