What holds up Sh660bn Bagamoyo sugar project

Dar es Salaam. Delayed completion of a land compensation report, poor infrastructure and power challenges impede the implementation of a Sh669 billion sugar project by Bakhresa Group in Bagamoyo

The group corporate affairs director, Mr Hussein Sufian, has told BusinessWeek: “We are waiting for the completion report to compensate people whose land will be taken to set up the factory.”

However, Ministry of Land officials have conducted land valuation.

Apart from the delayed report, the area is impassable during the rainy season.

Last October President John Magufuli offered Mr Said Bakhresa, the group founder, 10,000 hectares to set up a sugar factory.

“Infrastructure is poor. We could build it on our own, but that is costly as the project is new,” said Mr Sufian.

He said the project is scheduled to be completed in five to 10 years.

There is no access to electricity to pump water to irrigate sugarcane plantations.

“At least we currently have option because so far the usage of power is not that high. We use generators as a substitute.”

Currently, 1.4 megawatts are consumed. After starting a full irrigation system, more power will be needed as the number of pumps will increase.

The company is set to use subsurface drip irrigation system. It is also committed to using an automated system during harvest period.

The group has communicated with Tanzania Electric Supply Company on power solutions and the utility has surveyed the site.

Tanzania is implementing its industrialisation agenda and aims at reaching a middle-income economy by 2025.

The Bagamoyo sugar plant will be undertaken in three phases. The first phase involves planting seedlings, establishing sugarcane plantations and constructing sugar mills.

The Sh167.3-billion first phase, which kicked off in 2017/18, is scheduled for completion in 2020, according to Mr Sufian.

The second phase will involve expanding sugarcane plantations, starting with 2,000 hectares.

How the third phase will be undertaken will depend on phases one and two.

Tanzania has four major sugar companies: Kilombero, Mtibwa, Kagera and TPC.

The four factories produce 300,000 tonnes of sugar annually while demand is 420,000 tonnes. The shortage is covered by importing the commodity.

Bakhresa’s factory is expected to be producing more than 30,000 tonnes of sugar annually. “We don’t fear competition. Since the country faces a sugar shortage, buyers will be there,” said Mr Sufian.

Delayed completion of a land compensation report, poor infrastructure and power challenges impede implementation of the Sh669 billion sugar project by Bakhresa Group in Bagamoyo. The group corporate affairs director, Mr Hussein Sufian, told BusinessWeek: “We are waiting for completion of the report to compensate people whose land will be taken to set up the factory.”

However, Ministry of Land officials have conducted land valuation. Apart from the delayed report, the area is impassable during the rainy season. Last October President John Magufuli offered Mr Said Bakhresa, the group founder, 10,000 hectares to set up a sugar processing factory.

“Infrastructure is poor. We could build infrastructure on our own, but that is costly as the project is new,” said Mr Sufian.

He said the project is scheduled to be completed in five to 10 years.

There is had no access to electricity to pump water to irrigate sugarcane cane plantations. “At least we currently have option because so far the usage of power is not that high. We use generators as a substitute.” Currently, about 1.4 megawatts are consumed.

After starting a full irrigation system, more power will be needed as the number of pumps will increase.

The company is set to use subsurface drip irrigation system. It is also committed towards using an automated system during harvest period.

The group has communicated with Tanzania Electric Supply Company on power solutions and the utility has surveyed the site.

Tanzania aims at realising its industrialisation programme of reaching a middle-income status by 2025.

The Bagamoyo sugar plant will be undertaken in three phases. The first phase involves planting seedlings, establishing sugarcane plantations and constructing sugar mills.

The Sh167.3-billion first phase, which kicked off in 2017/18, is scheduled for completion in 2020, according to Mr Sufian.

The second phase will involve expanding sugarcane plantations, starting with 2,000 hectares.

How the third phase will be undertaken will depend on phases one and two.

Tanzania’s four major sugar companies are Kilombero, Mtibwa, Kagera and TPC.

The four factories produce 300,000 tonnes annually while demand is 420,000 tonnes.

Bakhresa’s factory is expected to be producing more than 30,000 tonnes of sugar annually.

“We don’t fear competition. Since the country faces the sugar shortage, buyers will be there,” said Mr Sufian.