First cement factory gets off the ground

THE long-awaited Cheetah Cement Factory, a multi-million-dollar project which should see Namibia produce its own cement for the first time, was launched at Otjiwarongo yesterday.

Great hype accompanied the event, with those involved promising the creation of approximately 250 direct and 2 000 indirect jobs for locals, while the limestone deposits at the farm Cleveland were projected to last about 40 years. The lifespan of the project was calculated using an expected production of 600 tonnes of cement a year.The project is a joint venture between the Otjiwarongo municipality, local company Whale Rock Cement, and Chinese investors Beijing Vibroflotation Engineering.The Chinese company recently joined the venture after previous investor Cimento Tupi (CP Cement), a Brazilian company, pulled out.Otjiwarongo mayor Otto Ipinge yesterday attributed the withdrawal of the Brazilian company to the length of time it took to acquire all the necessary approval for the venture to become a reality.Among the requirements were the completion of market research, a feasibility study, and an environmental impact study.The last of these was completed in June last year, Trade and Industry Minister Immanuel Ngatjizeko said.”Naturally we at the Ministry of Trade and Industry were very excited, but I must hasten to add that we were equally very cautious.Of course we had heard of ideas for a cement plant in Namibia from many different quarters many times over, but nothing tangible came through,” the Minister said, explaining Government’s strict stance towards the project.All involved expressed enthusiasm that the new factory would not only have a big impact locally, but that it would be Namibia’s opportunity to export a new product to neighbouring markets, Angola receiving special mention.The vice president of Beijing Vibroflotation Engineering, identified only as Mr Hou, requested during his speech that Government consider protecting the new factory from competition for a 10-year period at least, citing the vulnerability of the new factory.”You will agree with me, ladies and gentlemen, that while taking cognisance of the free-market system, increased competition in this field could cause harm to the viability of the business involved,” Hou said.”Considering the magnitude of the investment at hand, a humble request is made for Government to consider providing protection for a viable period of about 10 years to enable the company to regain losses incurred and return on investment,” Hou said.The total projected capital investment in the project was given as U$66 million.In 2005, Cheetah Cement started operation in Namibia by selling imported cement from Brazil, but faced heavy competition from South African veteran competitor Holcim, which was able to undercut Cheetah’s prices drastically.In October 2005 for example, Holcim reduced its price for a 50 kg bag of cement from N$54 to N$26.Cheetah MD Zedekias Gowaseb said that they were not in a position to drop their prices below N$30, and the company continues to face strong competition.The lifespan of the project was calculated using an expected production of 600 tonnes of cement a year.The project is a joint venture between the Otjiwarongo municipality, local company Whale Rock Cement, and Chinese investors Beijing Vibroflotation Engineering.The Chinese company recently joined the venture after previous investor Cimento Tupi (CP Cement), a Brazilian company, pulled out.Otjiwarongo mayor Otto Ipinge yesterday attributed the withdrawal of the Brazilian company to the length of time it took to acquire all the necessary approval for the venture to become a reality.Among the requirements were the completion of market research, a feasibility study, and an environmental impact study.The last of these was completed in June last year, Trade and Industry Minister Immanuel Ngatjizeko said.”Naturally we at the Ministry of Trade and Industry were very excited, but I must hasten to add that we were equally very cautious.Of course we had heard of ideas for a cement plant in Namibia from many different quarters many times over, but nothing tangible came through,” the Minister said, explaining Government’s strict stance towards the project.All involved expressed enthusiasm that the new factory would not only have a big impact locally, but that it would be Namibia’s opportunity to export a new product to neighbouring markets, Angola receiving special mention.The vice president of Beijing Vibroflotation Engineering, identified only as Mr Hou, requested during his speech that Government consider protecting the new factory from competition for a 10-year period at least, citing the vulnerability of the new factory.”You will agree with me, ladies and gentlemen, that while taking cognisance of the free-market system, increased competition in this field could cause harm to the viability of the business involved,” Hou said.”Considering the magnitude of the investment at hand, a humble request is made for Government to consider providing protection for a viable period of about 10 years to enable the company to regain losses incurred and return on investment,” Hou said.The total projected capital investment in the project was given as U$66 million.In 2005, Cheetah Cement started operation in Namibia by selling imported cement from Brazil, but faced heavy competition from South African veteran competitor Holcim, which was able to undercut Cheetah’s prices drastically.In October 2005 for example, Holcim reduced its price for a 50 kg bag of cement from N$54 to N$26.Cheetah MD Zedekias Gowaseb said that they were not in a position to drop their prices below N$30, and the company continues to face strong competition.