Cement Manufacturers Association of Ghana (CMAG), led by its Executive Secretary, Rev. Dr George Dawson-Ahmoah, has lauded the government for placing a ban on permits for new cement companies.

According to the Association, it has always argued that opening up more new cement factories was not economically sustainable for competition but rather has the potential to encourage some manufacturers from compromising on product quality.

The Ministry of Trade and Industry has placed a ban on the issuance of permits to companies that want to set up new cement processing plants in the country. It said it is also taking steps to halt the importation of the cement products as part of measures to protect and encourage the growth of the existing eight cement processing companies in Ghana.

With the eight cement manufacturers, the country’s installed production capacity of the cement industry in Ghana is about 13 million tonnes per year as against an average consumption of about 6.4 million tonnes bringing a surplus capacity of about 6.6 million tonnes meaning only about half is being utilized. The cement industry is, therefore, producing under capacity.

Dr. Dawson-Ahmoah expressed worry that the installed capacities versus the consumption pattern clearly indicate a low utilisation rate by the local cement industry players, a situation that can lead to retrenchment of workers, a lower financial obligation to Government and the eventual folding up of most of the local industry.

As such the ban by Government, he reiterated, had come at the opportune time to salvage the industry from collapse.

On behalf of the association, he expressed gratitude to Government through the Ministry of Trade and Industry for curtailing the importation of finished bagged cement into the country.

He expressed optimism that the ban will also address unfair trade practices and deter manufacturers from compromising on product quality as they protect their investment.

He said the association is aware that cement forms an integral part of the economic growth of the country as such the ban will ensure that existing companies do not abuse pricing and standards but take adequate steps to expand its investment if the need arises in future.

The cement companies are Ghacem Limited (which has two factories), Diamond Cement Group (which has three factories), Supacem Cement, SOL Cement, Safe Cement, Dangote cement (bagging plant), Unicem Cement and Dzata Cement (bagging plant opening soon).