BAGHDAD — Iraq's association of cement manufacturers
on Tuesday slammed a government decision to reduce subsidies
on fuel for the
sector, warning the move risks factory closures and cement price increases.
اضافة اعلان
The oil ministry earlier this month raised the price of fuel
sold to cement manufactures from 150 Iraqi dinars per liter (around $0.1) to
250, following on from a previous hike earlier in the year.
The measure caused industry outrage in the crisis-hit
country, where some regions are still waiting for costly post-war
reconstruction.
"The cement industry is the only one that has been
self-sufficient from 2016 until now and hasn't raised prices," Ammar
Al-Saadi, deputy director of the cement manufacturers' association, told AFP on
Tuesday.
He said public and private activity in the sector employed
almost 50,000 people directly or indirectly, from factory workers to truck
drivers.
The association warned of "enormous losses" in the
sector, calling on authorities to reverse the decision.
Cement manufacturers will have to choose between
"closures, which would lead to thousands of lay-offs ... or an increase in
the sale price of cement to at least $10 a tonne," a statement from the
association said.
"That would increase the burden for the population and
the state, which is embarking upon the reconstruction of the country and wants
to develop infrastructure projects."
The subsidized fuel price for cement manufacturers was
originally approved in exchange for their commitment to cap the price of
cement.
"The decision will lead to an additional cost of 35
million euros per year, which could lead to heavy losses for the
business," said Adham Al-Sharkawy, head of Lafarge Iraq.
He said the measure could threaten more than a thousand jobs
if the firm is unable to pay salaries.
Iraq is the number two oil producer in the Organization of
the Petroleum Exporting Countries and almost all of its revenues come from the
sector.
Authorities say they want to diversify the economy to reduce
their dependence on the sector.
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