COCMAG warns government that Ghana's cement industry could collapse

The Chamber of Cement Manufacturers, Ghana (COCMAG) has given the goverment a stark warning that various taxes and levies over the past two years are driving the cement industry towards collapse.

According to the Executive Secretary, Reverand Dr George Dawson-Ahmoah, the most recent tax imposed on cement manufacturers is the fumigation levy of US$0.50/t on imported clinker by the Ministry of Health.

"How on earth can a raw material such as clinker be fumigated before clearance from the port? We are calling for the immediate abolishing of this levy," said Dr Dawson-Ahmoah.

"My members are not happy at all because besides this levy there's still the VAT restructuring levy of five per cent and the two per cent special tax which has been in existence for the past three years. There are several others including a proposed increase in certification license/surveillance from Ghana Standards Authority etc. All these affect production costs in the production of cement culminating in uncompetitiveness."

Another issue raised by members was the increasing number of cement factories in Ghana. "Already the existing manufacturers have a combined utilisation rate of about 45 per cent, an indication that there's a total adequate cement capacity in Ghana," noted Dr Dawson-Ahmoah.

There are nine cement factories in the country, plus one bagging plant, with a total installed capacity of about 11.6Mta. The average consumption is about 6.3Mta bringing a surplus of about 5.3Mta. "So why do we need more cement factories?" asked Dr Dawson-Ahmoah.