The Zimbabwean government has initiated plans to construct a new sugar milling company in the Lowveld region, following unsuccessful attempts to acquire the country’s leading sugar estate, Tongaat Hulett, sources from NewsDay Business reveal.
Last year, South Africa-based Tongaat Hulett faced financial turmoil, necessitating business rescue operations after accruing debts of around R7 million due to an accounting debacle.
In a twist this July, the appointed business rescue practitioners disclosed their intentions to divest Tongaat’s operations, including those in Zimbabwe, to Tanzania’s Kagera Sugar. However, the Zimbabwean government reportedly attempted to secure the estates via the Sovereign Wealth Fund, now known as the Mutapa Investment Fund.
A recent public statement from the Ministry of Industry and Commerce sought participation from both domestic and international investors to establish a fresh sugar milling enterprise in the Lowveld area.
“This initiative aims to support a growing number of regional farmers seeking milling alternatives,” the ministry’s invitation highlighted. The government has expressed its readiness to review incoming proposals for this venture.
According to a report by Newsday Zimbabwe, Tongaat Hulett’s businesses, including Hippo Valley Estates, represent over half of Zimbabwe’s sugar production capacity.
In partnership with Tongaat and local financial institutions, the Zimbabwean government has embarked on Project Kilimanjaro, aiming to cultivate approximately 4,000 hectares of new land for sugar farming. The government is responsible for selecting eligible cultivators for the project.
Dahlia Garwe, Hippo Valley Estates’ Corporate Affairs Executive, informed Standard Business, an affiliate publication, that the company has handed over Project Kilimanjaro’s land to the government.
“While we await further developments, the land allocation process by the government is complete, and the selected farmers will be notified promptly,” Garwe stated.
Garwe confirmed that Hippo Valley Estates will collaborate with the government to ensure the land’s development and provide expertise to the resettled farmers.
