JANUARY 2020
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TWIGA CEMENT BUILDING TANZANIA INSPIRED BY YOUR SUCCESS
BUILDING TANZANIA TWIGA Cement chevron-square-right www.twigacement.com phone-square +255 746 810 930
The construction industry and the country it supports exist hand in hand – if one is thriving, so is the other. We spoke Yves Mataigne, Commercial Director at Twiga Cement, about Tanzania’s ongoing infrastructure push, and the steady, consistent growth happening in the exciting African country. Lastly, we of course spoke about how this growth is proving positive for TWIGA Cement and the many local and international contracting partners it supplies.
Written by Alice Instone-Brewer
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wiga Cement was founded in 1966, though it was nationalised in 1978 and later privatised again in 1998. It is now a part of the HeidelbergCement Group – a Germany-based company with operations around the world. Whilst a part of a far larger machine, Twiga is an impressive entity in its own right: the Portland cement producer is one of the largest in Tanzania. “We don’t have the largest theoretical production capacity in Tanzania, but nevertheless, we are perceived as the market leader” Yves explained. “We have a production capacity of around 2 million tons, and this year, we will again improve the sales volumes sold this year compared to prior year. This achievement leaves our competitors clearly behind us. As those figures show, Twiga is currently operating close to full capacity, which is fantastic news, but also a prompt that further expansion is required. The company could complacently stay as it is, but not wanting to miss out on business by being caught short, it is working to push what it is capable of, ready to meet rising demand from the country as it grows – and growing it is. Yves told us that the true appeal in Tanzania is that it not only has growth, but stability,
TWIGA CEMENT which is far more valuable than growth in a volatile market or country. “Tanzania is a very interesting country in the region for many reasons. What you see here is that growth and stability are going hand in hand together.” Tanzania’s GDP isn’t growing at the rate of some of its neighbours, but it is on a continuous, gradual increase. Its average growth over the past 25 years has been 6.2% a year, with the maximum hitting 8% and the minimum 3.5%. Compared to its next-door neighbour Kenya, which reaches 16%-20% for some years, this is nothing much, but at the same time, it’s stable and consistent, in a country that can support and utilise it. There is still a way to go. Currently, 37% of Tanzania’s inhabitants are living under the poverty line. However, there are reasons to be optimistic for the future. “There are lot of factors in this country that are very interesting. We have 162 different tribes, but they all speak in one common language, which is Swahili, and there are no tribe wars. There is also no tension
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between the two main religions in the country - the Christian and Muslim communities are living peacefully together. All of that gives people confidence.” Thanks to this stability, and to a peaceful democracy in the country, Tanzania is proving a popular destination for people to move to. This year, it has received 1.5 million inhabitants, and this is projected to continue. “On this front, it’s a fast-growing country. So, of course, there is the daily challenge of policies changing, and a government that is putting a lot of stress on short-term action, but on the other hand, the long term is going in the right direction.” As inhabitants and the GDP increase, the country must grow and develop with it. Tanzania is amidst a broad four-pronged development of its infrastructure, all of which makes work for companies such as Twiga, and the wider sector it plays a part in. Yves talked us through these four areas of development, to show us just how much activity is taking place in the African country. Firstly, there’s the road network, which the government has been improving for some years, and, in a similar vein, there is a push to improve the railways. “So, there is now a very important railway project ongoing,” Yves told us, “which is connecting Dar es Salaam to the capital, Dodoma, and then that connection will start to go towards Rwanda.” Dar es Salaam is Tanzania’s main port, and it, along with its other ports and harbours, are the third prong of the development push. Dar es Salaam’s port, in particular, in an important access point for Tanzania’s landlocked neighbors, such as Zambia, Uganda, Rwanda and even the DRC. Lastly, there is also a push to develop the country’s airlines, from international airports to smaller, local operations, including the restoration of existing terminals. This work is something that Yves expects to keep growing as steadily as Tanzania itself. This being the case, the fact that Twiga is already operating so close to capacity means that something has to change, if the company intends to be ready to match the demands of the future. Yves told us that he believes in evolution, rather than revolution: the gradual development of what exists, instead of a radical upheaval. “We’re keeping the reasons that we
BUILDING TANZANIA work well, and we’re just changing the status quo. We’re not going to build a new mill or a new kiln, but we do have an interest in the rehabilitation of an old mill, which has been less reliable over the past years. We thought it wasn’t needed anymore because we have two new ones, but, as the market is increasing, we will invest some millions of dollars to get it back on track.” By doing so we will be able to again increase our output by 200,000 ton/year. This restoration reduces waste, and makes the most of what Twiga already has, which is a more sustainable choice, as well as wiser business. When it comes to sustainability, Twiga’s greatest focus is on the responsible handling of its mines. Limestone is the key raw material used in cement production, and Twiga has its own quarries for its extraction. The company is also contentious about not wanting to leave any damage behind, and so takes steps to restore the land to how it was when it arrived. This effort includes landscaping and the planting of trees and other plants, as well as interventions
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TWIGA CEMENT enacted under the advice of biodiversity experts that visit from Twiga’s colleagues in Germany. On top we are giving support to the local communities via an involvement in their many schools around the plant. This is one of the many ways in which the HeidelbergCement Group supports Twiga and its other subsidiaries. It holds Twiga to higher safety and quality standards than are required by Tanzania, but as well as holding it to these standards, it supports it with a wealth of experience and technical expertise in every area of cement production. However, although they are an ongoing source of support, they also leave Twiga the space to operate: “On a local leave, we operate with a lot of autonomy, able to react to local circumstances, but always backed up with the knowledge of an international group operating behind us. This way of operating has always been the culture of HeidelbergCement: we can call on their expertise, they help us, but in the end we just work together.”
One of the benefits of being in this global group is a high level of cooperation and exchange between the companies. For example, for staff training, workshops are often hosted in different locations, with staff from all over the continents flying in to learn on a particular topic. Yves told us that Twiga recently hosted a workshop on procurement, and earlier last year, colleagues from Germany came over to exchange during a highly technical workshop on the kiln maintenance in particular. Yves doesn’t underestimate his staff, or the importance of the company and the Group investing in them: “Our people are making the difference on a daily basis. One of the main reasons is the competence in the people we are employing, and in the consistency of their work. For us, it’s consistency for our customers that matters, and thanks to that consistency, we are valued as the most reliable cement producer in Tanzania.” Over 10% of Twiga’s business comes from the export market, including Rwanda and the
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BUILDING TANZANIA DRC, but the vast majority of its business is local. This includes Chinese contractors, who have a high presence within the country, but Yves has been delighted to see Tanzania-based contractors also coming through strong. As for distributors, the company has a limited but powerful network, including a primary ‘Big Five’, as it calls them, which always have some stock in the market and thus are a constant stability for the company. Tanzania may be growing slowly, but it is growing, and from a foundation of peace that paints a positive picture for the country long term. Companies like Twiga are directly affected by this growth, and with its finger on the pulse, Twiga is making wise moves to prepare for these future opportunities. Like the country itself, these moves are slow and steady, but, like a sturdy structure of concrete, stable and built to last.
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