It is six decade plus years ago since Ethiopia first acquainted with the sugar industry. Given the ample labor, market, water resource and the favorable climate condition for sugar development, the country has not been benefiting as to its potential.
For long time, the number of sugar factories were limited to three and the total sugar production was not exceeding 300, 000 quintals annually. This has led the country for the importation of two million quintals costing 2.6 billion Birr a year to meet the local demand.
Understating this, the government has been aggressively working to expand sugar industry over the last decade. Expansion works have been carried out in outstanding sugar factories to enhance their production capacity. Also the construction of new sugar factories is well underway.
Recently, while visiting Kuraz I and II sugar factories construction, Prime Minister Hailemariam Dessalegn said the two factories would begin production in two months time and expected to boost the sugar production.
Similarly, the construction of sugar factories is well underway in different parts of the country that was limited to specific areas. Currently, sugar factories are under construction in South Nations, Nationalities and People’s, Tigray , Amahra, Afar and Oromia states. Since the factories consume huge labors and require nearby inhabitants, the factories would help public actively engage and participate in the industry.
According to the Sugar Corporation, nine sugar factories are operating with an aggregate production capacity of seven million quintals in this budget year. As to the recent survey, the total sugar demand of the country has reached 6.5 million quintals annually. This would enable the nation to spend billions of Birr for importation. So good to declare no more sugar importation.
The expansion of various industries that utilize sugar as an input and the fast economic growth are the major driving factors for the increased demand for sugar in the country. Still the share of raw sugar to the total sugar consumption in Ethiopia is 5-6 kg per household while the world average per capita consumption is 21kg in 2016.
Thanks to the sugar revolution in the country, the nation is going to stop importing sugar beginning next Ethiopian fiscal year. Hopefully, Ethiopia would be in a position to export sugar in the coming years as the construction of additional sugar factories are nearing completion.
More importantly, though satisfying the local sugar demand is a big achievement, saving the expense for sugar purchase and moving forward to generate foreign currency would help remarkably to advance the national development.
Certainly, the industry would become self financing and also significant contributor to the over all economy. To this end, lesson has to be drawn from the first Growth and Transformation Plan (GTP I) performance as there are challenges in the second GTP.
Since the industry is in revolution, the major problems that includes lack of capacity, technology,contract management, infrastructure and finance as well as supply of machinery and spare parts need to be addressed strategically.
In order to realize the aspirations to complete 13 sugar factories and make the industry vibrant in the ever improving economy of the country, the government needs to exhaust all possible means to address the hurdles.
Of course the sugar industry has many more benefits, the massive job opportunity and the creation of socio economic benefits for citizens in sugar establishments areas and the economic advantages of bi-products are the major ones. In the first GTP, some 350,000 jobs had been created this number is expected to grow to 600,000 in the second GTP.
Farmers organized in associations have also been engaged in cane production and supply to the factories as a result farmers dwell around project areas are cultivating crops as per their choice. This would help ensure industry peace and sustainable development of the industry.
With all its deficiencies, the sugar industry has emerged as a vehicle for the other industries to contribute their share. The success has come almost in a decade time. The nation is looking for export. However, the industry needs meticulous leadership to further boost the production capacity since the demand of sugar by various industries is alarmingly increasing. Therefore, addressing the problems of the industry strategically undoubtedly make the industry major actor in the overall transformation agenda.
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