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Government to Resolve Problems before Domestic Cement Manufacturers by this Weekend

Government to Resolve Problems before Domestic Cement Manufacturers by this Weekend

This information was unveiled at a special briefing that domestic cement manufacturers held on August 20 with the aim to draw public attention to their problems. They introduced specific visions to Prime Minister Mamuka Bakhtadze for resolving the relevant issues and noted that without the mentioned visions, plants would close and they would have to apply any legal protest to defend the labor rights.

During the news conference the domestic cement manufacturers received a notification from the Prime Minister’s administration that the Prime Minister would clarify the situation  and tackle the issue by this weekend.

The Prime minister’s response turned out satisfactory for the cement manufacturers. They decided to postpone the protest rally scheduled for August 22 for at least one week.

The situation on the market worsens at high paces, the domestic cement manufacturers note. Because of unclear reasons,  imported raw material – clinker, which is a key component in cement production, cannot leave the customs house under the pretext of  quality control. The most part of plants have suspended operation because of frustration in supply of raw materials. 2-3 plants have the reserves of only several days and after that these plants will also have to suspend operation.

„The examination process lasts for at least 28 days. As a  result, importers’ transports have to stay idle (wagons, trucks) and pay significant fines. This is serious burden on them and they find useless to continue operation. As a result, cement plants remain without raw materials. As a result, these plants have to suspend operation and more than 700 citizens may lose job places”, the statement by domestic cement manufacturers reads.

They completely depend on imported raw materials, because the only manufacturer of clinker HeidelbergCement cannot, at this stage, produce raw materials necessary for production of high-quality cement, they said.

Giant HeidelbergCement produces cement by its own clinker and controls 80% of the market, while the remaining 20% is shared by 20 small plants and employment of more than 700 workers depends on a continuous supply of imported clinker”, the statement reads.

“The problem arose about a month ago and both manufacturers and clinker importer companies try to draw the attention of decision-making structures to this issue. We have somehow fulfilled this mission, but without results. Namely, the Prime minister has answered our statement, the Business Ombudsman has assumed mediation with state structures. we have achieved a micro result.  Namely, the cargo at customs houses and on the road were admitted to the market without inspection, as an exception case. however, this process was suspended soon”, the cement manufacturers said.

The market requires clear decisions and regulations, they said.

“These decisions cannot wait. They cannot be delayed. Their development process cannot last endlessly for an uncertain period. Otherwise, we will receive clear signal that we cannot continue operation…

Therefore, we apply to the Prime minister Mamuka Bakhtadze to tackle this problem as soon as possible on behalf of all parties.

Here we introduce our position for the problem resolution.

Namely: the following measures should be carried out to maintain domestic cement production and continuous operation of the sector:

  • customs clearance from invoice is necessary for clinker, which is necessary component in cement production. This decision will cheapen the prime cost of final product and its selling price.
  • Clinker quality inspection practice for 28 days should be removed. Raw materials imports should not be frustrated under the pretext of quality control… It is nonsense of examine clinker quality, because clinker quality standards do not exist and both high-quality and low-quality cement may be manufactured from the same clinker.

quality control should be tightened on cement and similar measures should be taken in relation to all manufactures and importers without exceptions.

As to imported cement, growth of which frustrates domestic production stability and development, in this case the government should carry out the following measures: imported cement should pass customs clearance from triple amount of market value (about 200 GEL per ton),that is from 600 GEL. As a result, the market will receive high-quality domestic product”, the statement reads.

Domestic manufacturers urged the Prime minister to resolve the issue ultimately through August 21.

“If the Government fails to tackle the mentioned problems within reasonable period, we will have to resort to legal protest forms. First of all, more than 700 employees from our plants will gather in front of State Chancellery jointly with their family members on August 22 and we will try to draw the Prime minister’s attention to our just demands”, the statement reads.