The Sun News On-line

Nigerian property developers may soon heave a sigh of relief as Dangote Group and Sunoma, a Chinese engineering firm, have signed a $1.6billion memorandum of understanding to set up an ultra-modern cement manufacturing plant in the country.

The agreement was part of the strategic partnership initiatives brokered by President Umar Yar’Adua during his recent state visit to China.

Finance Minister, Dr Shamsudeen Usman, who disclosed this in Lagos last week, said the deal was one of the joint venture strategic partnerships recorded by the high powered delegation.
The minister said that the investment breakthrough was recorded because the government attached so much importance to bilateral relationship with China and India while at the same time supporting regional trade initiatives.

Usman explained that it was on that basis that a broad framework for strategic relationship between Nigeria and China was agreed upon at the last February state visit by President Yar’Adua, which he noted will continually be developed through a broad based consultative group comprising government officials and members of the organized private sector from both Nigeria and China.

He stated that a memorandum of understanding with regard to financial operations between the Africa Finance Corporation (AFC) and some other Nigerian financial institutions, on the one hand and their Chinese counterparts, on the other hand, was drawn up.

He added that Nigeria would also be working with the Indian government on setting up a group comprising experts/ officials from both nations to meet bi-annually with financial institutions and farmers, with a view to enhancing the fortunes of the sector too.

Although details of the agreement were not released, there are strong indications that Sunoma, which is one of the world’s leading cement producing companies, would be assisting the Dangote Group to establish one of the largest cement manufacturing plants in Africa.

This would evidently come as a big relief to Nigeria’s building/ construction sector, which has lately been faced with acute shortage of cement, leading to astronomical price increases.
Only a fortnight ago the Federal Government, through the Ministry of Commerce and Industry, granted approvals to some end users and top construction companies, to bring in bulk cement to meet the nation’s estimated 11.5 metric tonne shortfall, which had earlier pushed the price of a standard 50 kilogramme bag of cement to over N2500.

The shortage was occasioned by the inability of local manufacturers to produce enough to meet local demand.
Geological survey of Nigeria’s cement potentials shows that the nation has abundant deposit of limestone and gypsum, which are basic raw materials for cement production. This may be a major attraction to several foreign investors, including Sunoma.