• Tuesday, May 28, 2024
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Investors already buying into Nigeria’s $3.1bn Sugar Master Plan

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sugarbag1Latif Busari, executive secretary, National Sugar Development Council (NSDC), says investors are already buying into the National Sugar Master Plan, which requires investment drive of $3.1 billion.  With their positive responses so far, the sugar industry has been positioned as key component to Federal Government’s economic diversification programme.

Busari, while explaining Federal Government’s effort to drive the needed economic growth through the sector in Abuja, said: “The Federal Government has provided concessionary tariff of 5 percent duty and 5 percent levy for key players in the Sugar Master Plan to encourage them, and specifically for raw sugar importation, since Nigeria has the capacity to refine 3 million metric tons of raw sugar as well as create jobs in the value chains.

“Already, Dangote Sugar master plan is projecting to invest $2 billion in the sector. The money is meant for sugar development, and field and factory development. The $3.1 billion is what you need to put sugar down to production, and we expect the investment drive to come from the private sector, which we are already seeing their response.”

The Federal Government initiated the National Sugar Master Plan in order to reduce sugar importation and drive local production, and in turn drive programmes that promote electricity generation through the use ethanol, along side generation of job along the value chains.

Analysts believe that the diversification of the economy through areas that the country has competitive advantage, such as sugar, could spark off the much-touted move away from the oil sector as being projected by the government.

By the year 2020, Nigeria will be consuming 1.7 million metric tons of sugar annually, and the executive secretary has assured of the Federal Government working closely with the private sector to close the gap with the plantation of 250,000 hectares of land under sugar cane cultivation.

“If we keep up with our private sector collaboration, we would be able to produce 116 million litres of ethanol that could generate over 400 megawatts of electricity and we would save $400 million from sugar importation annually.

“We expect that our backward integration refineries should be able to source their products locally from factories locally. Nigeria currently has 3 million metric tons refining capacity for sugar. The three major players in the sector are: The Dangote, Bua, and Golden sugar refineries. The three of them have shown capacity to produce 700,000 metric tons of sugar,” according to the executive secretary.

On supporting local investors with incentives, he said: “The Federal government has introduced quota importation to ensure protection for local investors, as against cheap importation. This creates incentives for investors that had invested into the country.

“There is also a strategy to hike tariff for those that import refined sugar since our major players in sugar has shown capacity to refine raw sugar, we are adding value in the chains for job creation, since absolute importation means job creation,” he said