Europe / Middle East / Africa
Dangote Cement factory implantation impasse persists
May, 04 2012
(Cameroon) -- Despite the government’s ongoing efforts to draw in venture capitalists, Cameroon’s time-honored repute as a dangerous investment destination is proving hard to shake off. Doubting Thomases only have to make reference to the stalemate presently engulfing the planned implantation of the Dangote Cement factory in Douala to amend their perception.
Following a 2008 government invitation, Nigerian multibillionaire, Aliko Dangote finally inked an agreement to set up a second cement-producing company in the country in September 2011. During the foundation-stone laying ceremony the same month, the company officials unveiled plans to invest 57.5 billion FCFA [about US$ 115 million] in the project with an earmarked one-million-ton yearly production capacity.
Based on satisfactory placement surveys ordered by the investor, the government via the Ports Authority of Douala endorsed the choice of Base Elf on the flanks of the Wouri River to seat the factory. The agreement also accorded Dangote Cement Cameroon Ing. a 30-year-renewable lease on the site. In fact, the same venue played host to the September 2011 foundation-stone laying ritual.
But in February, and amid ongoing equipment installation in prelude to the actual start of production, indigenous Sawa traditional chiefs forced the venture to a standstill. They denounced the “unilateral arrogation of their land by the government and the Nigerian investor,” claiming sacrilege considering the site serves as the venue for the Ngondo, the annual traditional and cultural festival of the coastal Sawa people.
Elsewhere, environmentalists backed by local media condemned the decision to install the company “in the heart of the city.” Many cited looming public health hazards and multiform damages to the environment.
Eventually, the lobby paid off as the Douala Urban Council ordered the temporal suspension of the factory implantation works. Ever since, intense negotiations between several government ministers, the chest-pounding Sawa chiefs as well as officials of the Douala port and Dangote Cement have failed to clear the hurdles. While the ethnic chiefs want the project relocated, Dangote officials say they are not backing off an inch from the site.
In late April, and amid the blazing controversy, Dangote emissaries met with PM Philemon Yang to slate their worries over the protracting stalemate. They voiced confidence the project will move ahead in due course despite media rumors it had been shelved, and that Dangote was preparing to lodge a damage-seeking lawsuit against the government an arbitration court in London for non-respect of contract arrangements.
The company envoys also said they were scandalized that a missive addressed to the Prime Minister on April 25 and bearing details of their discussions with various parties for the project to be re-launched was leaked to the media only a day later. Electing anonymity, they argued it was a significant pointer to the fact that several ill-intentioned officials are working backstage to impede the project.
They also waved off allegations the project would be abandoned, denying claims they were planning to drag the government to court. However, it remains unclear when the works on the Base Elf site will resume. A high-stakes meeting between Aliko Dangote and President Paul Biya has been announced in the coming weeks and it is expected that only thereafter will the current impasse be broken.
Meantime, Dangote Cement Cameroon Ing has been touted by government officials as a big remedy for Cameroon’s inadequate cement supplies. The country’s lone cement manufacturing company CIMENCAM claims a current output of 1.6 million tons from two factories in Douala and Figuil in the north, far below demand estimated at 4 million tons and growing at an 8 percent annual rate.
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