Trade and Industry Minister Kobina Tahir (K.T.) Hammond has insisted that introducing a Legislative Instrument to regulate the prices of cement in the country is in the interest of the general public.

Speaking at a press conference in Parliament, he explained that cement prices consistently see an upward adjustment adding that despite several conversations manufacturers failed to put a cap on price increases.

“Somehow something has to be done about this, I think it behoves those in responsible positions to ensure the good people of Ghana are not fleeced.

"I am not comfortable, I don't believe that we are getting good prices for all that is worth. I think there is something fundamentally wrong with the pricing of cement in the country,” K.T. Hammond said.

“You have a kind of arbitrariness in the pricing of cement. It's been so haphazard, I strongly believe that there must be some sanity in the system,” the Trade Minister added.

He assured that a regulated price will not be forced on manufacturers but rather through a collaborative discussion with a selected committee and cement producers.

As such, through this L.I a committee set up would discuss all the nitty gritty including the cost of production, profit margin, cedi depreciation and others to arrive at a price point, he said.

K.T. Hammond believes that this will push cement manufacturers to be transparent with the needed information to help create a price ceiling beneficial to them and the consumers.

Background

In May 2024, the Minister for Trade and Industry, K.T. Hammond instructed the Cement Manufacturing Development Committee (CMDC) to direct cement manufacturing companies in Ghana to immediately reverse the hike in price increase.

However, the Cement Manufacturers Association (CMA) rejected this directive citing production costs and the principles of a free market economy, stating that the directive is "without basis and justification" and has refused to comply.

• Read also: We don’t need L.I. to regulate price; resolve depreciation – Cement manufacturers tell K.T. Hammond

On June 25, the Trade Minister presented to Parliament an L.I dubbed 'The Ghana Standard Authority Pricing of Cement Regulations 2024' to gain legal backing. But he faced fierce opposition in Parliament.

The NDC MPs demanded that the legislative instrument (LI) go through pre-laying procedures before being formally laid on the floor.

 the Chamber of Cement Manufacturers presented a petition to Parliament registering their outright rejection of the proposed L.I.

COCMAG called on the house to decline the proposal explaining that it was presented without any prior consultation with the key stakeholders in the cement industry, including the manufacturers.

Presenting the proposal without the needed consultations undermines the principles of fairness, transparency, and inclusive decision-making, they indicated.

• Read also: We don’t need L.I. to regulate price; resolve depreciation – Cement manufacturers tell K.T. Hammond

However, the Trade Minister dismissed calls by cement manufacturers for stakeholder discussions before the proposed legislative instrument was placed before Parliament.

Speaking on JoyNews’ PM Express, Kobina Tahir Hammond said that although the manufacturers were not consulted during the drafting of the L.I., he had consistently had conversations with them on the need to be transparent about pricing.

He told the host, Evans Mensah, that he had pushed for the cement manufacturers to self-regulate their pricing to ensure prices were not shooting over the roof, however, his call was not heeded.

• Read More: I didn’t have to consult cement manufacturers to get L.I through – K.T. Hammond

“I didn't have to consult them in drafting the L.I., I warned them consistently that they couldn't do what they’re doing [raising prices]. I consulted with them several times in my office, I told them what I wanted. I wanted them to be transparent, there to a reduction, I wanted us to understand the basis and the publication."

The L.I

Meanwhile, manufacturers of cement products could be liable to up to three years in jail if they flout certain provisions of the Legislative Instrument (L.I.) being proposed by Trade Minister, K.T Hammond.

Speaking on Newsnight, Evans Mensah indicated the document "sets what they call a maximum allowable retail price for cement, so call it a price ceiling beyond which no manufacturer can sell a bag of cement," he told Emefa Apawu.

Evans Mensah explained that the proposed legislation "is actually proposing stiff penalties for all manufacturers who violate the terms of the L.I. including up to three years in imprisonment."

• Read More: Cement manufacturers could face 3 years in jail per proposed L.I

The document spells out who specifically suffers the penalty if the regulations are flouted.

"It talks about the fact that in the case of a body corporate, every director and Officer of that body corporate is deemed to have committed that offence.

"In other words, if you violate this and you sell above the price ceiling, the directors of the company, the officers of that body corporate will be thrown into jail if indeed you're found guilty up to three years in jail."

"And then he says in case of a firm, or partnership, every partner of the firm or partnership or any other person concerned with the management of the firm is deemed to have committed that offence."