In an exclusive interview with CemWeek Magazine, Eng. Ahmad Al-Rousan discusses the evolution of the Arab Union for Cement and Building Materials throughout the years, and assesses how oil prices, terrorism and the global economic crisis are impacting construction projects in the region.
This interview originally appeared in CemWeek 46. Click on the image to read the full interview
Founded in 1977, Arab Union for Cement and Building Materials is an inter-Arab International organization, affiliated to the General Secretariat of the Arab League and the Council of Arab Economic Unity. Headquartered in Damascus, AUCBM aims principally at developing and supporting technical, industrial and commercial relations; coordinating industrial activities amongst its members in the field of cement and building materials; and participating in suggesting general grounds for developing these industries in Arab countries in order to achieve technical and economic integration among Arab countries through practicing its tasks, responsibilities and expertise.
The Arab Union for Cement and Building Materials (AUCBM) completed 40 years in March 2017. How has the organization evolved since its inception to the current day?
When the AUCBM was established back in the seventies of the last century, the cement industry was geographically limited in terms of spread on the Arab scale. It was present in a few Arab countries with a capacity not exceeding 40 million tons. The industry was mostly state-owned; it lacked qualified staff and relied on foreign expertise. Thus, AUCBM started giving priority to qualifying Arab cadres and conducting studies for the expansion of this industry, which has become a pioneer and is now spread all over Arab countries with a capacity of around 340 million tons. No doubt, the development and growth of the cement industry has led to the expansion of AUCBM tasks on both Arab and global scales, and it has now become one the most important associations globally.
The cement industry has contributed significantly to the economic growth of Arabia. What has been the role of Arab Union for Cement and Building Materials in the industry’s growth?
It is well known that economic growth in developing countries, including Arab countries, has a positive impact on the growth of building and construction industry – the essential industry for infrastructure and housing. Since the cement industry is a highly important component in the building and construction industries, AUCBM efforts were concentrated on helping countries create an advanced cement industry that meets the market demands. Additionally, the cement industry has generated others related to the construction sector, as well as other supporting industries – thus contributing in establishing an industrial base, providing jobs and qualifying workforce.
What new cement projects are being developed in the region?
The past few years have witnessed a large number of Arab and international investments in the cement industry, and the number of cement factories increased significantly, particularly in the GCC countries and Arab North African countries. However, the recent global economic crisis, lower oil prices, the invasion of several Arab countries by armed terrorist acts, and the movements subsequent to the “Arab Spring”, all have led to the decline of these industries in terms of building new factories and to the consequent lower consumption rates. Currently, the only countries with new cement projects are Algeria and Egypt, as well as Saudi Arabia to a certain extent.
How have oil prices influenced the industry lately?
Overall, the Arab cement industry, particularly the GCC countries, was affected by the decline in oil prices in 2017, and a large number of planned construction projects were postponed or canceled; naturally, this has led to the decline in demand for cement. The political instability in a number of countries has also contributed for this backdrop.
However, the recent increase in oil prices so far in 2018 may, to some extent, positively influence demand for cement in a limited manner. Additionally, expectations for reconstruction may open up demand growth.
Read the full interview in CemWeek 46