Two cement producers in Mauritius have hit at the decision of Mauritian authorities to reintroduce price controls on cement – denouncing that they were neither consulted nor officially informed of the move.
“The decision to control the price of cement is very regrettable when stakeholders that are most affected had already entered into urgent discussions for a transparent price review,” Cementis Mauritius was cited as saying in the local media.
This “unilateral and arbitrary decision”, it added, takes the industry back 20 years.
“It impacts not only the company, but the entire supply chain, including transporters, hardware stores, contractors, subcontractors and other service providers in the sector.”
In Mauritius a 25kg bag of cement will now cost between Rs158-175 (US$3.39-3.76), depending on the location on the island, following an amendment to the Consumer Protection Regulation (Control of Price of Taxable and Non-Taxable Goods) 1998 legislation. The act allows the Ministry of Commerce to determine the maximum selling price for cement to prevent any potential increase affecting consumers, according to Le Mauricien.
Taken by surprise
Kolos followed suit, deploring that it was “taken by surprise and is concerned by this decision”.
“The new maximum prices have created a situation of inequality, unfairness and discrimination between the two cement suppliers in the Mauritian market, in as much as different maximum prices have been set for each company. This will distort the competitive dynamics of the market,” Kolos said in a statement published on the Stock Exchange of Mauritius.
Immediately upon becoming aware of the Ministry’s Communique, the company said it reached out to the Ministry and other stakeholders “to fully apprise them of the competitive, commercial, financial and other implications resulting not only from maximum prices having been imposed but also from unfair and discriminatory discrepancies in the set of prices.”
Moving forward, Kolos warned that it will “ensure that the company takes appropriate actions as it may be advised in fulfilling its duties and responsibilities towards all its stakeholders, namely its shareholders, employees, business partners and the general public.”
In addition, the State Trading Corporation, the government’s procurement arm, is also considering ways to intervene in the cement market in which, it is claimed, there is currently a lack of competition. A study is also underway, considering supply from several countries.
Sources: Defi Media, Stock Exchange of Mauritius, Le Mauricien
