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Sunday, 7 March 2010

Parliamentary Question (Zambia Sugar)

Parliamentary Questions (PQs) are an important source for getting valuable information from government on key areas, especially given the lack of general accountability. I am keen for us to systematically highlight some of the most important questions been asked in the House. A recent question was raised on Zambia Sugar :

Zambia Sugar Company's Future Operations, Oral Answer (247),  Edited Transcript, 24th February, 2010 :

Mr Mwango (Kanchibiya) asked the Minister of Commerce, Trade and Industry:

(a) what expansion measures had been put in place for the Zambia Sugar Company’s future operations; (b) how much money was expected to be invested by the company in its future expansions; (c) how many full-time jobs would be created after the completion of the company’s expansion plans; and (d) what the source of funding was for the expansion project of the company.

The Minister of Livestock and Fisheries Development (Mr Machila) on behalf of the Minister of Commerce, Trade and Industry (Mr Mutati):

Zambia Sugar Plc is currently implementing an expansion programme running from 2007 to March, 2013. Once the plant is fully operational, the annual production is expected to increase by 69 per cent from 246,468 tonnes in 2005/2006 to 440,055 tonnes in 2012/2013. The programme includes planting an additional 10,422 hectares of land, constructing new roads and twenty-six kilometres of new canals as well as upgrading the existing plant.

Zambia Sugar Plc has, to date, invested a total of US$ 246 million (from 2007 to 2009) in its expansion project, against a pledged investment of US$185 million. The project involves expansion of the sugar plantations to increase the hectarage of sugarcane planted, acquisition of a new farm (Nanga Farms), investments in future out-grower schemes and expansion of the boiler room and sugar factory.

Zambia Sugar Plc has created 3,500 jobs from 2007 to 2009 in its expansion project that includes seasonal workers working in the sugar plantations against the pledged employment levels of 6,672 in the first two years.

Lastly, the funds for the expansion works were raised from loan financing from the Zambia National Commercial Bank Plc (ZANACO) and through a public share listing on the Lusaka Stock Exchange (LuSE).

Mr Mwango: Madam Speaker, I would like to know how much more land Zambia Sugar Company Plc has for the expansion of sugarcane fields in Mazabuka.

Mr Machila: Madam Speaker, I stated, in the response, that Zambia Sugar Company Plc had planted an additional 10,422 hectares. The source of this land comprises about 6,000 hectares from various commercial farmers in the locality, 3,000 hectares from Zambia Sugar Plc itself and about 1,000 hectares from small growers. It is expected that should there be need for further expansion, Zambia Sugar Plc may enter into additional arrangements with other commercial farmers and small growers. In addition, it may be possible that the company may access some land, if available, through the traditional leadership in the area.

Dr Scott (Lusaka Central): Madam Speaker, the hon. Minister’s answer confirms what we have often been told that Zambia is a very efficiently low-cost producer of sugar, no doubt, in part, because they do not have to pay for the water or clean the water which they put back in the Kafue River. Would the hon. Minister comment on the allegations that appeared recently in the press to the effect that the price of sugar to the Zambian consumer is more than double the cost of production, especially in view of the fact that on his desk, as hon. Minister of Commerce, Trade and Industry, there is a report from the Zambia Competition Commission confirming this allegation?

Mr Machila: Madam Speaker, I am not in possession of that information and, therefore, I am not in a position to answer and risk misleading the House. I thank you, Madam.

Mr Nkombo (Mazabuka Central): Madam Speaker, such an expansion as per description by the hon. Acting Minister of Commerce, Trade and Industry, in my view, must bring benefit to the general well-being of the people of the district of Mazabuka. I want to know something, considering that the hon. Acting Minister was in the company of the His Excellency the President, a few weeks ago, when he visited Mazabuka. The Mazabuka District Business Association complained bitterly and deleged that there was no economic benefit the Zambia Sugar Plc serves to the business houses after the expansion owing to the fact that the business is being chaired by one or two tycoons...What is the benefit that the local business community got from the expansion of Zambia Sugar which a common eye cannot see?

Mr Machila: Madam Speaker, we missed the presence of the area hon. Member of Parliament when we visited Mazabuka with His Excellency the President. Madam Speaker, there are some issues that were raised by the business community in Mazabuka relating to Zambia Sugar Plc and those matters are still subject to various interactions and discussions. I think it will be inappropriate for me, at this stage, to make any further comment. I thank you, Madam.

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