Local sugar loses to importsDAILY NEWS Reporters
Daily News; Friday,December 26, 2008 @21:15
Sugar industry is in another crisis as producers and Sugar Board of Tanzania (SBT) are complaining over rampant dumping of sugar from abroad while other authorities are refuting such claims.
The board claims that over 18,000 tonnes of illegally-imported sugar and whose safety is not guaranteed, have flooded the local market for the last four months, thus, posing health hazards to consumers.
SBT Director General, Mr Mathew Kombe, told the "Daily News on Saturday" recently that the Board has conducted thorough survey to most strategic selling points throughout the country and found out that at least 6,000 tonnes have been imported illegally per month since last September.
We communicated to the authorities on this matter, maybe they are working on it. We are not issuing licences to private dealers to import sugar for the time being as the importation licences expired since last September. We are wondering how the consignments are getting into the country, said Mr Kombe.
He said the Board established further that sugar was being imported from India, Mozambique, Zambia, Malawi and Egypt. Mr Kombe said that assessment done by the board had established that the current local supply meets the demand.
He said total demand of sugar in Tanzania stood at about 330,000 tonnes per annum while the manufacturing capacity was about 300,000 from Kilombero Sugar Ltd and Mtibwa Sugar Ltd of Morogoro, Kagera Sugar Ltd of Bukoba, Kagera Region and TPC Ltd of Moshi.
The 30,000 tonnes deficit was to be met by licensed importers whose licences expired last September. This worries us much because most of Tanzanias consumers are not well informed, they can just buy sugar without enquiring about quality of the product.
We do not know how safe the sugar is, said Mr Kombe. Early this month, the owner of Mtibwa Sugar company Mr Nassoro Seif told President Jakaya Kikwete that there was rampant dumping of imported sugar in the local market, something which was adversely affecting local sugar industries.
He said that two ships with over 12,000 tonnes of sugar were at the outer anchorage, readying to offload the consignments. Mr Seif noted that such dumping had terribly affected his company, which now owes out-growers over 1.2bn and owes Mvomero District council and PPF millions of shillings.
He requested the President to make personal intervention to rescue the local sugar industries. The minister for Agriculture, Food Security and Cooperatives Mr Stephen Wasira said he was aware of the situation. We have already met to discuss the problem and the government is working on it, he said.
In the meantime, a senior government official who preferred anonymity said that local producers have always been complaining over the importation of sugar while they had failed to meet the demand over years. Handling of sugar industry is always very tricky because it involves powerful and wealthy businessmen of this country - both producers and importers are wealthy and powerful, therefore, there is a tug of war between the two parties.
But licensing for importation of sugar is done through SBTs technical committee which also comprises representatives of producers and importers. And all imports are handled at the port by Port Authorities and Tanzania Revenue Authority (TRA), he pointed out.
He added: Licensed sugar importers are taxed 25 per cent while those importing without licences are taxed 100 per cent. The TRA Acting Commissioner of Customs, Mr Warid Juma said TRA was not informed of the illegal sugar importation, although he admitted there were some minor illegal routes that were being used to smuggle in small quantity of about 20 kilogrammes of sugar.
There are illegal routes especially at border points which are used to smuggle in small quantities of sugar. But we usually seize illegally imported consignments and confiscate them, he said. Mr Juma said he was aware that licences issued to importers expired since June, this year and only last October there was a meeting with representatives of sugar manufacturers, Sugar Board, importers and TRA on sugar situation in the country but no such complaints (of dumping) were raised.
We did not receive any complaints from anybody, let alone the Sugar Board about this matter. But we ask the stakeholders to keep on informing us if they detect any dubious sugar business going around, said Mr Juma. He however, said some private importers were still importing industrial sugar to cater for the needs of manufacturers of beverages, sweets and the likes.
He did not rule out the possibility of unscrupulous dealers mixing brown and industrial sugar. On why sugar was too expensive despite being produced in large quantities in the country, Mr Kombe mentioned production costs as a main contributing factor for hiked sugar price. He said all four industries were consuming lots of fuel and transport costs were also another factor for high prices of sugar.
According to him, it takes about 60 US dollars to move only one tonne of sugar to Dar es Salaam market. A survey by "Daily News on Saturday" revealed that one kilogramme of sugar was sold in retail shops at 1400/- per kilogramme and Mr Kombe said manufacturers were incurring costs of about 700/- a kilo before VAT and transport charges.