* Recruited 2,500 seasonal workers to necessitate smooth operation when it commences production of sugar
* The company has been undergoing reformatory processes after termination of its contract with Aum Sugar Co. Ltd
By Fostina Mkandawire MANA
Salima Sugar Company Limited has assured that Malawians should expect benefit from its product unlike in the past, saying they “are changing how business was run, to produce a commodity that will be available across the country and should be well known on the market”.
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This was pledged on Tuesday at the company’s premises during the official handover of a small-scale farm to Salima Sugar Company as an operator and the signing of a management agreement between the company and Lingadzi Cooperative in the district.
It was revealed that Salima Sugar Ltd has recruited 2,500 seasonal workers to necessitate smooth operation when it commences production of sugar on April after closing in November 2023.
Greenbelt Authority Board chairperson, Wester Kosamu said at the moment the company has been undergoing reformatory processes after termination of its contract with Aum Sugar Co. Ltd.
Kosamu
Kosamu said they have issued distributorship licenses to eligible business people to start distribution of the commodity soon after production commences.
He said in the past there was widespread concerns about availability of sugar produced in Salima on the market, therefore they have taken strategic steps to ensure that once production commences the commodity would be available across the country.
“Distributorship contracts are a key strategy aimed at ensuring that the country has a sufficient supply of sugar and effectively addressing the ongoing sugar crisis,” he said.
“We anticipate more than 200 small-scale sugarcane farmers under Lingadzi Cooperative to get more profits from their farming activities based on the fact that they will now have the opportunity to negotiate the sale prices of their sugarcane with the company.”
Senior Chief Khombedza said prioritizing local communities would assist in bringing sanity in his area and instill a spirit of ownership in surrounding communities not to destroy the farm or encroach the land.
“There was growing tension between surrounding communities because they were not benefitting as anticipated from the company,” he said.
“Therefore, they were becoming violent at times as the farmers lacked the chance to negotiate sugarcane prices as a result getting prices below their expectation.”
Lingadzi Cooperative Chairperson, Yohane Msalira said members of the cooperative could now look forward to better negotiated prices for their sugarcane, leading to improved financial prospects and livelihoods.
With a landholding of around 500 hectares, Lingadzi Cooperative aims to make a significant contribution to Salima Sugar Company’s production activities.
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In November 2012, the National Assembly passed the Export-Import Bank of India (loan authorisation) Bill, allowing the Ministry of Finance to borrow the sum of US$76.5 million from the India Exim Bank to finance the development of irrigation network under the Greenbelt Initiative, setting up a refined sugar processing plant in Salima.
In 2015, government incorporated the Greenbelt Initiative Holdings Limited as a wholly state-owned enterprise and in 2022, the shares in GBI Holdings Limited were transferred to the Greenbelt Authority.
Government identified AUM Sugar & Allied Limited (AUM SAL) as a potential partner and established the Salima Sugar Company Limited joint venture in 2015, with a 60% ownership by AUM SAL and a 40% ownership by Malawi Government.
Last year, it was revealed that the government lost huge huge sums of money about US$30 million but by December 7 the Attorney General Thabo Chakaka Nyirenda assured Malawians that his office was working on recovering it and bring to book the perpetrators involved in the Salima Sugar Company Limited corruption.
Chakaka Nyirenda assured this at Capital Hill in Lilongwe when he briefed the media on the forensic audit report on Salima Sugar, which revealed rampant mismanagement and misuse of resources at the company, saying over US$30 million has been misappropriated by the company through various dubious deals for the past years.
Attorney General Thabo Chakaka Nyirenda
The AG said his office was taking swift and decisive action to recover the stolen funds, adding that investigators, prosecutors and legal experts are working to uncover corruption and financial wrongdoing at the company.
He also disclosed that some company officials, civil servants and other government officials are part of the scheme, saying the law will be applied for such individuals.
“Audit Consults who were appointed as forensic auditors found that Salima Sugar Company Limited was dealing businesswise with related and suspicious companies incorporated in foreign countries, in particular India, United Arab Emirates-Free Zone Area, Seychelles and South Africa.
“Additionally, a senior officer incorporated Salima Sugar Company Limited in Dubai without the knowledge of the Malawi Government. A bank account in the name of Salima Sugar Company Limited was opened in Dubai.”
The AG also said although Malawi’s Exchange Control Regulations require prior Ministerial or Reserve Bank of Malawi approval before a person acquires a foreign loan or foreign currency-dominated loans, Salima Sugar never obtained prior approval to enter into foreign loans from foreign companies.
He also said although sugar is an important export commodity, no foreign export earnings have been declared by Salima Sugar, emphasizing that “Government has not benefited from forex revenue that Salima Sugar has been earning through exports despite huge investment and profits the company has been generating.
“This is a hindrance to the economic development of the country,” said Nyirenda adding that the Government was currently paying back debts which the company obtained from various institutions without the company’s board’s approval from government.
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