The Uganda government has given local steel manufacturer Roofings Ltd the green light to supply the country’s infrastructure projects, including major dams currently under construction.
David Bahati, Minister of Finance for Planning, while launching new products at Roofings’ new plant at Namanve Industrial Park on the outskirts of Kampala on September 5, said the firm will supply steel building materials for the 600MW Karuma and 183MW Isimba hydropower projects.
“We had a number of discussions with Roofings and the issues were mainly the quality of products, which the firm has resolved, and the other was capacity. Roofings has assured us they can supply projects like Karuma and Isimba and the government is now comfortable with the results from our assessment,” said Mr Bahati.
Executive director of Uganda Manufacturers Association Sebaggala Kigozi had questioned why imported foreign products were preferred over domestic supplies.
“We can’t develop unless the government takes a stand on local content. Why buy Chinese steel while Roofings, which uses 40MW of power, is here?” he asked.
“The debate on local content is critical. About 80 per cent of the government’s budget goes to procurement. The question is how many Ugandans take advantage of their budget even though they are the taxpayers? To what extent do we use our own raw materials?” asked Gideon Badagawa, the head of the Private Sector Foundation.
Roofings Ltd has in the past urged the East African Community partner states to prioritise and increase uptake of local supplies for infrastructure and donor-funded projects as a way of promoting the Buy East Africa, Build East Africa campaign.
“As a government, we have embraced local content. A policy has been developed and we are just waiting for a law to operationalise it,” said Herbert Kabafunzaki, Minister of State for Labour, Employment and Industrial Relations.
Roofings is seeking to meet the market’s needs by expanding and introducing new products. Last week, the firm launched aluminium and zinc-coated steel also known as AZED.
The alloy-coated product contains 55 per cent aluminium, 43.5 per cent steel and 1.5 per cent silicon by weight. It is ideal for applications that require superior corrosion resistance and heat reflectivity, according to Roofings chairman and managing director Sikander Lalani.
Roofings has doubled its output following the commissioning of a second plant worth $170 million in Namanve Industrial Park in 2014.
The plant has three production units, which together have a production capacity of 250,000 tonnes per annum.
Apart from lobbying for favourable local content policies and laws, Mr Lalani proposed an increase in the EAC Common External Tariff (CET) on galvanised wire to 25 per cent and for reinforcing bars to have either a fixed import tax rate based on volume at $250 per tonne or based on value at 25 per cent CET, whichever is higher.