Lowveld: The government is formulating plans to establish a new sugar milling company in the Lowveld region, following its unsuccessful attempt to acquire one of the country’s largest sugar estates, Tongaat Hulett.
This development comes in the wake of Tongaat Hulett’s financial distress in 2022, caused by a debt burden of R7 million and an accounting scandal, leading to the company being placed under business rescue.
In July of this year, the business rescue practitioners announced their intention to sell Tongaat’s operations, including those in Zimbabwe, to Kagera Sugar of Tanzania. However, the government reportedly submitted a bid to take over the estates via the Sovereign Wealth Fund, now known as Mutapa Investment Fund.
In an official statement issued yesterday, the Ministry of Industry and Commerce invited both local and international investors to submit proposals for the establishment of a new sugar mill in the Lowveld. The objective of this mill is to provide an alternative source for sugarcane milling, benefiting the multitude of farmers in the region seeking such alternatives. The government is ready to consider proposals in this regard.
Tongaat’s operations, which encompass Hippo Valley, represent over 50% of Zimbabwe’s total sugar production. Additionally, the government has been collaborating with Tongaat and local banks on Project Kilimanjaro, a venture aimed at opening up 4,000 hectares of previously unused land for sugarcane cultivation. Under this initiative, the government selects the beneficiaries who will receive land for cultivation.
Dahlia Garwe, Head of Corporate Industry Affairs at Hippo Valley Estates, confirmed that the company had donated the Project Kilimanjaro land to the government. However, she noted that no significant progress has been made on the project so far. Garwe explained that the government has now completed the allocation of land and will soon communicate with the concerned farmers. She further expressed the company’s commitment to assisting the newly resettled farmers with land development and providing technical support in the future.
