KHARTOUM (Reuters) - White Nile will open a $1.1 billion sugar factory in Sudan next year, which will make the country self-sufficient on the key commodity by 2012, the company’s general manager said on Sunday.
White Nile sugar company will reach initial capacity of 250,000 tonnes by November 11, 2011, and be fully operational at 450,000 tonnes by 2012, Hassan Satti said in an interview with Reuters on Sunday.
Kenana sugar company holds a 30 percent share in White Nile and other shareholders include the government of Sudan and Egyptian investors.
Satti said about two-thirds of the funding for the venture has come from loans from Middle Eastern funds or banks and the remaining third from Sudanese banks.
He also said the company was close to signing a deal with a Chinese company to build a 60 million litre ethanol plant and 100,000 tonne animal-feed plant which would be opened alongside the factory.
“At full capacity, the White Nile (sugar company) will produce 450,000 tonnes (a year) which definitely will cover the local consumption,” Satti said.
Sudan’s sugar consumption is around 1.2 million tonnes a year and production is about 800,000 tonnes, Satti said, adding that when the plant is at full capacity, Sudan will more than meet domestic needs and there will be a small amount of exports still heading to the European Union.
He said the project had full cash flow for 12 years post construction.
“We have soft loans from Arab organisations (the interest on) which is very, very low between 3 to 5 percent ... but at the same time you have commercial rates which goes into 9 to 10 percent but the overall weighted average is about 7 percent,” he said of the interest on the loans.
Sudan has privatised most of its industries, beginning in the 1990s, but the government still retains control over many sectors by issuing licenses for import and export in Africa’s largest country by land.
Satti said the White Nile project was part of a larger plan for Sudan’s sugar industry which, if implemented, could see it service markets throughout Africa and the Middle East.
With U.S. economic sanctions imposed since 1997, Sudan has had to look east to China, India and Thailand for help on its sugar development.
Satti said the embargo only posed a problem on some financial transactions but had not affected the project.