Some of the key facts emerging at the World Economic Forum in January were: Africa’s population is projected to grow to 2 billion by 2050; the continent has a US$2 trillion economy with about a third of its 54 countries seeing annual GDP growth of more than 6%; of the top ten fastest growing economies in the world, six are in Africa.
In April of this year, Nigeria finally completed a rebasing of its GDP data to confirm that the continent’s top oil-producing nation had overtaken South Africa to become Africa’s largest economy in terms of its GDP size. One important African business leader who has seen his country’s economy expanding by an average of 7% per annum over the past decade is, of course, Aliko Dangote. Dangote Cement has been the driving force of the country’s cement industry, as you can see across pages 24 to 50.
Not all the cement in Nigeria is produced in Dangote’s plants. Lafarge Cement Wapco plc has said it plans to invest an additional €1 billion over the next three to five years on expanding its plants in Calabar and Ashaka. Lafarge is also reported to be looking at investing about US$20 million in the refurbishment of its existing plant in Zimbabwe, increasing production capacity by 20%. Demand for cement is expected to increase in the medium to long-term as a result of an infrastructure backlog of approximately US$14 billion.
The Dangote Group has said it plans to complete ongoing projects in Zambia, Tanzania, South Africa, Republic of Congo and Gabon this year, adding some 13.5 million tpa to the Group’s existing capacity. Also in Zambia, Lafarge is constructing the first cement depot in Chipata district in Eastern province. There is growing demand for cement in East Africa due to rapid infrastructure development. At present, the region imports some 50% of its cement.
A report from Business Monitor International predicts that Ghana will benefit from significant investment over the next five years as the government increases efforts to address transport, housing and utility shortages. Half of the country’s 25 million inhabitants now live in urban areas and suburban sprawl has subsumed towns near the major cities. CIMAF announced that it will invest €60 million in a 1 million tpa cement plant in Tema.
Bloomberg reports that Saudi billionaire Mohammed al-Amoudi, the biggest investor in Ethiopia, plans to build two more plants in the Horn of Africa. These will add to the existing facility at Derba Midroc. The country’s economy is projected to expand 7.5% this year. The Development Bank of Ethiopia (DBE) has signed a loan agreement with Habesha Cement for US$33 million towards the construction of a 1.4 million tpa plant at Holeta, Oramia state.
In South Africa, Sephaku Cement began operating its Delmas grinding plant in January. PPC is expanding into other areas of Africa, investing US$230 million in building a 1 million tpa plant in the Democratic Republic of Congo (DRC) in partnership with Habesha Cement, and it has plants under construction in Ethiopia, Zimbabwe and Rwanda. Meanwhile in Mali, Ciments de l’Afrique is establishing a 500 000 tpa cement grinding plant that will process imported clinker from Morocco.
In North Africa, revenues from oil and gas resources and energy exports have allowed the government in Algeria to assign US$286 billion for investment in infrastructure over the next five years. Demand for cement is particularly high, currently running at 21 million tpa against a domestic production figure of about 18 million t. The deficit has to be imported. The Minister of Industrial Development and National Production, Amara Benyounes, is quoted as saying that cement imports will cease by 2017. New plants are planned for the northern province of Relizane and the southern provinces of Bechar, Adrar and Tamanrasset. Work is due to begin shortly on a new 2.2 million tpa cement plant in the region of Maghra (M’sila). Algerian private company Hodna Cement and its South African partner PPC have signed an investment agreement for the project, which is expected to be completed in June 2016.
For the past three years, economic growth in Egypt averaged 2% pa, inflation was in double digits and the unemployment rate went from 9% in 2010 to over 13% in 2013. Online media reports suggest that the main reason for the economic disarray is the failure of previous governments to develop an economic plan. The administration that gained power in August 2013 has committed itself to tackling the energy and input shortages that have seriously constrained industrial production. Last year, as the country faced a fuel crisis, some plants saw a drop of almost 20% in production. The alternative is for cement plants to switch to coal, but this comes up against the minister for environmental affairs and NGOs who support ‘Egyptians Against Coal’. As this debate continues, the Suez Cement Group (Italcementi) inaugurated its first waste treatment plant in February 2014. The project uses 45 000 tpa of household waste to produce 35 000 tpa of alternative fuel.
Market conditions in Morocco are poor. Holcim’s Dominique Drouet is reported as saying that there was a 12% drop in activity in the cement industry at the end of December 2013 and the decline is expected to continue this year. Ciments du Maroc, however, plans to open a new plant in Tetouan, while Lafarge Ciments is pursuing a project to install a new plant in Taroudant. The Awka Group plans to open its first facility in Sidi Bibi near Agadir, but Ynna Asment has delayed opening its first plant.
Read the article online at: https://www.worldcement.com/africa-middle-east/30062014/cement_global_viewpoint_africa_425/