Ethiopia Building 10 New Sugar Factories to Become Leading Exporter

by yeEthiopiaforums

(Bloomberg) — Sugar Corp., Ethiopia’s state-owned producer, said it started building 10 new factories and is inviting private investment as part of a plan to become one of the world’s 10 biggest exporters of the crop.

The project, which has raised concern among environmental activists, involves constructing plants and establishing farms at a cost of about 80 billion birr ($4.6 billion) in four regions in the Horn of Africa country, Abay Tsehaye, director general of the Addis Ababa-based company, said in an interview on Sept. 7. The government is undertaking the work because Ethiopian private firms are “not financially and technically ready to do such huge enterprises.”


“The government has given focus to sugar development. In the coming 15 years, we hope to be one of the top 10 exporters,” Abay said. “The reason we have this target is Ethiopia has big potential in terms of climate and in terms of soil and water resources, which is very favorable for sugar production.”

Ethiopia, Africa’s biggest coffee grower, unveiled a five- year plan in December that targets annual economic growth of as much as 14.9 percent by expanding agriculture and boosting savings to fund investment. The plan aims to transfer 3.3 million hectares (8.2 million acres) of land to investors by mid-2015.

Foreign investment is being sought to develop other projects on 5 million hectares of land that has been identified for sugar production, Abay said.

“Many are coming and asking because they know the potential of Ethiopia, they know the favorability of climate, soil and availability of cheap land,” said Abay, a former national security adviser.

Sugar Imports

Ethiopia imported 150,000 metric tons of sugar last year. The government aims to become self-sufficient in the crop by the end of 2013 and increase production almost eightfold to 2.3 million tons by mid-2015, leaving a surplus for export of 1.25 million tons, according to Abay. The world’s tenth-largest producer in 2009, the U.S., grew 27.5 million tons, according to the United Nations’ Food and Agriculture Organization. >> Read More on Bloomberg

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