Are you suggesting that Dangote heats Limestone and Clay in Nigeria. A picture of his ovens and material handling equipments as well as the rest of his production line will be nice.
4.4 tonnes is capacity to hold stock, it does not necessarily confirm 100% local manufacture. These guys import cement in large quantities and Bag them up in Nigeria. Otherwise please post for us a Picture of Dangote's production line in Obajana. All he does is large capacity import and bagging.

I am not suggesting, that is indeed the case. 4.4m is NOT storage capacity, it is production capacity. He is producing cement daily at Obajana.

You want pictures?



[img]http://www.austroplan.at/images/stories/obajana_ref.jpg[/img]

During Construction

I think we have a faulty business logic/model in our country.

Locally made goods should be cheaper than imported goods, if for any reason they are not we should address the reasons why they not rather than banning others from doing business.
Banning imported goods can not be a roadmap to industrialization. If electricity is stiffling local production then  electricity should be sorted out.

Let the government focus on dealing with the problems, not playing to the gallery by suggesting additional importation will solve the problem. High cost of capital, transportation and logistics costs should be dealt with as these affect ALL cement production/importation activities.

The only justification for supporting folks like Dangote or Lafarge over small businesses are
1. if they are creating jobs more than the sum total of everyone else who can go into the business in a liberalised import policy

2. if they are able to manufacture the goods cheaper so that they are readily available and possibly available to export them.

If they are doing neither, to suggest that it makes any business sense or moral sense to put a possible 3000 small businesses out of work and make it more difficult for another 5 million Nigerians to build their homes (due to rising cost of cement) just because an Industrialist who possibly employs less than 200 people in his cement business needs to remain in business is ridiculous.

You are still living in an imaginary world - if the government has FAILED to provide simple transportation infrastructure, how can Dangote and Lafarge bring down the costs of cement??

You can't import through the ports to meet local demand, THERE IS NO CAPACITY! Even Petrol and Diesel importers are having issues, not to talk of adding cement to the mix. (no pun intended )

It is not okay to create an Employment and Housing Crisis just to oil Dangote's business.
That kind of Economics will not get any traction any where else in the World but Nigeria.

This is inverted reasoning - Was the a housing and employment crisis 'created' just now? Dangote started building his plant since 2005. . . why has the government not been able to get logistics and infrastructure sorted out yet?  

To even imply that this 'employment and housing crisis' is a recent phenomenon is nothing short of falsehood. Dangote's investments are precisely aimed at removing the bottlenecks to domestic supply.

I think we need to think carefully before we make commerce policies in Nigeria. For so long we have allowed the argument that "traders are undermining manufacturers" to fester. I reject that argument in its totallity because traders only import goods because there is a  market need for them. The reason there is a need for these goods is because there is no locally made cheaper alternative readily available. Otherwise traders would have been sourcing raw materials either locally or internationally.

This is not a Nigerian issue alone. Right now, the EU is imposing tariffs on US biodiesel to prevent foreign suppliers from destroying local producers. Restricting importation is always a legitimate strategy when national objectives are threatened.

We cannot simply continue to import with abandon and expect local alternatives to develop. Every region or country must balance it's current needs with long term goals. Yes we need cement now, but we also need to build plants locally. The current policy which states that only companies engaged in local manufacturing can import is the right one.

Furthermore, we CANNOT import our full cement requirements, it is not only a waste of forex, it is overloading the already overburdened ports. Focus on removing INTERNAL bottlenecks and then the solution will be achieved.

And surely hopes for immaginary Industrialization that never comes to past is not good enough reason to create an employment crisis or any kind of economic hardship, in terms of market cost of goods.

Again, what are the facts in the matter? UNICEM with 400,000 tonnes production has been established. Obajana with 4.4m tonnes production has been established. Lafarge is in the process of investing E350m to double it's production from Ewekoro from 2m tonnes to 4.2 million tonnes.

No employment crises have been created. Cement prices continue to rise due to the cost of transportation, storage and other logistical costs, not the base manufacturing cost.

The time has come to do away with this argument where we demonise legitimate Businessmen who are only seeking their own means of livelihood in a country where the Government refuses to live up to its promise.

No one is demonising importers. We have been importing since time immemorial, it has yet to improve things!

Please provide ANY evidence to show that cement importation will reduce prices. We have had people with licenses since DECEMBER 2008. . . this is JULY 2009 and prices are still RISING.

where is my post?

who is removing them

and for who?

,

@ OYB MEND

your post has not been removed, the spam bot has tagged it, so it is not displaying at the moment.

I even replied to your last post with pictures and all, but it was also tagged by the spam bot.

Pictures of Obajana:



[img]http://www.austroplan.at/images/stories/obajana_ref.jpg[/img]

During Construction

I need to [size=4pt]command[/size] tell this president what I also want done

See pictures in the previous post, and see the world bank summary below:

The Obajana Cement Project (OCP) involves the construction and operation of a greenfield cement plant at Obajana, Kogi State, 220 km southwest of Abuja, the Nigerian capital. The project will have a combined production capacity of 4.4 million metric tonnes per annum (mtpa) and includes a 135 MW captive gas power plant; a 94 km gas pipeline; a limestone quarry with associated 7.5 km conveyor belt; a 13m high dam impounding a reservoir with a total storage capacity of 5.1 million m3 and a 328 unit housing complex for non-local staff. The estimated project cost is $798 million, to be financed with sponsor's equity of $319 million (40% of the Project's capitalization) and $479million in form of long-term debt from local and international lenders. The Sponsor is Dangote Industries Ltd (“DIL”), a leading Nigerian manufacturing and trading company.

http://www.ifc.org/ifcext/spiwebsite1.nsf/0/327d28aaf0c4f24985256fea0079213c?OpenDocument

Shorten your posts so maybe they won't be tagged by the 'bot'

The Obajana Cement Project (OCP) involves the construction and operation of a greenfield cement plant at Obajana, Kogi State, 220 km southwest of Abuja, the Nigerian capital. The project will have a combined production capacity of 4.4 million metric tonnes per annum (mtpa) and includes a 135 MW captive gas power plant; a 94 km gas pipeline; a limestone quarry with associated 7.5 km conveyor belt; a 13m high dam impounding a reservoir with a total storage capacity of 5.1 million m3 and a 328 unit housing complex for non-local staff. The estimated project cost is $798 million, to be financed with sponsor's equity of $319 million (40% of the Project's capitalization) and $479million in form of long-term debt from local and international lenders. The Sponsor is Dangote Industries Ltd (“DIL”), a leading Nigerian manufacturing and trading company.

http://www.ifc.org/ifcext/spiwebsite1.nsf/0/327d28aaf0c4f24985256fea0079213c?OpenDocument

Debosky

The arguments you are making look good on the face value and probably conforms to textbook economics but they are not pragmnatic.

The most important foundation to any policy is "what is in the interest of the public good".

We both agree that Government needs to sort out infrastructure if we must develop and I hope they do that quickly, but where we dont agree is the notion that while they are yet to sort out these infrastructures or have not even put any meaningful programme in place to sort those issues out, it is ok to put forward policies which assumes that our infrastructures are perfectly ok.

While Europe have the moral right to pursue certain protectionist policies because they have tackled the macro issues like (roads, energy etc.) which allow small manufacturers to thrive, our Government has not. A lot of Nigerians who would have been small manufacturers are having to make do with merchandise.
When Europe protects its manufacturers and farmers with protectionist policies they are protecting a greater proportion of the society (and that is in the interest of the public good) but our own commercial landscape is totally different because are greater proportion are merchants and traders and hence when the same policies are applied in our own society it only amounts to monopoly and protecting the interest of a few over the many. That is unacceptable and only breeds an environment where crime and insecurity festers.

I agree that some of these protectionist policies can be implemented in Nigeria but they must be done with careful thinking and at the right time.

I am happy that you mentioned importation of petrol. If there is any industry we should practice protectionism it is in the oil and gas industry. For so many years We export crude, import gasoline and flair gas for nothing. Our government can not demand that Shell, BG, Mobil build refinery in Nigeria or at least build one themselves so that we will be exporting Gasoline, Bitumen, Polyproplene etc.
We can't even demand that these guys build a world class Research and Development Centre like they do in other parts of the world.
Rather our policy choice has been one which means that even the man in Olobiri village of Bayelsa (where crude was first discovered in Nigeria in the 1950's) will pay more for Gasoline if PM Putin decides to turn off the tap that supplies Gas to Europe. Our policy choice has been one which means that jobs which would have been created as a result of local refining are being lost. A policy which does nothing but favour those who import petrol like Otedola and Dangote.

So I find it very amazing that at this time in our National life it is perfectly ok to import Petrol  but not Textiles and Cement.
In the case of these too examples that I have given, Government has banned importation of these products, thereby either putting legitimate businessmen out of work or converting others to smugglers. The biggest tragedy is in TEXTILES. The so called local manufacturers can not manufacture some of these goods, and for where they can the cost of the final product is very expensive.

On both occassions our Government has wierdly made choices that guarantee that the final product for Nigerians are very expensive, remember we are talking about that country where almost 80% of the population live on less than $1 a day. The policies are also driving small businesses out of work

The only similarity between these two policy scenarios is that it is that which favours the big business moguls at the expense of the rest of us and the Nation's economy.

OYB_MEND:

So I find it very amazing that at this time in our National life it is perfectly ok to import Petrol  but not Textiles and Cement.

Are you joking? People ARE ALLOWED TO IMPORT CEMENT. The government licensed over 10 NEW COMPANIES [/b]LESS THAN A YEAR AGO!! [b]WHAT DIFFERENCE HAVE THEY MADE?

Importation can NEVER reduce CEMENT PRICES - get that straight. The problem is LOGISTICS. Import 1 billion tonnes of cement if you want - if LOGISTICS are wrong, prices remain HIGH. This low price by importing is nothing more than an empty promise made over and over again with no delivery.

PETROL IS BEING IMPORTED - IS IT CHEAP?? The only reason we are even getting 'cheap' petrol is a SUBSIDY by government! Stop mixing up issues in an attempt to make a point. There is LITTLE OR NO COMPARISON between petrol and cement.

All local production facilities are owned by the government and PRICE is controlled by the government.

How can that be compared to cement where the government owns NO PRODUCTION and doesn't set price?

In the case of these too examples that I have given, Government has banned importation of these products, thereby either putting legitimate businessmen out of work or converting others to smugglers. The biggest tragedy is in TEXTILES. The so called local manufacturers can not manufacture some of these goods, and for where they can the cost of the final product is very expensive.

The tragedy is that a government is so LAZY that it will encourage importers instead of fixing refineries and allowing producers who employ INFINITELY MORE people to flourish. Your over liberalised economic sense cannot bring benefits to Nigeria.

On both occassions our Government has wierdly made choices that guarantee that the final product for Nigerians are very expensive, remember we are talking about that country where almost 80% of the population live on less than $1 a day. The policies are also driving small businesses out of work

The government has not made right choices in all cases, but the cement case decision is right - WIDESPREAD IMPORTATION OF CEMENT DOES NOT LOWER PRICES. It has been tried and tested and doesn't work.

Textile manufacturers employ INFINITELY more people than the importers do - did you care to think about the PRODUCERS driven out of business by reckless importation and smuggling? Are those people less important than the importers?

The petrol issue is a separate matter - we cannot regulate prices and expect private production to grow, that is a FACT. Till we make up our minds, that segment will remain comatose.

By making right policies about cement, we have increased local capacity by over 6 million tonnes in 4 years, while NO INCREASE has happened in petrol due to wrong policies.

Again, all the importation in the world has not helped cement prices and will not.

so why is Dangote complaining?

Do you know how many people importing textiles? Do you also know that there are textiles that nobody manufactures in Nigeria and yet Government has put people out of business because there is an overall ban on all textiles?

If Logistic is the actual problem lets leave it open to competition, there is no need giving licences to people who have no interest in the business in the first place.

Government policies designed to favour a few where the rest of the country has no alternative is unacceptable in my view.

I hope Government allow more people who want to do the cement business to get involved.

There is no proof as at yet that Dangote or anyone manufactures locally. The drawing you produced is a construction site under development.
Lafarge is headquatered in UK and there is no reason to believe that their sites in Nigeria are not just dummy outpost to beat the system and engage in full blown merchandise.

Merchandise is not a criminal offense, but it beomes dodgy if Government begin to pick and choose who can trade and who can't.

Those importing are not more importatnt that those claiming to manufacture or vice versa. Hence Government should stop favouring one group over the other. None of the groups yet have any credible argument over the other.