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Regional Economic Giant Ventures into Sugar Production

The plant will be located in the Amhara Regional State

Mar 16 , 2019
By TEMESGEN MULUGETA ( FORTUNE STAFF WRITER )

An economic wing of the Amhara Regional State is expanding to sugar production with an estimated investment of 1.4 billion Br.

Abay Industrial Development SC plans to set up a sugar manufacturing plant at Tana Beles sub-basin in the Amhara Regional State. The factory will have a capacity of crushing 8,000tn of sugar cane a day, and there is a plan to expand to 12,000tn of sugar cane. The project will include a sugarcane plantation development, processing complex and a power co-generation facility.

For the project, Abay, a public-private partnership with four billion Birr in registered capital raised from about 516 investors and state-owned enterprises in the Amhara Regional State, is in the process of hiring a firm to carry out the feasibility study.


A tender for a consultancy firm was also floated late last month by Abay, a company established to develop 22 different industries in the region including steel, cement, fertiliser, textiles, chemicals and commercial farming.

There are eight local sugar factories that are operational in the country including Wonji Shoa, Metehara, Fincha, Tendaho, Arjo Dediessa, Kessem and Omo Kuraz  Sugar Factory II. Excluding Omo Kuraz II, the seven factories have an annual production capacity of four million quintals, while the demand is between 6.5 million quintals to seven million quintals.


To meet national demand, Ethiopia imported 4.14 million quintals or 414,587tn of sugar two years ago.


Last year, Prime Minister Abiy Ahmed (PhD) inaugurated Omo Kuraz III Sugar Factory, located in the Bench Maji Zone of the SNNPR built at a cost of more than eight billion Birr. The factory became the eighth operational sugar factory in the country. Built by the Chinese company COMPLANT, it has a capacity of producing 8,000 quintals to 10,000 quintals of sugar a day.

Close to 34.8 billion Br was spent for the four sugar factories in Omo Kuraz Sugar Development Project for irrigation infrastructure, land preparation, sugarcane development, housing, factory construction, project pre-operation and operational budget by March 2018.

The growth in sugar factories will not only minimise the shortage of sugar but make a major contribution to saving forex spent to import it, according to experts. That the project is not solely government-owned has also been hailed.


"It is good that the private sector is stepping up, but the government should take care to keep the price of sugar down," said Alemayehu Geda (Prof.), a macroeconomist and university lecturer at Addis Abeba University. "The government will also have to improve the current sugar producing capacity of the publicly-owned sugar factories."

Abay is also in the process of setting up the nation's largest steel cold rolling mill complex in Bahir Dar. It also plans to set up a cement factory at Dejen, 240Km northwest of Addis Abeba, two furniture factories in the cities of Debre Tabor and Debre Berhan and a textile factory in Gonder. It also laid the foundation for a one-billion-Br wood mill plant to be located in Woldiya town, Amhara Regional State.

Demes Teshager, general manager of Abay Industrial Development, did not respond to questions from Fortune before the paper went to print.


PUBLISHED ON Mar 16,2019 [ VOL 19 , NO 985]

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