Tanzania makes U-turn on latest sugar imports ban

Tanzania has again backtracked on its decision to ban sugar imports, a week after freezing issuance of permits.
Mr Japhet Hasunga, the Tanzania minister of Agriculture, told journalists last week that government was now contented with plans by manufacturers to produce more sugar.

“We are now satisfied with the companies’ strategic plans to increase sugar production. That is why we have decided to allow them to supply and import sugar for domestic consumption,” he said.

About a week ago, Mr Hasunga had accused manufacturers of importing “sugar very fast, overlooking their role of producing”.
The freeze, he said, was intended to force manufacturers to concentrate on production, claiming that the country had enough stocks to sustain demand until May.

Tanzania produces about 320,000 tonnes of sugar against a national annual demand of 670,000 tonnes.

Mr Hasunga said government would issue permits to non-sugar producing companies from June to bridge the gap, expressing optimism that sugar output would increase once Mkulazi Sugar, owned by two pension schemes in Tanzania and Bakhresa Group’s Bagamoyo factory with capacity to produce 250,000 tonnes and 100,000 tonnes, respectively are complete.

Last year, Tanzania banned Ugandan sugar traders from its market, claiming that they were importing cheap sugar from Kenya and Brazil, before it is repackaged and exported to Tanzania.

The Tanzania government, in the process, slapped a 25 per cent Excise Duty on Sugar that had been exported by Kakira Sugar Works, which was later returned to Uganda.

Negotiations to lift the 25 per cent duty on Ugandan sugar has been ongoing amid mixed policy directives.

In December last year, Trade Minister Amelia Kyambadde, said they had not been furnished with clear reasons why Tanzania, had withdrawn sugar import permits it had started issuing in December 2018.

However, the ban was later suspended in January, before it was reinstated and then lifted just in the last two weeks.

MANPOWER
In December, Tanzania had lifted the ban on sugar imports and other agricultural produces from Uganda. But the country’s government about a week ago stunned traders with a new ban that has since been lifted, though temporarily, according to some experts.