The Minister of Trade, Industry, Private Sector Development and PSI, Mr Alan Kyerematen, has stated that the government may be compelled to impose price control on cement if the current escalating price regime of the commodity is not halted or reversed.
He said the government was not happy with the current hikes in the price of cement, which had attracted public concern and criticism.
The price of cement ranges from ¢85,000 to ¢100,000 per bag in the various regions of the country.
Mr Kyerematen gave the warning at a stakeholders meeting on the escalating price of cement in Accra yesterday.
It was attended by officials of Ghacem Limited and Diamond Cement Ghana Limited (both producers of cement), distributors of cement, representatives of the Ghana National Chamber of Commerce and Industry and the Ghana Union of Traders Association (GUTA).
Mr Kyerematen said cement was an important national commodity which has significant impact on the economy.
Therefore, he said, the government “has the right to protect the national interest and consumers” and added that “the government will not sit down unconcerned with the price of cement escalating and people taking advantage of the crisis situation”.
“Within the next couple of weeks, if the prices of cement are not brought down, the government has no option but to enforce some controls to regulate the price of cement,” he stressed.
Mr Kyerematen said the consideration to impose price regulation on cement did not mean that the government wanted to reverse its policy of allowing a free economy in the country.
He said cement was a “strategic product” in the nation, and this required the adoption of stringent measures to mitigate the effect of its escalating price on the country's economy.
He noted that the introduction of price control on cement would bring about “black market” in the system, and warned that the government would deal drastically with those who illegally manipulate the price and supply of the product.
Mr Kyerematen asked stakeholders in the cement industry, including producers, distributors and retailers, to co-operate with the government, as well as balance their interests, “to protect the national interest”.
He reminded them that as the Minister of Trade and Industry, he had the responsibility to balance the interest of industry and traders and that of consumers.
Mr Kyerematen asked Ghacem to increase its production capacity to meet the current demands in the country.
He asked the management of Ghacem and Diamond Cement to establish plants to extract the rich limestone in various parts of the country for the production of clinker (a material used in the manufacture of cement).
There are 3.5 million tonnes of limestone deposits at Nauli in the Western Region, 400 million tonnes at Oterkpolu in the Eastern Region and eight to 10 million tonnes at Buipe in the Northern Region.
Mr Kyerematen said the government would consider getting investments and cement importers to cater for future needs of the country if the two companies could not increase their production capacity and bring down the price of cement.
He gave the assurance that the government would consider reducing taxes and tariffs on imported raw materials for cement production, but said that would not ensure price reduction if cement producers did not intend to bring down the prices.
The Strategy and Corporate Affairs Director of Ghacem, Dr George Dawson-Ahmoah, and the Managing Director of Diamond Cement, Mr D. Prasad, attributed the shortage of the product to the current energy crisis.
Dr Dawson-Ahmoah said Ghacem still sold cement at ¢59,225 to distributors, but the distributors increased the price based on freight and other charges.
He said the Volta River Authority (VRA) and the Electricity Company of Ghana (ECG) had mandated Ghacem to cut electricity consumption by 25 per cent.
He said Ghacem had since bought a 5.1-megawatt generator to make up for the 25 per cent production capacity.
Mr Prasad and Dr Dawson-Ahmoah indicated their resolve to establish plants to extract limestone for the production of clinker when they found adequate deposits of clinker in the country.
The two plants of Ghacem in Tema and Takoradi have production capacity of 2.4 million tonnes per annum but Ghacem produced 1.7 million tonnes last year.
Diamond Cement has a capacity of 1.1 million tonnes per annum and currently produces at full capacity.
The President of the Ghana National Chamber of Commerce and Industry, Mr W. A. Krofah, asked the Ministry of Trade, Industry, Private Sector Development and PSI to monitor the production and distribution of cement in the wake of escalating price of the commodity in the country.
He stressed the need for the country to take a critical look at the supply and demand of the commodity and consider the possibility of encouraging more people to import it into the country.
Story By Musah Yahaya Jafaru