Works Minister, Dave Umahi, Is Creating Demand And Supply Chaos—Cement Producers Association

Works Minister

OpenLife Nigeria reports that the newly sworn in Minister of Works, Engineer Dave Umahi has been accused of creating chaos in the demand and supply curve of the cement industry through unworkable policies by the association of cement manufacturers of Nigeria.

In a statement jointly signed by the National Chairman, Prince David Iweta and National Secretary Chief Reagan Ufomba, on Sunday, the association commended the works Minister’s position on cement-made roads but warned of dire consequences, if the supply end is not addressed properly.

The Association warned that the ongoing plan of the federal government to introduce concrete roads will raise the price of cement to N9, 000 per bag from the current price of N5, 000.

It called on the current administration to permanently address the perennial cement price hike problem by facilitating larger participation in the cement industry, noting that Nigerians have no business buying cement for more than N5, 600 per bag.

As a solution, the cement producers urged the government to lay more emphasis on road design that allows both cement technology and asphalt pavement to run concurrently and provide ample time for a smooth transition that allows contractors to invest in commensurate and requisite equipment and retooling.

The statement read, “Our findings from various parts of the country show that cement sells for as high as N6000 per bag in the rainy season.

Our prediction is that it will sell for over N9,000 per bag in the dry season, especially with the pronouncement of the Honourable Minister of Works on cement technology and the marching order on housing by Mr President if the government does not take proactive steps.

“While we commend the Honourable Minister’s position on cement-made roads, we warn of the dire consequences if the supply end is not properly addressed. In fact, it would amount to dereliction of duty not to intervene. And the time is now.

To do otherwise is to continue in a worsening pipe dream that prices would suddenly drop on this essential input that will continue to drain the purse of Nigerians, render them homeless, encourage chaos between demand and supply, and worsen the infrastructure deficit it sets out to cure, and lead to an unprecedented price hike.

“We also call on the Honourable Minister of Works to lay more emphasis on the design criteria of roads that allow both cement technology and Asphalt pavement to run concurrently, in turn, will provide ample time for a smooth transition that allows contractors to invest in commensurate and requisite equipment and retooling.

We must also as a nation regulate static and dynamic load traffic by introducing weighbridges at access points on our highways.

Working in sync with contractors, and allied Ministries of Trade and Investment, Transport, Environment and Finance on realistic policy on cement is most desirable at this critical time.”

The association further requested the government to conclude the backward integration policy of the late Yar’adua administration that was already bringing availability and affordability of cement in the country.

It added, “There has been so much comment on cement and cement pricing of late. What our nation needs is cement that is available and affordable.

And this cannot be achieved by mere wishes, faulty policies and programmes, without breaking the chain of monopoly and favouritisms. Nigerians are tired of waiting for a downturn in the price of cement and for decent and affordable housing.

“We call on the Tinubu government to permanently solve this perennial cement price hike problem by expanding participation in the sector with companies who have verifiable evidence of local investment, including greenfield licenses and quarrying.

As a matter of fact, we call on the government to more specifically conclude the backward integration policy of the late Yar’adua administration which was already bearing availability and affordability fruits.

“As patriots, it is our view that the government reintroduces backward integration policy and the conclusion of old ones.

Consequently, the government cannot be seen to approbate and reprobate by deregulating issues of petroleum products and foreign exchange on one hand and regulating on pricing of cement, essential goods and services on another. There is a need for policy harmonisation and convergence between fiscal and monetary policies.

“Finally, we call on the government to urgently intervene in the foreign exchange market, intervene in restructuring bad loans of manufacturers, and review palliative modules.

The cry for elusive FDI will be drastically reduced if all manufacturing concerns are revived. The government must be decisive in the kind of economic policies it intends to foist on the people,” the statement concluded.