End coal import ban, Bunge team tells govt
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The committee’s chairperson, Mr Stanslaus Nyongo (Maswa East-CCM), told Parliament that local production of coal does not meet demand, especially the needs of cement manufacturers.
Dodoma. Parliament’s Industry, Trade and Environment Committee yesterday asked the government to lift its ban on coal importation.
The committee’s chairperson, Mr Stanslaus Nyongo (Maswa East-CCM), told Parliament that local production of coal does not meet demand, especially the needs of cement manufacturers.
Presenting the committee’s response to the Ministry of Industry, Trade and Investment’s 2017/18 budget estimates, Mr Nyongo noted that as the government strives to boost local production of coal by attracting investment in the area, it should allow manufacturers to import the commodity.
“Apart from low production of coal, manufacturers are facing a major challenge in transporting the commodity from Ruvuma Region to their plants. The roads around the coal mine are in a bad state and are impassable during the rainy season. The nearby railway can’t handle heavy loads. Currently, coal amounts to 70 per cent of the entire production cost of cement.
“The government should allow the importation of coal so that manufactures using it as a source of energy in the production of cement are not bogged down during this transition period,” he said.
The government banned the importation of coal from abroad, mainly South Africa, stating that there are adequate local stocks of the commodity. Coal is currently mined in Ngaka, Ruvuma Region, by a partly state-owned company, Tancoal.
However, cement manufacturers have for a long time been complaining about the ability of Tancoal to meet domestic demand.
An independent report commissioned by the government in 2015 vindicated manufacturers’ claims about Tancoal’s low capacity.
In his maiden tour of southern regions in March, President John Magufuli took a swipe at Tancoal and directed that Dangote Cement Company be given a plot to mine its own coal.
However, while cement manufacturers welcomed Dr Magufuli’s observation that Tancoal had no capacity to meet local demand, some firms argued that awarding a mining licence to Dangote alone was not the solution to the wider coal production problem.
