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Wednesday, 6 April 2011

Investment Watch (Sugar & Bio-ethnol)

South Africa's AGZAM Project Developers Ltd plans to build a $US251 million sugar and bio-ethanol plant, one of the largest non-mining investments in recent years. According ZDA, "The company will produce 200,000 tonnes of sugar and 28 million litres of bio-ethanol per year...Production is expected to start by 2013 and we expect that the project will create around 4,000 jobs". The company will cultivate about 15,000 hectares of cane sugar in Kazungula and support about 3,000 hectares of plantations by out-growers. It is thought that once completed, it will increase Zambian sugar production by 50 percent which should be good for export revenues. Domestically this looks like good competition for Zambia sugar.  But the scale of land involved seems huge. Presumably some chiefs have struck a bargain somewhere.


  1. We need more information on this land grab. Presumably there is no community trust, no trust fund, and the chiefs are trousering funds for having alienated their own people's land. What these chief's do not appreciate is that they have an opportunity to survive into the future by ensuring that their people benefit from their customary commons. If they do not benefit, and continue to be disenfranchised, they will one day remove their chief.

  2. The land is not going to be shipped out. It just happens that someone is going to make economic use of it. Kazungula district is crying out for development. This is the first economic project in the district. A district that is so unfortunate that it is administered from Livingstone!

  3. " If they do not benefit, and continue to be disenfranchised, they will one day remove their chief. "

    There is nothing to like about this deal. Why does Zambia Sugar need competition from a giant South African transnational corporation?

    Who gives away 15,000 hectares (12km x 12km or 7.6 miles by 7.6 miles)?

    What are the terms of investment? Is this a deal that the MMD pushed through before they have to leave office?

    How many people are going to be thrown off their land to make way for this South African transnational corporation?

    By the way, this is not a good way to ensure 'competition' for Zambia Sugar. If it is a monopolist, just break it up legally. For instance, by turning it's divisions into separate companies. Or delimiting it's territory by province (Zambia Sugar Lusaka, Zambia Sugar Western Province, etc.).

    If competition is the issue, it makes no sense to invite a foreign corporation, allowing for more money to be dragged out of the Zambian economy and expatriated to South Africa.


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