FG to Cement manufacturers: Don’t inflict pain on Nigeria with forex

The Federal Government has told cement manufacturers to stop hiding behind Forex to inflict pain on Nigerians and, by extension, make housing delivery for the Nigerians difficult.

It accused cement manufacturers of hiding behind the unstable foreign exchange to inflict untold hardship on Nigerians, particularly those who are engaged in the construction and housing sectors.

The Minister of Housing and Urban Development, Hon. Ahmed Dangiwa, who led the meeting with manufacturers in an effort by the government to intervene and bring down the prices of cement from their soaring levels, threatened that the federal government could crash the prices by importing the product.

He noted that such action would, though providing temporary measures to the challenging prices of cement, in the long run, affect businesses for the manufacturers.

According to him, “the government stopped the importation of cement in order to empower you in order to make you produce more. Otherwise, if the government can open the borders for the mass importation of cement, the price will crash, but you have no business to do, and at the same time, the employment generation will go down.

“So these are the kinds of things for which you have to look at the efforts of the government in ensuring them.

Only recently have the prices of 50kg of cement soared to N13,000 across the country.

Dangiwa described the escalating cement prices as a crisis for housing delivery and the construction industry in Nigeria.

He said the situation was unacceptable and constituted an inimical trajectory for the growth of the country.

Dangiwa said the federal government cannot accept such illicit price hikes when all materials for cement production are locally sourced.

His words: “The gas supply that constitutes a chunk of cement manufacturers’ production costs is produced in Nigeria, but may not be enough. But some of the manufacturers will just go behind that and take advantage of it.

“We know that some of the key components of producing building materials, especially cement, are locally sourced, so the recurring disproportionate increase in the price of cement is unacceptable and unreasonable.

“Key input materials such as limestone, clay, silica sand, and gypsum within our borders should not be dollar-rated. You cannot continue to give excuses and blame it on dollars all the time.

“The worst part is that other building materials manufacturers take a cue from cement manufacturers, and once they see that you increase your price, they do the same as well. Recently, this is happening almost every week, and it has to stop,”  the Minister of Housing said.

Dangiwa further said “The mining equipment that we mentioned, you buy a mining equipment that can take years when you are using it; by the time you bought it, maybe it’s at a lower price, but because now the dollar is high, you say that you’re using that reason.

“Honestly speaking, we have to sit down and look at this critically and know how you should go back and think of it.

The Minister directed the Permanent Secretary, Dr. Marcus Ogunbiyi, to get the committee working to quickly come up with recommendations based on the issues raised by manufacturers so that they could be taken to the Federal Executive Council for action.

Lending his voice to the conversation to salvage the situation, Minister of State for Housing and Urban Development, Abdullahi Tijjani Gwarzo, called on the manufacturers to make some sacrifices in their operations.

He said that while it would be understandable that there are some challenges in the production of cement, the manufacturers must also know that they have a corporate social responsibility to stand by Nigeria during difficult times, and this is one such time.

Earlier, the Executive Secretary of the Cement Manufacturers Association of Nigeria (CMAN), James Salako, said the association does not have control over prices.

“In CMAN, we have a cardinal principle not to discuss price. We must not discuss it because of competition law. We are conscious of it. So when it comes to the issue of pricing, it is individual companies that have their policies,” he said.

Also, the Group Chief Commercial Officer at Dangote Industries, Rabiu Umar, expressed the readiness of the company to work with the government despite the identified challenges.

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