Nigerian Government Frowns at Cement Manufacturers Amid Economic Challenges

Charles Ogba, Abuja.

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The Nigerian Government has said that cement manufacturers are not doing enough to stem the rising cost of cement in the country, stating that it will not accept a situation where the price of essential building materials like cement continues to rise uncontrollably.

 

The Minister of Housing and Urban Development, Arc. Ahmed Dandies stated this when he summoned cement manufacturers to a meeting at the Ministry headquarters in Abuja, Nigeria’s Capital.

 

Arc. Dangiwa expressed displeasure over the steady, recurring, and alarming increase in the prices of cement and other building materials, and accused the manufacturers of hiding behind unstable FOREX to inflict hardship on Nigerians.

 

He described the situation as unacceptable and inimical to the growth of the country, saying that the government cannot accept such illicit price hikes.

 

Dangiwa noted that the incessant hike has overtaken the country in the past few months, which has seen the price rise by over 100%, from N5,500 a few months ago to more than N10,000 today.

 

“This represents a 100 percent rise. And it is not only cement; we have also seen near-record high escalations in the prices of other building materials such as iron rods and other fittings. I recall that late last year, BUA Cement announced a commendable reduction in the price of cement from N5,500 to N3,500 per bag. I applauded the gesture, and several other stakeholders did too. But today, the reality is that of escalating cement price,” he said.

 

“An increase in essential building materials means an increase in the prices of houses. An increase in the cost of building houses means more and more Nigerians can no longer afford to own houses and provide decent shelter for themselves and their loved ones,” he noted.

 

Arc. Dangiwa charged the manufacturers to be honest in their dealings and desist from making life difficult for Nigerians.

“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,” he said.

“You cannot continue to give excuses and blame it on the dollar 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,” he further said.

 

He noted that rather than make Nigerians bear the brunt in their quest to make a profit in the face of slight macroeconomic headwinds, cement manufacturers need to be innovative and come up with a roadmap as part of the committee that has been set up to tackle the challenges for the benefit of Nigerians.

 

Speaking further, he said the unfortunate situation poses a threat to housing delivery which is the main focus of the Ministry, and a priority of the Bola Ahmed Tinubu administration.

 

“For example, if we were planning to build a one-bedroom apartment for about N8 million, it will now cost twice that much, about N16 million to build. If a Nigerian could afford to own a home of N8 million, it would now be impossible to do so. We are also aware of several persons who have had to suspend construction work because of this development”, he said.

 

He added that the Ministry is alarmed by the current situation, especially considering the projects the Ministry has embarked on to provide affordable and social housing delivery to low- and medium-income earners and vulnerable members of society.

 

“We have already awarded contracts for Renewed Hope Cities and Estates in 15 states of the Federation. There is also the PULAKU Initiative through which we intend to build at least 1,000 houses in seven (7) states affected by banditry. We are worried that the unreasonable rising cost of cement and other building materials in the country will affect these plans”, Dangiwa said.

 

He further directed the Permanent Secretary, Dr. Marcus Ogunbiyi, to get the committee working quickly and come up with recommendations based on the issues raised by manufacturers, so that they can be taken to the Federal Executive Council.

 

Also speaking, Minister of State for Housing and Urban Development, Abdullahi Tijjani Gwarzo, called on the manufacturers to make some sacrifices in their operations, understanding that they have a corporate social responsibility to stand by Nigeria in difficult times.

 

“This is not the time to focus too much on profit, but on our collective responsibility to the people of Nigeria. Cement manufacturers must realise that, as a government, we have options, but we would not want it to get to the point where we have to use those options because it may not be good for local producers. That is not to say we do not have options. As the Minister said, the Federal Government placed a ban on cement importation in a bid to empower you to flourish, but that cannot happen at the detriment of Nigerians,” he said.

In the meeting was the Group Chief Commercial Officer for Dangote Industries Limited, Rabiu Umar; Commercial Director for Lafarge Cement PLC, Gbenga Onimowo; and Secretary of the Cement Manufacturers Association of Nigeria (CMAN), James Salako, among other top officials of the represented cement companies.

 

Dominica Nwabufo