The Government has ordered an investigation into the 3.2 per cent increase in cement prices introduced by the Caribbean Cement Company Limited (CCCL), recently.
Minister of Industry, Investment and Commerce, Hon. Karl Samuda, told journalists at a press conference at his office, St. Lucia Avenue, New Kingston, on Tuesday (June 15), that the Government was extremely concerned about the reasons for the increase and would be conducting a thorough investigation into the matter.
“So concerned am I, as the Minister responsible for protecting the interests of the consuming public, that I have, to date, instructed the Permanent Secretary to formalise with the Fair Trading Commission, a process that will lead to an investigation of the cost structure of the Caribbean Cement Company,” he said.
Minister of Industry, Investment and Commerce, Hon. Karl Samuda (right), responds to a question raised by a member of the media, during a press conference at his St. Lucia Avenue office, in Kingston, on June 15. At left is Executive Director of the Bureau of Standards, Noel Osbourne.
“We will be going in there to investigate the pricing structure and how they arrive at their pricing, because what we are seeking to do is avoid any abuse of the dominant position that the company may hold,” he expanded.
He stated that since the company holds a central position in the market, it is the FTC’s responsibility to ensure that it does not abuse this position.
The Minister also told reporters that the announcement of an increase by the sole manufacturer of Portland cement in Jamaica came as a shock and disappointment, because all other indicators suggested the stabilisation of prices rather than an increase.
“What is even more disappointing are the reasons given by the Cement Company for the increase,” he added. He noted that CCCL said the price increase is to offset higher operational costs, as well as address the issue of stockpiling.
Minister of Industry, Investment and Commerce, Hon. Karl Samuda (second left), speaking to journalists during a press conference at his office on St. Lucia Avenue, in New Kingston, on June 15. Others (from left) are: Executive Director of the Bureau of Standards, Noel Osbourne; Permanent Secretary in the Ministry, Reginald Budhan and President of Jamaica Promotions Corporation (JAMPRO), Sancia Bennett-Templer.
Mr. Samuda said the Government was made to believe that the recent expansion and improvement in the operations of the Company would have led to a more efficient organisation, which would in turn lead to reduced costs.
“It was on that basis that they were given the kind of encouragement and incentives from the Government that they received. And to learn, at this stage, when all the signs are going in the right direction to contain costs, which we have seen in the retail area, where prices have stabilised considerably and are going down, the Cement Company is going to the opposite direction!” he exclaimed.
In the meantime, the Minister warned that he would also be watching the movement in the prices of imported cement to ensure fair competition.
“It cannot be that, coincidentally, their prices increase at roughly the same rate as the Cement Company has proposed and at the same time. We will be watching very carefully because we don’t want any ‘tucking in’, we want true competition to exist and we want to give the consumers the best price,” he said.