Mozambique Dugongo Cimentos, a company held by the business arm of Frelimo, the ruling party, said on Monday it will pay the 20.5 million metical penalty imposed in August for anti-competitive practices.

The fine was decreed by the Competition Regulatory Authority on the grounds that Dugongo failed to respond to questions from the regulator about "sales price calculation methodologies" raised by "evidence of anti-competitive practices in the construction cement sector."

In statements to Televisão de Moçambique (TVM) and quoted by Lusa, the cement company's spokesman, Rui de Carvalho, assured that the company will pay the penalty, but accused the regulator of not having made representations to Dugongo.

"We will pay the fine, but we were not contacted and the decision to fine the company was made based on correspondence taken from the company without the knowledge of the administration," Carvalho said.

A spokesman for Cimentos Dugongo rejected the accusations made by the regulator, arguing that the company will only pay to protect "national interests", without being specific about the meaning of this expression.

Mozambique Dungongo Cimentos is owned by the Mozambican SPI and Chinese West China Cement Limited (WCC) business groups.

SPI is an entity that has been associated by research institutions with the Mozambique Liberation Front (Frelimo) and holds a vast business portfolio, a situation that the ruling party has never commented on.

Soon after its entry into the market, in May 2021, Cimentos Dugongo practiced cement prices much lower than those applied in the market, leading other operators to accuse the company of disloyalty and of causing the bankruptcy of other cement companies and layoffs in the sector.

After months of activity and with very low prices, the company has raised the cost of cement to levels close to what was practiced by the cement plants forced to close.