Times Of Swaziland: MOZ UNREST IMPACTS ESWATINI SUGAR INDUSTRY

MOZ UNREST IMPACTS ESWATINI SUGAR INDUSTRY
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Nhlanganiso Mkhonta on 29/11/2024 09:14:00


MBABANE – The political unrest in Mozambique has significantly impacted the
Eswatini sugar industry in terms of transportation of products to overseas
markets.
This challenge was highlighted by the Eswatini Sugar Association (ESA) Financial
Director Andrea Mendes during the International Finance Corporation (IFC) and
Business Eswatini (BE) Private Sector Day held on Wednesday. Mendes said due to
the political unrest in Mozambique, the local sugar industry has been impacted,
as they had to find alternatives to export sugar to the international markets.
It is worth noting that ESA exports locally-produced sugar to the United States
of America (USA) through the Mozambican sea ports.
Violent protests have wreaked the southern African country of Mozambique after a
disputed national election in October. Electoral irregularities and claims of
vote rigging have led to what human rights activists have called
State-sanctioned oppression and human rights violations. More than 40 people
have been killed in post-election violence so far. Mendes said this political
unrest and other geopolitical conflicts have caused disruptions in the supply
value chains not only to the sugar industry, but also across many other sectors.
The financial director stated that other challenges faced by the local
agricultural sector include the rise in farming inputs and fuel costs. She added
that climate change has also caused significant disruptions, as yields have
significantly dropped. She highlighted that sugar cane yields have dropped by at
least 21 tonnes per hectare, which is a huge number. She said under the climate
change challenge, farmers are struggling to get their crops insured. She said,
however, of late there has been some slight improvement in this space as
insurance providers are reporting an increase in uptake of insurance covers.
She said climate change has also caused disruptions in the distribution of
rainfall, leading to a drop in the availability of water. She said when it is
expected to rain, there is no rain but extreme heat and storms here and there.
She said storms cause so much havoc, as they destroy crops. Mendes added that
another challenge faced by farmers is adherence to sustainable standards, as
consumers are now on high alert for what they consume. She added that another
big issue faced by farmers is funding.
Meanwhile, EswatiniBank Managing Director (MD) Nozizwe Mulela spoke about the
challenges faced by micro, small and medium enterprises (MSMEs). Mulela said the
biggest of them all is the access to finance by the MSMEs. She said it is
important to look into this challenges’ root cause, which is failure to meet
stipulated requirements. The MD said as banks, they admit that the requirements
are often a stumbling block for some MSMEs. She said, however, the requirements
are a must before granting any loans.
Financial
Mulela then pleaded with institutions like the World Bank to come in handy and
assist the local financial institutions by bringing the necessary funding that
can then be distributed to the MSMEs. She said the available funds are often not
enough to support the MSMEs sector, hence the need for support from the
international bodies. Meanwhile, the World Bank Group has reaffirmed its support
for the growth of Eswatini’s private sector, particularly in sectors like the
agribusiness sector.
This commitment was made by Mehita Fanny, the International Finance Corporation
(IFC) Country Manager for Comoros, Eswatini, Madagascar, Mozambique and
Seychelles. Fanny made her remarks during the IFC private sector day held under
the theme ‘Inclusive Growth: Enabling Sustainable Private Sector Growth in
Eswatini.’ The Private Sector Day is the culmination of years of collaboration
and research between the World Bank and Eswatini, and it serves as a platform
for dialogue, exchange and partnership.