Writes Leo Odera Omolo

An Egyptian entrepreneur plans to inject at least Tshs 396 billion {USD 200 million} into a sugar plantation and processing factory at a location near the Tanzanian capital, Dar Es Salaam.

Egyptian African Company for Investment and Development revealed it plans to acquire a plantation of between 10,000 acres and 20,000 acres in Rufiji, some 100 kilometers from Dar Es Salaam.

The company’s chairman Mostafa EL Ahwal said last week that the company expects to produce the first consignment of white sugar in the year 2014. The plantation in Rufiji, under Agro Forest Plantation Limited, will produce 500 tones to 750 tones of sugar per day translating into at least 120,000 tones of sugar per annum. This output is expected to help reduce the country’s reliance on sugar imports and bring prices down.

Tanzania is however, currently experiencing sugar glut with the sugar Board of Tanzania saying it has 460,000 tones of sugar, local demand is 380,000 metric tones per year.

Despite the increase in supply prices are still high at between Tshs 2,000 {USD 1.27} and Tshs 2,500 {USD 1.59} per kilogramme. The high prices have been attributed to factors such as transport and importation costs. Unreliable power supply and rising fuel costs, both major inputs in the manufacture of sugar, have also contributed to the high costs.

The increased production should also see Tanzania export more sugar as none of the East African Community member countries Is currently self sufficient in sugar production while the demand for the product continues to rise.

The entry of the Egyptian firm is the latest in a string of investments from the North African nation in Tanzania. Egypt Air recently resumed flights to Tanzania. The local project co–coordinator for Agro-Forest Plantation Ltd, Kiondo Mahanya, said that the focus of sugar production would include the smallholder farmers.

Tanzania may witness unprecedented levels of investment in the future because the regime in Egypt considers Africa a priority,” said the Egyptian ambassador to Tanzania HOSSAM Moharam.

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