Hima Cement has opened a new cement plant at their factory in Kasese district along Fort Portal road. President Yoweri Museveni commissioned the plant during his campaign tour of the Rwenzori sub-region last Friday.
Hima invested $120m in the new plant, which will double the factory’s production capacity from 350,000 tons per annum to 850,000 tons. The factory already produces 500,000 bags of cement everyday.
Hussein Mansi, chairman of Hima Cement, said the increase in production will save Uganda $1bn in foreign exchange spent importing cement from Kenya, China and the Middle East as well has help the country earn extra revenue from cement exports to emerging markets in the great lakes region.
He told Museveni that in spite of the investment, the industry is still faced with challenges from high electricity and transport costs which make its final product more expensive.
It costs five times more to transport a ton of cement in East Africa than to China and the Middle East and Asia. Electricity for production is three times the cost in China and the Middle East.
Mansi wants government to protect the company against imports by reinstating the Common External Tariff for cement to ensure fair competition. Already Kenya and Tanzania have agreed to reinstate CET.
“We are confident that if we have a similar cost base, the local industry will compete effectively with imports. The belief in government’s commitment to creating a competitive environment has resulted in local manufacturers investing in increasing capacity,” Mansi said.
While addressing workers after opening the factory, Museveni said it is wiser to make such an investment that creates over 500 jobs than use the land for agriculture.
“The future is not just in agriculture. $140m from 20 acres of land is almost half the money we get from coffee in the whole of Uganda. Therefore, industrialisation is the future of Uganda,” Museveni said.
Museveni said government will complete the Kamwenge-Dura-Rwimi road to ease transportation of cement to Kampala and across the borders to Kenya and Tanzania. The Dura-Rwimi section shortens the Fort Portal roundtrip by 100km. Museveni said the railway line will also be constructed to reduce further on transport costs.
“You need roads, we are going to work on them. The Common External Tariff, I am going to take this one up with the East African presidents. The electricity costs, you don’t have to worry about that because from next year, electricity costs will go down because Bujagali will be finished,” Museveni promised.
Hima cement is a subsidiary of Bamburi Cement and a member of the Lafarge group from France.