FINALLY, OTEDOLA BREAKS MONOPOLY WITH 2MILLION TONNES OF CEMENT

The persistent rise in the price of cement, an essential building material, may be heading for a reverse with the Federal Government approval granted Femi Otedola to import 2million tonnes of cement into the country.

The cement which a source close to the CEO of Zenon Oil and Gas said will soon land in Nigeria, is believed to be one of the Federal Government strategies to in the short run avail the Nigerian market cheap supply of cement.

“Of course, the Federal Government is aware of the fact that hitherto, the supply side of cement is controlled by a close knit community of suppliers who had turned cement supply into an open monopoly.” The source said.

“Though Federal Government had lifted the ban on importation of cement since January as part of the strategies to correct the shortfall in the supply of cement believed to be in the region of 11.5million tones, the efforts of the first batch of companies granted the right to import have not shown yet in the market. I think due to a combination of liquidity crunch in the nation’s financial sector and the global financial crises which have made access to credit a tasking process, most of these players might not have been able to bring in enough supplies of cement into the country. Naturally, the Federal Government had to make overtures to Mr. Otedola, who, they think has enough liquidity to break the strangle hold of the monopoly that cement supplies had turn.” The source revealed.

The source further added that the importation of cement by Otedola is going to be a continued process until the price of cement becomes affordable to the common man.

“This, I think, is going to be the first in the process to crash the price of cement. I am informed that the price of the first importation to be undertaken by Otedola should sell between N600 and N700, the calculation has been done. I think that after this consignment, others would be brought into the country until the price of a bag of cement becomes affordable to the average intending home owner.” The source added.

In response to a question on the impact of wholesale importation of cement to local cement manufacturing capacity, the source reasoned that the importation policy is an interim measure to assuage the difficulties in the building sector.

“I don’t think it is proper to allow Nigerians to wallow in the difficulty of unrealized dreams in real estate because local capacity has to be protected. Nobody is stopping the growth of local manufacturers, I know that government is encouraging that aspect of the sector by also opening up the space to intending manufacturers who are also given adequate incentive, the importation is an interim measure as I had said, to bring down price in the immediate.” The source submitted.