Siphakeme .Mnindwa
Nqobile Tshili, nqobile.tshili@chronicle.co.zw
ZIMBABWE is losing approximately US$50 million due to cement imports, which have claimed 25 percent of the market — stifling the growth of the sector.
PPC Zimbabwe Limited managing director, Mr Albert Sigei, revealed this on Wednesday during a factory tour in Bulawayo by Presidential Affairs and Devolution Permanent Secretary, Engineer Tafadzwa Muguti.
While local companies are invested and contribute to economic development, imports are blamed for contributing to the externalisation of foreign currency.
“In fact, imports have no value addition that they bring to the country. We expect to have imports of about 400 000 tonnes in a year. Because of that lack of value addition, we estimate that the Government directly loses more than US$50 million dollars in a year of foreign currency due to imports,” said Mr Sigei.
“Specifically, imports now take about 25 percent of the country’s demands. This has seen a decline in sales volumes on our products. So, this is one of the challenges that we are experiencing as the cement industry.”
He said the company is engaging the various arms of the Government to address the problem. PPC is the country’s biggest producer of cement and controls the market share.
Mr Sigei commended the Government for initiating the anti-smuggling campaign saying it was crucial in protecting local producers.
He said PPC Zimbabwe remains rooted in the country’s development agenda and forecasts positive growth to the economy.
“PPC Zimbabwe is a solid contributor to the development of Zimbabwe. We are a solid partner to the journey of achieving 2030 goals. On an annual basis, we support more than half of the country’s demands. Secondly, we are an integral part of the society by offering jobs as we employ close to 700 people permanently and contractors and indirectly even more,” said Mr Sigei.
“We are a major tax payer, we are a very big company as you know.”
He said the persistent power cuts and an expensive electricity tariff are some of the challenges the company is grappling with and to address them, it is in the process of setting up two power plants.
Mr Sigei said they were also having challenges in the transportation of the stock with the country’s railway company being unreliable.
He said the inflationary environment has also affected their operations, especially as they are accepting all currencies.
In his remarks, Eng Muguti said there is a need to protect local companies, especially considering the socio-economic impact they have in the country.
“As Government, I think there has to be a balance, in as much as we are doing import substitution but we also have to preserve the jobs. The task for provincial economies is to ensure that Zimbabwe comes first. This company employs about 1 000 people including those in the haulage sector,” he said.
“Our trip made us understand that our imports are now taking 25 percent of the market share. For example, this plant can produce 1,4 million metric tonnes and in the last quarter, they have realised a 10 percent decline in sales,” said Eng Muguti.
He said under the Second Republic, the Government wants to increase exports through imports substitution and there is a need to strike a balance to ensure local companies are protected.
Eng Muguti said there is also a need to revitalise the National Railways of Zimbabwe for smooth and efficient logistics.
“One of the things that touched us is that the Government needs to increase our capacitation of NRZ because this company alone is spending US$30 million on logistics. It is directly benefitting our haulage companies but it has a huge effect on us as a country in terms of the maintenance of our roads,” said Eng Muguti.
He said it was pleasing that PPC Zimbabwe is investing on a 30 megawatt to improve its power access. — @nqotshili
safari-extension://6775D447-2E3C-425F-8641-6FC882CB1C8C/dist/ginger.safariextension/content/popups/definitionPopup/index.html?title=Zimbabwe&description=country%20in%20southern%20Africa
