Will Cement Price Come Down After $350m BUA Investment?
The cost of cement in Nigeria has left many low income earners with no option than to remain in rented apartments throughout their years of labour.
The clamour for the price to come down has continue and now the Vice President, Professor Yemi Osinbajo, has joined the campaign.
The high cost of this commodity has also reflected in the nature of roads in Nigeria. There are no concrete roads any more, as construction companies reduce cost by not using enough cement.
On Tuesday, the Vice President inaugurated a $350 million BUA Cement Plant at Kalambaina, Sokoto State.
The News Agency of Nigeria reports that the 1.5 million metric tonnes per annum cement plant built by BUA Group, would provide at least 2,000 direct and 10,000 indirect jobs in Nigeria.
Osinbajo said two things that required attention in the cement industry was price and embracing usage of cement for constructing concrete roads across Nigeria.
“The price of cement surely can be cheaper. I know the standard arguments such as power, transportation and other challenges, but it is still a lucrative business,” he said.
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The Vice President urged BUA Group to collaborate with other major cement manufacturers toward achieving reduced cement price to drive infrastructure development.
'Where We Ought To Be'
Osinbajo noted that the inauguration of the plant was a milestone not only for BUA Group, but for the cement industry and the nation’s economy.
“It will consolidate Nigeria’s self sufficiency in cement production, and boost our status as a net exporter of cement. The significance of these cannot be over emphasised as we explore opportunities to diversify the country’s earnings away from oil,” he said.
According to him, after so many years of inadequate attention to national infrastructural development, the next few years will be defining for infrastructural development.
He said that the National Integrated Infrastructure Master Plan estimates that an investment of about three trillion dollars was required to bridge the nation’s infrastructure gap.
This, according to him, will also increase infrastructure assets from the current level of about 35 per cent of Gross Domestic Product (GDP) to at least 70% by 2050.
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“To be where we ought to be in infrastructural development, investment in construction materials is crucial. Cement is of course literally the building blocks for much of the infrastructure that we need in Nigeria from houses to bridges, roads and dams to mention a few,” he said.
Osinbajo noted that Nigeria presently produces more than 40 million tonnes of cement annually, and more cement than any other country in Africa.
“Nigeria’s huge market of high urbanisation rate of 3.5 per cent and even now a low per capital cement consumption of about 125kg and an estimated housing deficit of 17 million, are key drivers for the growth of the Nigerian cement industry in the medium term,” he said.
AbdulSamad Rabiu, the Chief Executive Officer (CEO), BUA Group, said that the project would not have been realistic without Federal Government’s efforts to initiate deliberate policies that support key industries in the real sector, from agriculture to manufacturing.
He noted that through some of the policies, the Central Bank of Nigeria (CBN) provided adequate foreign exchange for import of machinery, which was helpful in completing the project on schedule.
“The construction of this plant started three years ago when we engaged SINOMA at the height of the foreign exchange crisis.
“Despite what was termed by some to be harsh economic conditions in the months after signing the contract, we pushed on with steely resolve and a firm belief in the value of this project,” he said.
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