Govt assures sugar producers of protection

DAR ES SALAAM: THE government has assured sugar producers of their capital’s maximum protection, as they embark on transformative investments to address recurring sugar gap in the country.

Speaking during a press conference in Dar es Salam, on Monday the Minister of State in the President’s Office (Planning and Investment), Professor Kitila Mkumbo said the government is committed on protecting intensive investments being undertaken by the sugar producers to cater for the local sugar demand.

“We agreed together to supervise the law established for dealing with the sugar gap including making sure that only the National Food Reserve Agency (NFRA) is entitled to import s u g a r , w h e n there is a shortage, the government embraces investors’ existence and protects health of consumers,” he told journalists shortly after having a conversation with the sugar producers on way forwards for making the country achieve sugar self-sufficiency.

Prof Kitila said the government under President Samia Suluhu Hassan will keep on creating favourable environment for investors in all sectors, so that citizens can access commodities including sugar at affordable price.

He said the government in collaboration with the sugar producers will maintain stable supply of sugar by leveraging the five pillars of navigating the gap including identification of causes of the shortage.

He said the exercise for gauging the gap is done by the Sugar Board of Tanzania (SBT) and the producers.

Also read: SBT assures sugar producers, stakeholders maximum protection

Furthermore, Prof Kitila noted that another binding pillar is to ensure there is authorised importer which is the NFRA as approved by the National Assembly for the 2024/2025 Financial Year (FY).

He reminded that prior to the 2024/2025 FY, only licensed sugar producers were allowed to import the commodity.

More significantly, he noted that sugar is only imported during a shortage, especially when local factories halt their operation(s) due to among others- weather conditions like prolonged rainfall season, which hampered production by the end of 2023 and earlier this year.

The minister said the importation is carried out under reasonable custom duties and value added tax to protect local industries.

Prof Kitila said the deadline for importing is June 30 every year to give room for local factories to produce.

Highlighting the trend of sugar production in the country, he said it currently stands at 460,000 tonnes per year in comparison to below 300,000 tonnes per year five years ago.

“We are making good progress and in the next two years there will be no sugar gap in our country, at the end of the time our constructive chats should be on how we can export sugar,” Prof Kitila said.

He said the government has received the sugar producers’ request of amending the country’s Sugar Industry Act of 2001, to meet with current requirement of the sector.

In a statement released on July 1st this year, the Tanzania Sugar Producers Association’s (TSPA) said it was undertaking expansion of factories and sugarcane farms in efforts to contain sugar shortage by the end of the 2024/2025 financial year.

TSPA comprises of about five major sugar producing companies in Tanzania namely Kilombero Sugar Company Limited, Bagamoyo Sugar Limited, Kagera Sugar Limited, TPC Limited and Mtibwa Sugar Estate limited.

The sugar producer association highlighted that local firms makes 93 per cent of entire sugar supply from the total demand of 490,000 tonnes per year.

TSPA noted that local sugar production reached 460,200 tonnes in 2023 from about 300,000 tonnes in 2015 as the result of collaboration between the firms and the government on safeguarding local investment by among others, preventing irregular importation.

As a result, according to TSPA, the local industries reduced the sugar gap to 30,000 tonnes by the end of last year, from 144,000 tonnes in 2017.

“Currently, all the industries are undertaking intensive expansion on sugarcane growing and processing to mitigate the sugar gap in its entirety by the end of 2024/2025 Financial Year,” read the statement.

TSPA assured that under the ongoing ambitious efforts, the sugar production capacity can stand between 528,000 and 663,000 tonnes by 2025/2026 FY.

Earlier, the Director of the Bagamoyo Sugar Limited, Mr Hussein Sufian in a meeting with journalists, which was organised by TSPA also in the country’s business hub of Dar es Salaam outlined various major projects on execution by local producers including expansion of the Bagamoyo sugar industry from producing 30,000 tonnes of sugar to 60,000 tonnes.