Ethiopia opens $600 mn Lemi National Cement plant

Ethiopia's Prime Minister Abiy Ahmed recently inaugurated the Lemi National Cement Factory, marking a significant milestone for the country's economic growth. The factory, which boasts a production capacity of 150,000 quintals of cement per day, is now the largest cement facility in Ethiopia. CNBC Africa's Flora Limukii sat down with Bhavesh Chandaria, CEO of Ethiopian Steel PLC, to discuss the implications of this mega project. Chandaria highlighted the importance of the cement industry in Ethiopia's economic landscape, emphasizing the need for expanded production capacities to support the country's ambitious infrastructure projects and development plans. He pointed out that while Ethiopia's per capita cement consumption is currently lower than that of North and South Africa, the inauguration of the Lemi factory signifies a step towards self-reliance and enhanced efficiency in the industry. Chandaria also shed light on the potential impact of the new facility on the construction and infrastructure sectors within Ethiopia, noting that increased local production could lead to reduced dependence on imports and lower costs for consumers. He expressed optimism about the unfolding market reforms and expected improvements in the distribution chain that could benefit both manufacturers and consumers. Moreover, Chandaria discussed the strategic positioning of Ethiopia in the cement market, suggesting that the focus would likely remain on domestic consumption rather than extensive exports to neighboring countries. When it comes to regulatory frameworks, he praised Ethiopia's adherence to industry standards and environmental regulations but emphasized the importance of continued reforms to streamline the value chain and enhance competitiveness. The CEO also highlighted the long-term effects of the Lemi National Cement facility, pointing to job creation, local tax revenue, and accelerated construction processes as key benefits for the country's infrastructure landscape. Overall, Chandaria expressed confidence in Ethiopia's economic trajectory and the role of the cement industry in driving sustainable growth and fostering strategic partnerships.