Premier: No cement shortage in S’wak, just rapid infrastructure dev

Abang Johari (center) witnesses the MoU documents exchange between Innocement Sdn Bhd chairman Datuk Dr Mohamad Abdullah Zaidell (right) and SCG International MD Abhijit Datta. – Bernama photo 

KUCHING (July 14): There is no shortage of cement supply in Sarawak, assured Premier Datuk Patinggi Tan Sri Abang Johari Tun Openg.

Despite having said that, he pointed out that Sarawak would have to increase its supply of cement in light of the rapid infrastructure development taking place statewide.

“We have sufficient supply of cement but our infrastructure development is happening fast. If cement is XYZ, we have X but falling short of YZ, so we have to fill YZ,” he explained.

He was speaking to reporters after witnessing the signing of memorandum of understanding (MoU) between Innocement Sdn Bhd, and SCG International and YTL Cement Berhad at a hotel here today.

Innocement Sdn Bhd is a joint venture between Sarawak Economic Development Corporation (SEDC) and Bintulu Development Authority (BDA), which was incorporated in February this year, and is charged with the mission to strengthen the cement supply chain in Sarawak.

SCG International of Thailand and YTL Cement, Malaysia’s biggest cement manufacturer are two of the biggest cement players in the region.

According to Abang Johari, Innocement Sdn Bhd will play its role to cater for the needs of cement supply in the northern part of Sarawak.

In his speech during the MoU signing ceremony earlier, he said the demand for cement in the state has surged and will continue to remain high as various development projects totalling RM45.967 billion are being implemented statewide.

He said these projects included the Pan Borneo Highway, Coastal Road, Second Trunk Road, Sarawak-Sabah Link Road and Trans Borneo Highway as well as infrastructure projects under the Integrated Regional Samarahan Development Agency (IRSDA), Sarawak Corridor of Renewable Energy (SCORE), Sri Aman Development Agency (SADA), Coastal Road Network and Second Trunk Road (CSTR) and Project Rakyat.

“Earlier this year, Sarawak’s Ministry of Infrastructure and Port Development received a list of 92 infrastructure projects, worth RM1.092 billion, from the federal government.

“All these projects will help to enhance living standards and the state’s economy; creating more business and employment opportunities for all Sarawakians,” he said when witnessing the signing of memorandum of understanding (MoU) between Innocement Sdn Bhd, and SCG International and YTL Cement Berhad at a hotel here today.

Innocement Sdn Bhd is a joint venture between Sarawak Economic Development Corporation (SEDC) and Bintulu Development Authority (BDA), which was incorporated in February this year, and is charged with the mission to strengthen the cement supply chain in Sarawak.

SCG International of Thailand and YTL Cement, Malaysia’s biggest cement manufacturer are two of the biggest cement players in the region.

According to Abang Johari, Sarawak requires reliable and adequate supply of construction materials to ensure the timely completion of all the development projects.

He cautioned that delays in the supply of construction materials would result in additional cost and impact the lives of Sarawakians especially for critical projects such as schools, hospitals and infrastructure.

“Shortages and disruption of supplies tend to result in escalation of prices to the point that budgets need to be revised and additional funds required,” he said.

He observed that cement accounted for three to seven per cent of the construction costs.

“Cement is basic to construction just like rice to us. In Sarawak, we have an underdeveloped cement industry with a very limited number of players, in fact only one.

“It is imperative for the development of Sarawak, to reduce the risk of total dependence on a single supplier. To create healthy competitive environment, we need to inject new blood into the state’s cement industry. That’s where we hope that Innocement Sdn Bhd will play its role to strengthen the industry,” he said.

Abang Johari said Innocement Sdn Bhd was set up to ensure that there is sufficient supply of cement throughout Sarawak, and that these cement supplies can be accessed in a timely and cost-effective manner.

He added that the corporation is also to make sure that not only are prices stable and transparent but the cement is of high quality that fully meets the national standards.

“When you are new, you need to do a lot to catch up with the market and an efficient, effective way to this is to collaborate, to work with others who are already established in the market.

“This is the strategy that Innocement has embarked on – to collaborate with other players. More specifically to collaborate with players who are established and world-class cement manufacturers,” he pointed out.

Through the collaborations with SCG International and YTL Cement, he believed that Innocement Sdn Bhd can fast-track its growth and readiness and cut short the time-to-market.

“We can then achieve our mission of strengthening the cement supply chain for the state, ensuring the long term reliability of supply and stability of prices of cement in Sarawak,” added Abang Johari.

Earlier, the Premier said Sarawak was among the top three states in the country with the highest value of construction works done.

He said the state contributed, on average, 12 per cent to the total construction works value for the country, even though the population of Sarawak only made up 8.5 per cent of the country’s total population.

“Over the last eight quarters (32 months since Q2 2021), the construction works value for the state averages RM3.45 billion per quarter against the national average of RM29 billion per quarter,” he added.