SBT assures sugar producers, stakeholders maximum protection

DAR ES SALAAM: THE Sugar Board of Tanzania (SBT) has assured sugar producers and other stakeholders that it will continue to safeguard investors and sugar factories by fostering a favourable environment in recognition of the sector’s contribution in the country’s social and economic development.

Speaking to journalists on Friday in Dar es Salaam, the SBT Director General, Prof Kenneth Bengesi said the recent government move to mandate the National Food Reserve Agency (NFRA) to import and store sugar to address scarcity of the sweetener does not aim at weakening local producers.

He said the government aims at relieving producers from the burden of production and stockpiling, allowing them to concentrate on sugar production.

“What the government is doing is for the broader interests of the government and its citizens. The focus is mainly on ensuring reliable supply of sugar at affordable prices,” noted Prof Bengesi.

He added: “We have found that when shortages occur, sugar prices hike sharply and do not easily revert to normal levels, so I believe by giving this responsibility to NFRA, it will help resolve this issue, and Tanzanians will have certainty in their business activities.” Prof Bengesi said that alongside protecting investment in the sugar industry, the government will continue to shield other stakeholders, including sugarcane farmers, consumers and financial institutions that provide capital to these producers.

He further stated that the government will continue to engage with all stakeholders, including sugar investors, to find solutions to the challenges they face, with the aim of ensuring the sustainability of the sugar industry in the country.

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According to Prof Bengesi, NFRA will only import sugar when there is a shortage of the product under emergency call, and thus mandating the authority to the task does not aim at creating problems in the industrial development system.

He said: “The complementarities we have been receiving from international sugar organisations in SADC and EAC on the stability and the conducive environment in the sugar sector are immense for our country, and that is why we have been able to attract the significant investment that is ongoing.”

Moreover, Prof Bengesi said that the government has been protecting local industries and producers by creating a conducive investment environment, including providing incentives such as land, removing VAT exemptions on some equipment and tax exemptions on fuel and lubricants used in the expansion of farms and factories.

“All these efforts are made to ensure that investors have a good investment environment, but it also reduces their capital costs, enabling them to invest effectively. This is because the government recognises the importance of this investment for the country’s development and the growth of our economy,” he said.

Over the course of the past five months, Tanzania has faced sugar deficit that prompted price hike as the government opened windows for imports by local producers to curb the shortage.

According to the Ministry of Agriculture, sugar production reached 460,049 tonnes in 2022/23, while demand stood at about 800,000 tonnes for the 2023/2024 fiscal year Presenting budget estimates of his office for 2024/25 financial year, Prime Minister Kassim Majaliwa said the government plans to ramp up production to 700,000 metric tonnes by the end of 2025/26 financial year.

Mr Majaliwa said the government has launched initiatives to boost sugar production by 53.5 per cent over the next two years to ease shortage.

Last month, the government mandated NFRA to import and store sugar to address scarcity of the sweetener, an oft repeated drawback.