Countrywide cement shortages could undermine Myanmar’s rapid infrastructure development, with projects throughout the nation in danger of being delayed, industry insiders say.
Myanmar’s rapid economic expansion has seen year-on-year increases in the demand for cement, with national demand expected to reach 10 million tonnes by 2015.
However, without foreign investment in Myanmar’s cement industry, domestic producers won’t be able to meet the required national targets, U Soe Naing, advisor to KBZ Construction Co Ltd, told Myanmar Business Today.
“In previous years, around 8 million tonnes of cement were needed, of which 4 million tonnes were imported. Domestic producers lack capital resources to produce enough [cement] by themselves,” he added.
According to official data, however, domestic production only accounts for 32 percent of the country’s cement stocks, with imports totalling 3 million tonnes, mostly from Thailand and India, making up the remaining supply.
However, Ko Ko Htwe of Taw Win Construction said most Southeast Asian manufacturers use cheap machinery that is incapable of meeting the rapidly increasing demands of Myanmar and the ASEAN region.
The implementation of the ASEAN Economic Community (AEC) in 2015 could also see increased regulations that terminate the operations of plants using unsafe production methods.
Myat Company and Thailand’s SCG Cement plan to construct new plants capable of producing 5,000 tonnes per day in Kyaukse in Mandalay region and Mawlamyine in Mon state by next year.
Electricity shortages have also undermined the capacity of Myanmar’s domestic cement plants to produce the raw materials needed for the country’s infrastructure.
Myanmar’s electricity problems are well documented with power outages, brownouts and supply shortages commonplace throughout the country.
U Soe Naing said a cement business association is being founded in order to tackle the power and resources issues hindering Myanmar’s cement dearth.
“After the association is created, we will negotiate with the government to purchase electricity at a discounted rate and seek to share technology with international businesses to become more effective,” he said.
