OBASANJO AND SIMUNYE SUGAR MILL
DR Sishayi Nxumalo once told me of a very interesting story about the establishment of Simunye Sugar Mill. The formation of the Royal Swaziland Sugar Corporation (RSSC) Ltd was started in 1973, when Tibiyo Taka Ngwane, working in close cooperation with the Commonwealth Development Corporation (CDC), carried out a pre-investment study for the expansion of sugar production. The results of the pre-investment appraisal prompted a final planning and development study for a completely new project - the third mill. This was entrusted to Tate and Lyle Technical Services Limited (TLTS) and completed in June 1975.
At the same time the Swazi (Eswatini) Government and Tibiyo TakaNgwane entered into a wider partnership with the Tate and Lyle Group to bring the project into being. On October 7, 1978, His Majesty King Sobhuza II, OBE, Ngwenyama of Swaziland, dedicated the Swazi Third Sugar Mill ‘Simunye Sugar Estate - We are one’ - which culminated in five years of intensive planning and negotiation to implement another major increase in sugar production in Eswatini. By May 1, 1979, The RSSC, sole proprietors of Simunye Sugar Estate (SSE), was created by seven partners signing a joint venture agreement with government and Tibiyo Taka Ngwane in December 1977, to subscribe E40.1 million of equity share capital. This was subscribed by October 1978.
President Obasanjo to the rescue
Loan capital amounting to approximately E64 million was made available by government, Tibiyo Taka Ngwane, CDC, DEG, IFC and the European Investment Bank (EIB). The final investor’s conference was held in Zurich, Switzerland and everyone was excited as it was now only formalities since all agreements we were in place. On the morning of the main meeting after full presentation of the Simunye Project, CDC representative suddenly requested an opportunity to address the meeting. CDC has had the most experience in Eswatini through their ownership of Mhlume Sugar Mill. Dr Sishayi Nxumalo, the chairman had no problem offering them that chance.
He says it was about 11:30am and spirits were high, when the CDC representative started to speak, and to his shock the CDC representative cast serious doubt on the viability of the project and pulled out, which created a shortfall. Realising the British sabotage afoot, he privately asked one of his top officials, Tim Zwane, to step outside and return and whisper something in his ear anything.
When Zwane returned and whispered in his ear, he immediately asked to adjourn the meeting as an urgent message had come in from His Majesty King Sobhuza II, stopping the British saboteur dead on his tracks. He called for an early lunch, and for the meeting to resume at 2pm that afternoon. Dr Nxumalo went back to his hotel room and said his head was spinning as he realised that the Simunye Sugar Mill project, which had cost so many years and hard work, was about to collapse. He managed to place a call home, to His Majesty King Sobhuza II, to inform him of the sudden turn of events and asked for advice, but the King only said ‘musa waMqcobeya bona kutsi wentani kepha ubuyenayo, ngiyakwetsemba’. (Son of Mqcobeya do whatever you can, but come back with the project, I trust you) and put the phone down.
He then scrambled through his business card book for anyone he could call to save the deal within the two hours that he had. The disappointed look on the faces of the other international investors and funders flashing vividly in his mind after the presentation by the British CDC gave him a dreaded feeling that the deal was dead. For some reason, Dr Nxumalo had met with the Nigerian General, Olusegun Obasanjo, before he became president and he had his personal business card and requested a direct call to him.
Luckily, he did get through to President Obasanjo, who did not hesitate to invest even without any knowledge of the project, but to support a fellow African in need. The Nigerian Embassy in Zurich was soon made aware of the project. At 1:55pm, he said he was pacing up and down the lobby of the hotel, not sure what to expect as he had not received any feedback from the president. Dr Nxumalo described a scene which almost brought him to tears. At about 2pm, a team of 10 Nigerians, adorned in their usual regalia, stormed the lobby oozing confidence with one instruction, which was to get to the conference room and buy any shares available. All attempts to take them to a private conference room for a briefing failed, as they were there to secure equity - period.
When the meeting resumed, he instructed the CDC representatives to leave the conference room if they were no longer interested in investing, as new investors were ready to take his equity. The Nigerian delegation leaders confidently informed the meeting that they had studied the documents of the Simunye project and were ready to invest - if anyone wished to pull out, they were welcome and they would take all their equity that very moment. That is the reason the Nigerian Government remains part of the Simunye shareholders to this day. CDC was simply looking out for their own Mhlume Sugar Mill and were willing to kill a project that changed the economy of Eswatini. Dr Sishayi told me of many other such stories of successes and sabotage in the building of our economy.
The reality was that CDC had been with the project from its inception, but never intended to see it through, and the Nigerian president had the foresight to take a decision within one day, which saw the establishment of a great project. In 1980, the Simunye Sugar Mill was commissioned, initially capable of producing 120 000 tonnes of sugar per annum. It was subsequently expanded in year 2000 to accommodate cane purchased from new schemes of independent cane farmers. As the drive for our Industrialisation intensifies, there are forces who do not have the interest of emaSwati at heart, but their own agendas. They don’t particularly hate emaSwati, but they want us to remain under their control at all times and anything that seeks to give us economic freedom, they quietly destroy. We must look out for the ‘Re-colonisation Agenda’. Thank you President Olusegun Obasanjo. Comment septermbereswatini@gmail.com
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