Business

WatchDog: Devki On Path To Monopoly In New Proposal

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The Kenyan Competition Authority (CAK) has warned the government against enacting billionaire businessman Narendra Raval’s proposal to increase the import duty on clinker, a raw material used in cement manufacture, from 10% to 25%.

Mr Raval, whose Devki Group controls four cement companies, has lobbied the government to raise the levies, claiming that the country now has enough clinker capacity to meet its needs.

The proposal, according to the competition watchdog, is a self-serving maneuver by Devki, which has a near-monopoly on the means of creating clinker and risks shutting down rival factories and hiking cement prices.

The regulator stated that imported clinker is cheaper and that the window to import or make it locally should be maintained to enable healthy competition in an advisory opinion to State House, the Treasury, and other government ministries.

Raval’s rivals, Bamburi Cement, Savannah, and Rai, have objected to the State considering raising the import duty.

Raval will be able to control cement pricing by influencing rivals’ production costs and destroying them by controlling the supply of the essential raw material, according to the watchdog.

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The 59-year-old millionaire, who gained his money in the steel sector, has invested billions of shillings in his cement empire in recent years.

Devki produces steel products, roofing sheets, and cement, among other things, and generates yearly revenues of more than $800 million (Sh88 billion).

National Cement, Simba Cement, ARM Cement, and Cemtech are now owned by the conglomerate, which has fueled its expansion with its own funds and loans from banks and the International Finance Corporation (IFC).

Devki organizations own 84 percent of the limestone mining allotment, giving them disproportionate control over the mineral’s extraction.


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