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Reps Demand Document On Cost Of Production From Cement Manufacturers

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…blame FCCPC for its laxity causing price increase 
 
By Gloria Ikibah 
 
The House of Representatives Joint Committee investigating the “Arbitrary Increase Of Cement Price In The Country” has requested for documents on cost of production from major manufacturers in the industry to justify the price of the commodity in the market.
 
The Committee criticised the Federal Competition Consumer Protection Commission (FCCPC) for its slackness and inefficiency which significantly contributed to the high cost of the commodity.
 
This was as the Group Managing Director (GMD) of Dangote Cement Company, Arvind Pathack, and Managing Director of Lafarge Cement, Ibrahim Aminu, were queried by the joint panel chaired by Rep. Jonathan Gaza on Friday.
 
“We want to make sure they bring the total documents we requested to ascertain their day to day production to be able to have a good idea of how much it actually costs to produce a bag of cement,” Gaza said.
 
The committee resolved to visit production plants of the companies after going through their books to ascertain the cost of production with a view to determine a fair price of cement for all Nigerians. 
 
The Chairman therefore assured that the efforts of the Committee would see the reduction of the price of cement for the benefit of Nigerians as soon as possible.
 
He said that the committee is interested in the cost of production from 2020 to date that justified the current price of cement which is over N10,000 in most parts of the country.
 
He said that the companies should give its average daily consumption of coal, gas, gypsum, limestone, clay, laterite and the average daily production of cement from 2020 to date.
 
Rep. Gaza said that the companies should provide details of all imported components for the production of cement and their prices from 2020 to date.
 
The lawmaker said that the companies should also provide details of local components for the production of cement, their prices in naira and dollars if any in the period under review and a summary of the monthly prices and quantity of cement produced from 2019 to date, as well as their audited accounts of the company, bills of laden and duties paid to customs within the period under review.  
 
Rep Gaza also said that the companies should provide details of tax waivers and other incentives enjoyed plus gas and explosives contract details.
 
The Committee also frowned at excuses of the high cost of foreign exchange by the companies as one of the reasons for the increasing price of cement.
 
The members of the Committee said this was not tenable as most of the materials for production of cement are sourced locally.
 
A member of the Committee, Rep. Dabo Ismail, said that Dangote Cement Company had continued to make increasing profits in the country despite being able to source most of its raw materials locally.
 
He said that in 2022, the company declared a profit of N524 billion, N553 billion in 2023 and have so far made N166.4 billion in 2024.
 
The lawmaker said that there was no reason why the price of cement will keep rising in the market to the detriment of Nigerians while producers are smiling to the banks. 
 
Earlier, the Group Managing Director (GMD) of Dangote Cement Company, Arvind Pathack said that 95 per cent of production cost are either imported or linked to foreign exchange.
 
He explained that there had been between 100 to 333 per cent increase in the price of major cement input materials like gas, AGO, gypsum, imported coal, spare parts, new trucks, tyres, petrol among others.
 
Pathack said that the company is made to pay for some of its contracts in dollars to access gas and explosives for production .
 
According to him, the provision made by the Central Bank of Nigeria (CBN) was not enough to meet demand so they engage in international sales also sourced from the parallel market.
 
Adding that logistics issues such as deplorable state of key roads, creates several issues including longer time to deliver, increase in truck maintenance and delivery cost.
 
The GMD explained that lack of sufficient forex to settle trade obligations had resulted in huge forex losses to a tone of N150 billion a per annum while paying 30 per cent interest rate on loans. 
 
He noted that between May 2023 and June 2024, there has been over 220 per cent devaluation of the Naira among many other challenges like insecurity and public power supply. 
 
Pathack said that the cost of building materials like reinforcement, granite and aluminium window had increased by 177 per cent to 283 per cent while cement had increased by 166 per cent between 2023 and 2024.
 
He said that cement was being sold at an average cost of 7,200 saying that any price over N10,000 was the handwork of retailers which the company had no control over.
 
According to him, when converted to dollars a bag of cement is said at $7.8 dollars in Benin, $6.6 in Togo, $7.8 in Ghana, $4.4 in India while that of Nigeria is $4.43, making it one of the cheapest in Africa.
 
The committee admonished the companies to look into their policy and operations with a view to reduce the price of cement in the country.
 
Rep. Gaza blamed high price of the commodity on the inaction of Federal Competition Consumer Protection Commission (FCCPC).
 
He said that as an agency responsible for the protection of consumers, they failed to protect Nigerians against middlemen who sold the commodity for as high as N14,000 after purchasing it for N6,000 at the factory.
 
“We are extremely hopeful that this engagement will lead to a reduction in the price of cement.
 
“FCCPC has slept on their functions so far, their inactivity and non responsiveness to price is what has put Nigeria where we are today,” he said.
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Just in: Plateau Govt Approves N70k Minimum Wage for Civil Servants

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By Kayode Sanni-Arewa

In line with discussions reached after consultation with relevant stakeholders, the Plateau State Government has approved immediate implementation of the N70, 000 minimum wage for the workforce in Plateau State.

The cheering news is contained in a Press Statement signed by the Head of Civil Service in the State, Stephen Pam Gadong.

Full text of the statement reads in part:

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Following the Agreement of the Committee on Consequential Adjustment on Salaries on 13th, November, 2024, the Executive Governor of Plateau State, His Excellency Barr. Caleb Mutfwang, has approved the immediate implementation of the N70,000 minimum wage for workers in the state.

The Implementation is a demonstration of the Governor’s commitment to prioritizing the wellbeing of the workforce in acknowledgement of their invaluableble role in driving the State’s developmental goals.

As the new wage policy is administered, Civil Servants are encouraged to embrace this gesture by recommitting to their duties with renewed dedication and zeal in order to foster a culture of productivity and excellence in service in the State.

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Before final liquidation, NDIC set to auction Heritage bank properties

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In a bid to ensure timely declaration of liquidation dividends to uninsured depositors of the failed Heritage Bank (In-Liquidation), the Nigeria Deposit Insurance Corporation (NDIC) has commenced the process of auctioning the landed properties and chattels of the defunct bank.

According to the Corporation, this exercise is in line with its statutory powers as the Liquidator of failed banks under section 62 (1)(d) of the NDIC Act, 2023, noting that; “This is another follow-up action sequel to the disposal of physical assets and chattels belonging to the defunct bank at its leased locations nationwide”.

This was contained in a statement signed by the Director, Communication and Public Affairs Department, Bashir A.

Therefore, the auction of the landed assets shall be by competitive bidding in sealed bids scheduled to take place at the six (6) selected locations of the Corporation across the country, for the affected 36 branches of the failed bank beginning from Wednesday 4th December 2024.
“Buyers who wish to participate in the auction are expected to follow laid down guidelines purposely aimed at ensuring transparency, fair competition, equity, and accountability to enable recovery of commensurate values from the exercise. This is critical for the payment of liquidation dividends to eligible claimants.

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The Corporation shall give preference to financial institutions who are willing to buy at the highest auctioned value to allow for the continuation of provision of banking services to the Nigerian public at the designated locations”, adding; “This is desirable towards bolstering financial inclusion as envisaged by the financial system regulatory authorities.

“However, Corporate bodies and Private individuals willing to compete are equally eligible to compete in the process without prejudice, the auction shall be open and competitive to all bidders.

Furthermore, bidders will be allowed to inspect the properties and chattels across all locations one week before the date of disposal.”

Importantly too, the statement said; “All interested parties are to make available 10% bid security of the value of their sealed bids to be dropped in the bid box provided at the specific centre out of the six locations of the Corporation as contained in the published advertisements.

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“All interested bidders are advised to submit their bids only at the designated NDIC offices covering their choices amongst Abuja, Lagos, Bauchi, Kano, Enugu, and Port Harcourt.”

Meanwhile, the Corporation has vowed that there would be no hiding place for debtors of the defunct Heritage Bank whose financial obligation portfolio is in the region of over N700 billion.

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Naira slumps in parallel market

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The Naira experienced a slight depreciation yesterday, slipping to N1,740 per dollar in the parallel market compared to its previous rate of N1,735 per dollar on Tuesday.

According to data from FMDQ, the indicative exchange rate for the Nigerian Autonomous Foreign Exchange Market (NAFEM) strengthened, rising to N1,645.4 per dollar from Tuesday’s rate of N1,689.88 per dollar. This marks an appreciation of N44.48 for the Naira.

The market also saw a significant increase in dollar trading activity, with turnover climbing by 122.5 percent to reach $236.84 million, up from $106.44 million the previous day.

As a result, the gap between the parallel market and the NAFEM exchange rate widened, now standing at N94.6 per dollar, up from N45.12 per dollar recorded on Tuesday.

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