Local cement producers call for level playing field

Local cement producers have called upon the government to put in place measures that will ensure adequate payment of import duties and taxes on imported cement to check influx of substandard imported goods.

Speaking to members of the Parliamentary Committee on Economic Affairs, Industry and Trade, the TPCC Managing Director, Pascal Lesoinne who also doubles as the Chairman of East Africa Cement Producers Association (EACPA), said the vice if not checked would lead to a complete collapse of local companies.

“Many Tanzanian cement companies are currently facing stiff competition from imported cement especially from Pakistan. Worse still is that subsidies provided by exporting countries allow dumping of surplus cement into the Tanzanian market.

“Importers of cement are utilising loopholes in import and customs systems by under declaring and paying between 5-10 per cent of import duty costing the country up to 25 billion shillings. The critical point for us is levelling of the playing field so we can compete favourably,” he said.

He added that Tanzania does not need imported cement since there are many players to meet the country’s demand.

Lesoinne during the occasion also decried fluctuation of electricity that has raised the company’s operation costs as the company has to spend up to $ 2 million per month to ensure steady supply of electricity at the firm.

“The biggest challenge affecting our production is insufficient power supply. To ensure that our customers don’t suffer from interrupted supply, we have to pay up to US$ 2million every month in running generators.

He said the company that currently produces 1.3 million tons of cement per annum will be able to produce up to 2 million tons per annum after commissioning its new plant in October, next year.

He, however, cleared allegation that cement firms fix prices of the products saying this is baseless as cement companies compete favourably.

“The issue of fixing prices does not completely exist. We are direct competitors so each company would like to enjoy the market leader status,” he added.

The Kigoma South Constituency Member of Parliament, David Kafulila expressed concern on the unfair competition into the market urging relevant authorities to investigate deep into the matter. “This is a very serious matter.

We as a committee cannot allow this to prevail as the vice directly impacts the country’s economic development process,” he said.

The Director of Industries in the Ministry of Industry and Trade, Eliness Sikazwe during the occasion said the Minister for Industry and Trade, Dr Abdallah Kigoda has already formed a seven member to investigate alleged subsidies, tax evasion and the quality of cement imported.

“The committee has already been formed to investigate the matter and we expect the committee to handover a detailed report once the process is complete, which will be presented to the council of ministers for further discussion,” Sikazwe added.
Source: Daily News, reported from Dar es Salaam, Tanzania
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