PPC Limited is set to expand its business in Zimbabwe by 2020 by spending US $200m for the construction of milling facilities in Harare and Clinker assets in Bulawayo and Gwanda. This will help in the increase of the capacity of cement in the country by 1.2million tonnes annually.
This comes in place at a time when the cement market in Zimbabwe is developing from cash in hand sales for home building towards renewed maintenance spending on national infrastructure.
The Harare milling plant will be constructed at a cost of US $86m and is expected to be complete and in operation in the middle of 2016.
According to the MD of PPC Limited Zimbabwe, Njombo Lekula, the cement company has seen positive improvement since the dollarization of Zimbabwe economy in 2009.
The spending by PPC Limited in Zimbabwe is part of its ramp up in African investment out of South Africa. The company also has the aim of getting at least 40 percent in revenue from the rest of the continents by 2017.
All this will lead to the rise of the company’s debt to between US $0.81bn to US $0.97bn. however, the company has ring fenced its debts for the African investments which include the new mill in Zimbabwe, a plant in Rwanda, a cement factory under construction in Democratic Republic of Congo and a cement plant in Ethiopia worth US $135m and is 51 percent owned by the company.
All this comes in a time when the cement industry competition has risen in the region with the entry of Nigerian Sephaku Cement and Chinese Mamba cement.
However, there is a bit of relief for PPC Limited and other South African cement producers after the International Trade Administration Commission of SA imposed provisional anti dumping duties on Imports of cement up to 13 November.