Govt asks cement industry to review profit margins

Govt asks cement industry to review profit margins
Published: 29 August 2006

The government has called on the Tanzania Portland Cement Company Limited (TPCC) and the cement industry in general to review its profit margins so as to enable more customers buy the firm’s cement product.

The Minister for Industry, Trade and Marketing, Nazir Karamagi, made the call on Thursday in Dar es Salaam during a gala dinner dedicated to 40th anniversary of the cement producing company.

”Local consumers complain about high prices of cement products. This is because of the low purchasing power of our people, which leads to the low per capita consumption of 37kg per annum as against 56kg in Kenya and 400kg in South Africa,” he said.

He said that it is high time that TPCC ensured that cement is available at a cheaper price so that majority of people could afford to build modern houses.

”The major constraint in Tanzania’s competitive platform has been on how to ensure the provision of cheap and reliable energy, which is a vital input in manufacturing sector, especially in the cement industry.

I recognize the initiatives and efforts undertaken by TPCC in looking for alternative sources of energy. The company has been using tyres and cashew nut shells in the kiln partly as a substitute to the expensive Heavy Furnace Oil (HFO),” he said.

On his part, the TPCC Managing Director, Klaus Hvassing, said that his company would find out some ways to see that consumers get quality and cheap cement.” But the company is also determined to eradicate the problem of underweight, which is caused by underhand traders who reduce the weight of cement bags.