Government now puts cement importation on hold, Tanzania

Government now puts cement importation on hold, Tanzania
07 January 2008

The government has put on hold plans to import cement from within East Africa designed as a strategy to ease an acute shortage of the item in the country.

It gave the ongoing post-election violence in neighbouring Kenya as the reason for the change of mind.

“The mission (cement importation) is currently next to impossible because of the chaos in Kenya.

The territorial border posts in East African countries can no longer be used as points through which to move the consignments of cement into Tanzania,” said Industries, Trade and Marketing minister Basil Mramba in an exclusive interview with this paper in Dar es Salaam late last week.

The government recently threatened to revoke cement importation permits issued to 23 companies for default, after most failed to deliver as stipulated in an agreement to that end.

The importation was intended to off-set the acute shortage at a time when the retail price per 50kg bag of cement had shot up from 12,000/- or thereabouts to at least 20,000/-, depending on where one was.

Failure by the firms to abide by the importation agreement forced the government to issue a 14-day ultimatum, threatening to revoke the licences of all those still defaulting thereafter.

``The entire plan has been thrown off balance by the political crisis in Kenya. There is no way it can be implemented under the prevailing conditions,`` explained the minister.

He added that the government had now ``refocused`` its strategy by encouraging private firms from outside the East African Community region to ship cement to Tanzania. Mramba said his ministry has started receiving applications for cement importation licences from some of those foreign companies, “but there is still room for more to enter the business”.

He noted that the ministry had so far issued an importation permit to only one such firm and that it is required to import 50,000 tonnes of cement within six months.

“The company had applied for a permit for 100,000 tonnes but we thought it made more sense if they started with half the amount to allow us time to check quality and standard of the product before allowing them to bring in more,” Mramba pointed out.

He said standard and quality were the most important criteria in the issuance of the import permits, adding: “All applicants must submit samples for the use in the verification of quality and standard before their applications are considered.”

The minister emphasized that the Tanzania Bureau of Standards was prepared and equipped adequately to scientifically verify the suitability of imported cement to prevent the penetration of one that is substandard and fake.

Although cement is still uncharacteristically scarce and expensive in many parts of the country, the government insists that the situation has improved steadily since remedial measures were taken. They include a ban on the rampant exportation of the item.

``The supply of cement has improved but, of course, not to a very satisfactory level. Unfortunately, the impact of the government’s intervention is yet to be fully appreciated by customers,” said a cement dealer in a Dar es Salaam suburb.

A number of construction experts interviewed recently affirmed that the scarcity of cement has adversely affected the building industry, with project implementation costs having risen astronomically.

The experts, among them civil engineers, warned that the country`s economy is likely to continue suffering following the shortage of cement or the likelihood of dishonest traders filtering into the country with substandard cement.

A weeklong survey of cement distribution and selling points in Dar es Salaam shows that the supply of the item has far from stabilised since it began falling a few months ago, prompting artificial shortages and spiralling prices.

Published under Cement News