THERE has been a notion that privatisation of local sugar industries 20 years ago has failed to meet the intended objectives in making the country self-sufficient.
This notion has been used to justify duty free importation of sugar into the country, that in turn has crippled local sugar industries to the point where if no immediate and deliberate action is taken by the government, they might be headed for a closure.
As it stands, allowing for all premiums, freight costs and other logistics costs, current world prices translate into a delivered cost to
According to industry sources, world sugar prices are so low because the largest sugar producing countries are heavily subsidising sugar exports. The Managing Director of
"This means that effective protection of the domestic market is essential," he says. While
According to data from
TSPA says by these figures, direct sugar consumption deficit stands at 80,000 tons but between
At stake are 5,500 employees who received a total of 88bn/- in remuneration and benefits between 2007 and 2012 and 5,600 out growers who receive an average of 30bn/- annually. Due to lack of funds, workers' union is already considering action while out growers discontent is rising for lack of retention payment.
The situation worsened and as of
If the country does not take deliberate measures to control sugar imports and protect the local industry, at stake are 75,000 jobs equivalent to five per cent of total national employment that are created by the industry.
Since privatisation of sugar industries in
Sugar industry further contributes one per cent of the national GDP and accounts for 1.9 per cent of total income tax. Since privatisation, the four sugar industries in the country,
KSCL has also invested another
On the other hand,
While these are some of the things to suffer immediate effect if sugar importation is not curbed, the future of the industry doesn't look good either. The demand for direct sugar consumption is linked with the country's population growth among other things. By 2030 Tanzania's population growth is estimated to reach 72 million people according to
This would then mean that the domestic sugar demand will rise to 1,500 tonnes by 2030 creating a gap of a whopping 1,100 tons if conducive environment for new investments particularly sugar policy and tax revisions are not put in place.
This gap will have to be filled by imports which then would mean killing local sugar industries because of the low cost of imported sugar.
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