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$200m sugarcane project launched
By ANGELA CHISHIMBA
 

PRESIDENT Mwanawasa yesterday launched the Nakambala sugarcane expansion project estimated to cost US$200 million. President Mwanawasa said the expansion project had put Zambia in the league of the major sugar producers in the world.

“It is good that Zambia will not only be known by its production of copper but sugar as well,” he said.

The project would expand the country’s sugar exports mainly to the European Union.

He said the project would ensure increased income and creation of more jobs.

The President said the production of ethanol by Zambia Sugar would also help reduce the import bill for petroleum.

He was confident that most of the US$200 million to be pumped into the expansion programme would come from Zambian banks, which would in turn derive profits out of it.

Mr Mwanawasa urged Zambians to position themselves and ensure they benefited from the project.

He appealed to the Zambia Sugar management to continue supporting indigenous Zambians in order to support the Citizens Economic Empowerment Act.

He urged management to assist local people to take advantage of business opportunities that may arise following the launch of the expansion programme.

He was glad that Zambia Sugar Company decided to invest in Zambia at a time when most investors feared to invest in the country.

He said Zambia was an investor-friendly country.

He paid tribute to traditional leaders in Southern Province for releasing land to put up the Albidon Nickel Mining and Zambia Sugar expansion projects.

Mr Mwanawasa also urged investors to pay attention to concerns of local communities.

“Investors should ensure that they take the owners of the land on board,” he said.

President Mwanawasa also held a meeting with the company to discuss labour matters.

He could not, however, disclose what had been discussed.

And Zambia Sugar managing director, Paul de Robillard, said the sugarcane expansion project was approved at a cost of K840 billion on March 28, 2007.

The project is based on a 50 per cent increase in cane crushing capacity of the factory, linked to expanded sugar cane growing and the construction of new canals to deliver irrigation water to new areas of sugarcane development.

The project will also result in Zambia Sugar becoming fully self-sufficient in its own electricity requirements.

Mr de Robillard said the anticipated growth in production would come from a combination of Zambia Sugar’s own estate operations, commercial out-growers and small-scale grower schemes, both new and existing, totalling 10,500 hectares.

He said the first phase of the expansion had started and would be completed in time for the sugar season in April 2008.

Mr de Robillard said as an alternative market, the unrestricted European market access entitlements for least-developed countries (LDCs), including Zambia, to be effected in 2009, would provide a minimum underpin price for the increased production.Under the EU reformed sugar regime, the price for bulk raw sugar would be guaranteed at a level that is 33 per cent lower than the existing price.

Mr de Robillard said the unrestricted nature of this initiative for sugar exporters in LDCs would also enable Zambia access the full value chain existing in the EU sugar market.

This would open opportunities to earn commercial premiums currently not available to exporters due to the EU’s restricted quota system.

He said molasses production would increase to 95,000 tons by the end of the project and at that stage, a feasibility study to investigate the production of alcohol for national fuel pool would be undertaken.

“It is envisaged that if viable, an ethanol plant would be able to supply approximately 10 per cent of the country’s fuel requirements,” he said.

Source: Zambia Daily Mail

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br-01-2.jpgRio Tinto is eyeing Zambia according to Business Week’s latest topical issue … the sole owner of the world’s largest open pit mine located in Kennecott Utah in the United States of America and, one of the leading mining companies in the world, which employs 34,500 people in 40 countries is looking at Zambia with a critical eye.

Rio Tinto’s worldwide operations supply a wide range of minerals and metals, including gold, silver, coal, iron, aluminum, borates … and, of course, copper.Copper remains the biggest money spinner, generating 48% of Rio’s profits in 2006. Some experts expect that portion to fall to about 30% in the next few years as prices come off their highs. Iron ore, which accounts for about 30% of profit currently, will become an increasingly important part of the mix, thanks to China’s voracious demand for steel.

Rio Tinto has poured money into acquisitions and new exploration projects to sustain growth. Last year alone, Rio boosted capital investment by 56%, to $3.6 billion, helping it secure the No. 3 spot on this year’s BW50 list of top European companies. It has become one of the titans of the mining industry, second only to Anglo-Australian rival BHP Billiton (BHP), with interests in copper, iron ore, coal, uranium, and diamonds.

Experts estimate the high commodity prices—which so far show no sign of tumbling—could give the company a net cash balance of about $4 billion by the end of 2008. That gives it a lot of firepower for more deals. Russia, Zambia, and the Congo are all regions where Rio could make a move next …

A look at the company’s selected financial data and revenues shows that it’s consolidated annual revenues for fiscal year 2006 exceeded $25.4 billion, with EBIT (earnings before interest, taxes, depreciation and amortization) at $12.7 billion while capital expenditure was well over $3.9 billion. Margins underlying/adjusted earnings before interest and taxes stood at 42.2% as a percentage of gross sales and they have consistently reduced their net debt down to $11.1 billion from $41.1 in just four years.

The real question however is whether the government responsible for the Zambian Enterprise will take advantage of the above spending power and do all they can to make sure Rio Tinto comes through with their considerations – thereby making Zambia a fortress for FDI (Foreign Direct Investment) it should be … thanks a trillion 

Brainwave R Mumba, Sr. 

CEO & President – Zambian Chronicle 

Copyrights © 2007 Zambian Chronicle.  All rights reserved. Zambian Chronicle content may not be stored except for personal, non-commercial use. Republication and redissemination of Zambian Chronicle content is expressly prohibited without the prior written consent of Zambian Chronicle. Zambian Chronicle shall not be liable for any errors, omissions, interruptions or delays in connection with the Zambian Chronicle content or from any damages arising therefrom.

Zambian Chronicle is a wholly owned subsidiary of Microplus Holdings International, Inc. 

Copyrights © 2007 Microplus Holdings Int., Inc.   

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Intra SADC trade for the fiscal year 2006 was worth $1.3 billion to the Zambian Enterprise meeting and exceeding expectations above and beyond envisioned thresholds. A phenomenal growth of well over 56.15% from the previous year of $730 million.  Intra-SADC trade needs to be even more encouraged especially that it generates such huge export parities for our enterprise; and we did all this without any help from North Korea.

This shows that what we had been talking about for years and since been enacted into law under the Zambia Development Agency (ZDA) Act is workable as can been seen in these results because of focusing on value-addition to locally manufactured products to create jobs and wealth. 

Under the Zambia Development Agency (ZDA) Act, the Government has proposed various incentives to attract investments that include zero per cent tax rate on dividends for companies operating in the priority sector and/or MFEZ under the ZDA Act for a period of five years from the year of first declaration of dividends. 

Even before the Act came into being, we focused on this at the old forums (insaka) provided for by my good friend the virtuous Chanda Chisala; strictly evaluated the pros and cons with the likes of splendid Bwana as well as brainiacs like the famous Pimbilimano. The Act was formed and the results are here for all to see … thanks a trillion.

Brainwave R Mumba, Sr. 

CEO & President – Zambian Chronicle 

Copyrights © 2007 Zambian Chronicle.  All rights reserved. Zambian Chronicle content may not be stored except for personal, non-commercial use. Republication and redissemination of Zambian Chronicle content is expressly prohibited without the prior written consent of Zambian Chronicle. Zambian Chronicle shall not be liable for any errors, omissions, interruptions or delays in connection with the Zambian Chronicle content or from any damages arising therefrom.

Zambian Chronicle is a wholly owned subsidiary of Microplus Holdings International, Inc. 

Copyrights © 2007 Microplus Holdings Int., Inc.