International cement producers accused of unfair business practice
The Botswana Cement Manufacturers Association (BCMA) is concerned by the amount of cement dumping by regional and international industry players who do not add value to the local economy, through skills development CSI, local value chains and employment.
“The local cement industry is under threat from regional and international counterparts that are dumping the cement products, the predatory pricing is the main threat to the local industry,” said BCMA Chairman Nkosi Mwaba.
He said these regional and international counterparts are eroding the local market due to the low pricing strategy they come with, adding the northern part of the country is mostly dominated by foreign cement products which suppress local cement players.
“The argument has always been that local cement manufacturers play a vital role in the local economy by creating employment and the usage of local raw materials,” said Mwaba.
Mwaba said on the other hand, regional and international cement manufactures dump their cement products in local retail outlets and sell them at a very low price which he termed unfair competition as these producers do not even create value in the local economy.
Mwaba further mentioned that the association is working closely with the Ministry of Investment Trade and Industry in ensuring that there are policies that will create fair gameplay in the market.
He, however, mentioned that it would only be fair if cement prices are regulated and also have some privileges for local cement manufacturing players since they play a huge part in the country’s economy.
Local cement producer, Matsiloje Portland Cement, who shut down due to related issues also expressed discontent on how the industry needs protection from relevant policymakers to ensure that local players are protected and that there is fair trade in the industry.
“When we were in operation we constantly reduced prices until we reached a point where we felt that it was not sustainable to continue running the business. We had hoped that the business environment would change for the better, but things did not go as we had anticipated,” previously mentioned Racjit Josh the Matsiloje Portland Cement (MPC) plant Managing Director.
“Zimbabwe, Nambia and SA have measures (import restrictions) in place to protect their market while Botswana does not have,” said Josh.
Another local cement manufacturer that has been vocal about this issue is PPC which has expressed concern that imported cement dumping drives local manufacturing companies out of business.
“It is critical to ensure local players; local manufactures are prioritized for national projects to project a strong economic boom. The value chains that support this are huge for the continent and individual nation-states,” said PPC South Africa MD, Njomobo Lekula, further highlighting that predatory pricing can be managed through tariffs so the ground is level.