Paying Double The World Price: Dangote Cements Nigerians In Poverty NewsRescue- The going price for a 50kg bag of cement in Nigeria is anywhere between N1,650.00 and N1,800.00. That corresponds to $10-11. At this rate, Nigerians pay at least double the cost of the same size bag of cement in most nations around the world. Samuel Awoyinfa writing for the Punch this March, captioned this, ‘Cement price still defies laws of demand and supply.’ It does. In his article, he compared costs to the amount paid for the same product in neighboring Ghana and Benin republic. In Republic of Benin and Ghana, a bag of 50kg of cement sells for 4500CFA (N1,500) and GH¢15.295 (N1,150) respectively. That equals $6 and $9/bag. But the disparity in price is even much worse when other countries are compared globally. In the United States, this quantity of cement sells between $5 and $6.00 Bags-of-CementIn India, the 50kg bag cost hiked from RS215 to RS315, that is between $3.40-5.00. It only recently increased in cost. In South African Rands, the bag sells for an equivalent of $6.50. In Kenya, the 50kg bag of cement sells for 450 Kenyan shillings, that’s about $5.00 We can go on and on. The median price of this raw material is about $5 worldwide. Nigerians pay double. One asks why if Nigeria manufactures this product, the price should be double the cost around the world. It is expected that by manufacturing, Nigerians should have an advantage and possibly pay less than the price of the product in other countries, or at least equal. Cement is a commodity that is almost always manufactured and utilized locally. 97% of cement is manufactured locally around the world from glue and limestone. Hence the difference in rate is not related to importation costs or other such factors. Gladly though, Nigerians only recently started paying just double after new government regulations. Prior to 2011, Nigerians paid about N2700 for the same 50kg bag of cement. That is three times the global average. With the rate of constructions developing Nigeria is churning out, one sees that only a single man benefits from this exorbitant price. This is Aliko Dangote. The man who became a billionaire and the world’s 40th richest man courtesy of his monopoly policies in Nigeria. Dangote manufactures Dangote cement. With his friends in the government, Dangote, Nigeria’s president sponsor, who literally finances and imposes most recent leaders on the nation, benefits from various sole production and importation rights. As Samuel Awoyinfa commented, the demand and supply just does not add up. Without competition in the market, there is frank exploitation bordering on robbery. Stealing from the poor. Every Nigerian who builds a house pays Dangote and his cronies in the government, almost double for each cement bag. The impact of this in houses not built, built to sub-standards and infrastructure Nigeria fails to have is enormous.
Posted on: Mon, 30 Sep 2013 06:58:32 +0000
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