By Kingsley Jassi
Minister of Industry and Trade Vitumbiko Mumba has hinted on a protectionist stance in production of strategic commodities including sugar.
Mumba toured Salima Sugar Company on Monday as it began sugar production and supply, a move that promises improved availability on the market amid shortages that have spiked unsanctioned price hikes. He announced revocation of sugar export licenses to ensure supply stability while import licenses will also be issued for the same purpose.
He further disclosed an attempt to ban unlicensed sugar vending but said legal banking was a challenge.
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He said no controlling equity investment will be allowed into Salima Sugar Company and will make sure any investment deal leaves the company in the hands of the state.
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“We should ensure that the government controls strategic investments like sugar production. Other countries like Mozambique and Botswana never privatized their sugar companies and they don’t have sugar supply issues like we have,” Mumba said.
Mumba further said the government will follow up on a feasibility study to establish a sugar plantation and factory at Vwaza to increase national sugar production capacity which is said to be at less than 20,000 metric tons monthly.
However, Executive Chairman of Salima Sugar, Wester Kosam, said the company is producing below capacity, cultivating on a 1,500 hectares land out of the available 6,000 hectares.
This limits sugar production to just 150 tonnes of sugar a day, translating to 4,500 tonnes a month, as the country demands about 20,000 tonnes a month, largely supplied by Illovo.
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“We have several proposals that have been submitted to relevant authorities and we are just waiting for their decisions,” Kosam said.
He explained that among the proposals include finding strategic investors, leasing out the farmland to mega farmers or listing the company on Malawi Stock Exchange to raise funds for capital investment.
Some economists, including Malawi Confederation of Chambers of Commerce and Industry (MCCCI) have previously called on the government to lead in investing in strategic production of the country to address structural issues the economy is facing. On this Mumba said his Ministry will work with Ministry of Finance and other ministries to work on financing of strategic investments to ensure control of the economy.
