Production Rather Than Blame Game




 

Dear editors,

We are one of the pioneering steel manufacturing industries in Ethiopia, with an annual production capacity of over 360,000 tns of reinforcement bar and wire rod. We are in the industry after investing over 1.2 billion Br, while creating employment opportunities for more than 2,000 citizens. We believe we play a vital role in knowledge and technology transfer to the country and contribute our share to the success of the government’s Growth & Transformation Plan.

Such a commitment from the private sector is a necessary condition to creating rapid and sustainable economic development. We thus would like to take this opportunity to assure all our stakeholders and customers that we will continue to do so with an even greater zeal and commitment.

Be that as it may, however, we are witnessing persistent attempts by a handful of individuals to spread malicious information and defamatory statements mainly through the instrument of your newspaper. These individuals want to undermine and taint the very positive reputation that we command in the eyes of the general public and the government; they are vicious in their motive. They import finished wire rod at reduced tariff to directly sell to the general public at the expense of domestic manufacturers and small and medium scale nail producers, which do not have the capacity to import such wire rod.

These baseless accusations are reported in your newspaper headlined, “Industry Monopoly Claim Rocks PM’s Office” [Volume 17, Number 852, August 29, 2016] and “Nail Producers to Appeal to Consumers’ Authority” [Volume 17, Number 855, September 18, 2016].

Contrary to the assertions of the nail producers accusing us of undue price settings, our policy and practices since the establishment of our second factory and resumption of producing wire rod in March 20014 are the same. There has been no change made to date. Based on steel price development in the international market, we change our selling price from time to time; but, in so doing, no distinction is made between our customers and furthermore no preferential treatment is accorded to any of our clients – be these clients our affiliates or otherwise.

Any interested party, including your reporters, can also ascertain the veracity of this information from any one of our customers.

The nail producers, whose correct numbers have been inconsistently mentioned in your news stories, are repeatedly accusing our company of creating a monopoly in the county’s wire rod market. Not only is such an accusation totally unfounded, but also very misleading.

Monopoly is a market structure characterised by a single seller of particular goods or services in a given market, where the seller makes its dominant position to repel competitors from the sector, thereby enjoying a free ride therein. The fact that our company has been the only producer of wire rod in the county for some years should not in any way be construed as monopolising the market.

The government’s policy is loud and clear; the level playing field is open to all those interested to enter into the market. There are many in the country, including those who accuse us of monopolising the market, who are engaged in the business of importing wire rod from abroad. The incentives are open to all investors who have the resources and commitment, as well as the wisdom, to produce such products.

Encouraged investors, such as C&E Brothers and East Steel Manufacturing Plc, have now finalised their factory testing and reached the commissioning stage. We believe that they will start the production of wire rod within a few weeks, demonstrating the unfounded nature of those who accuse us of market monopolisation.

Our company carries out its activities and operations in strict compliance with the law of the land, and relevant rules, regulations and practices governing wire rod production and marketing. Those who accuse us of this cannot produce a shred of evidence to prove that we are giving preferential treatment to our sister company, ASMEN Plc, and at the expense of over 100 other customers, including nail manufacturers. Such an assertion is no more than the making of our accusers in their bid to create confusion and sow seeds of discord between us and our customers to pave the ground for their desire to import finished wire rod from abroad at lower customs tariff.

We understand that our accusers have sufficient resources and long experience in the sector should they resolve to engage in domestic wire rod production instead of resorting to unsubstantiated name-calling and accusation.

Getnet Endazenew

Marketing Manager

Steely R.M.I Plc



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