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DPP orders criminal probe into cement business

Saturday November 21 2020
Cement pic

Dar es Salaam regional commissioner, Aboubakar Kunenge addressing the press conference in Dar es Salaam yesterday, after visiting some of the cement stores at Kigamboni, where he addressed the dealers to sell cement at 15,000 shilling. PHOTO|THE CITIZEN CORRESPONDENT

By The Citizen Reporter

Dar es Salaam. The Director of Public Prosecutions (DPP), Mr Biswalo Mganga, has ordered a criminal investigation into the reported shortage of cement and other construction materials in the country.

Mr Mganga directed the Director of Criminal Investigations (DCI) and the Director General of the Prevention and Combating of Corruption Bureau (PCCB) to launch the probe into the cement production and distribution value chain.

The DPP gave the agencies 30 days within which to complete the investigation and report back with findings to enable his office to take appropriate action.

“Over the last one month I have noted a jump in the price of cement and other construction materials across different regions in the country. Circumstances around this matter point to an act of criminality in the entire production, transportation and marketing value chain, leading to higher prices, shortages or lack of these products in certain areas,” said Mr Mganga.

He said those found engaging in the malpractice will be charged and could face between 20 and 30 years in jail and confiscation of their products by the State.

The DPP said it was against the law and an act of economic sabotage for the dealers who will be found to have sabotaged or influenced any wheeler-dealings. He reminded that it was against The Economic and Organised Crime Control Act for traders to hoard products, sell them illegally and above normal price, manipulate or distort the market for a profiteering motive, including creating what he said was an artificial shortage of mass consumer products.

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Mr Biswalo’s intervention was the latest in attempts by the government to tackle the jump in cement prices and reported shortage of the product and related construction materials. The Fair Competition Commission confirmed a week ago that it was also investigating the same issue for any possible collusion.

Prime Minister Kassim Majaliwa also directed regional commissioners across the country to look into the problem and report back reasons why there has been a sudden jump in the price of cement. The newly sworn in premier said there had not been any justification for the hike in the prices.

The regional commissioners have in the last week been holding talks with cement producers and stockists in their areas while some have ordered market crackdowns to check the traders. However, there has been no immediate reflection in the availability of the product or a reduction of the cost as yet.

Reports suggest demand for industrial cement was unusually high as government implements mega construction projects across the country. Some factories have agreed to increase production to check the price increases by unscrupulous traders taking advantage.

The ministry of Trade and Industry was reported this week blaming the recent high cement prices on non-production by four main cement manufacturers in the country that had gone into maintenance.

There was a hue and cry from the public when a 50kg bag of cement retailing at Sh15,000 jumped by up to 30 percent. According to the National Bureau of Statistics data for October, 2020, the price for the same quantity had of cement had risen to Sh22,000 in parts of the country.

Permanent Secretary Riziki Shemdoe told The EastAfrican that “some cement manufacturers had stopped production for a short term programme, which then paved the way for thorough maintenance of machines, and this lead to stopping production for a while.”

This affected supply, which dropped to 150,000 tonnes for October, compared with 450,000 tonnes supplied to the market in the past two previous months. The four main cement manufacturers are Twiga Cement in Dar es Salaam, Tanga Cement, Mbeya Cement and Dangote Cement in Mtwara Region.

Twiga, the leading cement manufacturer with a capacity of 700,000 tonnes annually, is sagging under the demand, including by importers from neighbouring Rwanda and Burundi, which largely depend on Tanzanian cement.

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