ZIMBABWE’S use of multiple currencies is fuelling an influx of foreign manufactured cement which is chocking local producers, a Pretoria Portland Cement (PPC) official has said. Nqobile Bhebhe Chief Reporter
PPC managing director Njombo Lekula told journalists during a tour of the company’s plant in Bulawayo on Wednesday that Pakistani cement manufacturers were now making inroads into the country.
“Cement manufactures in Pakistani are now supplying their products here through the sea,” he said.
“Their advantage is that they have export incentives from their government.
“The Pakistani cement is coming through the sea into Mozambique and some of it ends up in Mutare.
“The key factor is our use of the US dollar. Malawi uses Kwacha, Zambia (Kwacha), South Africa has the rand, Mozambique uses the metical and in Zimbabwe we have the US dollar.
“So the dollar is what the foreign suppliers are after and we have it.”
Lekula said the quality of the Pakistani cement “does fall under international standards, but ours is of high quality”.
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“Quality is what we pride ourselves in,” he said.
Lekula said the cost of production for the cement industry in Zimbabwe remained too high compared to their competitors.
“The strengthening of the US dollar when compared to other currencies poses a real challenge,” he said.
“Most of our input costs remain dollar-based, be it Zesa (electricity) or labour.
“We need to be careful on what is allowed through the border and the impact thereof to the job market in the country.”
In August, the International Trade Administration Commission (Itac) launched investigations into claims by cement producers that cement from Pakistan was being dumped in the Southern African Customs Union.
Afrisam, Lafarge, NPC Cimpor and PPC alleged that bagged cement from Pakistan was dumped at a 48% lower price than is the normal value in Pakistan.
Apart from cement from Pakistan, products from Botswana and South Africa are also posing a threat to Zimbabwean producers.
“The picture is not good at all, South Africa has brought 1,3 million tonnes as at last year and the current situation, with a Nigerian plant coming into place in South Africa, they are putting into the market another 1,5 million tonnes,” Lekula said.
He said other neighbouring countries were also setting up mega cement plants and due to over capacity, they would push their products towards Zimbabwe.
“The story does not end the there, what is going to happen is that we are prone to foreign goods flooding our market,” Lekula added.
