KILOMBERO SUGAR COMPANY LTD

1
KILOMBERO SUGAR COMPANY LTD

• GROWING SUSTAINABLE BUSINESS IN TANZANIA

2
A BRIEF INTRODUCTION

• ILLOVO INVESTED IN TANZANIA IN 1998
• 5-YEAR REHABILITATION PLAN
• PRODUCTION INCREASE
• POTENTIAL EXPANSION PLANS 200,000T REFINERY

• SUGAR PRODUCTION - KSC TANZANIA

• 200,000

• 180,000

• 160,000

• 140,000

• 120,000

• 100,000

• TONNES

• KSC

• TANZANIA

• 80,000

• 60,000

• 40,000

• 20,000

• -

• 1990

• 1991

• 1992

• 1993

• 1994

• 1995

• 1996

• 1997

• 1998

• 1999

• 2000

• 2001

• 2002

• YEAR

3
THE COMMUNITY STAKEHOLDERSTHE OUTGROWERS SMEs

• SUGARCANE OUTGROWERS BEGAN IN 1920
• CANE SUPPLY FLUCTUATIONS DUE TO SEVERAL FACTORS

• 300000

• 250000

• 200000

• K1 TONS

• 150000

• K2 TONS

• TOTAL

• 100000

• 50000

• 0

• 1964

• 1967

• 1970

• 1973

• 1976

• 1979

• 1982

• 1985

• 1988

• 1991

• 1994

• 1997

• 2000

• YEAR

4
THE COMMUNITY STAKEHOLDERSTHE OUTGROWERS SMEs

• OUTGROWERS CRITICAL SUCCESS FACTOR TO KSC
  DEVELOPMENT
• BUSINESS PARTNERS
• OVER 4100 REGISTERED FARMERS
• 5,500 HECTARES OF LAND
• 245,000T CANE 30
• 2002/3 OVER TSHS 7.5 BILLION PAID INTO THE
  COMMUNITY

5
OUTGROWER OPPORTUNITIES

• POTENTIAL CANE CAPACITY FOR gt 600,000T
• LAND AVAILABLE
• ENTHUSIASM FOR DEVELOPMENT
• FAIR PRICING STRUCTURE DIVISION OF PROCEEDS
• LOCAL SECURE MARKET
• REGULAR EFFICIENT PAYMENT
• STRONG OUTGROWER NETWORK
• CREATION OF RELATED SUSTAINABLE BUSINESSES
• TECHNICAL SERVICES
• INPUT SUPPLIES
• LOADING AND HAULING
• FINANCIAL SERVICES
• MANPOWER SERVICES

6
MAJOR CONSTRAINTS

• TRAINING
• FINANCE
• TECHNICAL ABILITY
• INFRASTRUCTURE
• COST OF SERVICES

7
WHAT HAS KSC DONE TO ASSIST?

• THE KILOMBERO BUSINESS LINKAGES PROJECT
• THE IFC APDF ARE INTERESTED IN PROMOTING
  COMMUNITY DEVELOPMENT THROUGH ECONOMIC SME
  GROWTH
• THE KILOMBERO AREA PRESENTS A STRONG COMMUNITY
  BASE WITH HUGE OPPORTUNITIES FOR ECONOMIC
  DEVELOPMENT DUE TO THE PRESENCE OF A COMMITTED
  PARTNER
• IFC AND KSC LTD HAVE PROVIDED FINANCE FOR THE
  DEVELOPMENT OF A BUSINESS BASED COMMUNITY PROJECT
  KBLP
• KBLP WILL ASSIST, ENCOURAGE SUPPORT BUSINESS
  DEVELOPMENT ACTIVITIES WITHIN THE COMMUNITY
• KBLP WILL WORK TOWARDS STRENGTHENING LINKS AND
  OPPORTUNITIES AVAILABLE TO THE LOCAL BUSINESSES
  AND STAKEHOLDERS THROUGH ECONOMIC GROWTH.
• KBLP WILL DEVELOP POTENTIAL LINKS BETWEEN THE
  ECONOMIC GROWTH OF THE COMMUNITY AND POTENTIAL
  DONORS OR FINANCIERS

8
KBLP AIMS

• TO ENCOURAGE ASSIST THE COMMUNITY TO MAXIMISE
  THE OPPORTUNITIES AVAILABLE.
• TO DEVELOP THE COMMUNITY THROUGH SUGARCANE
  FARMING
• TO BUILD THE CAPACITY OF THE OUTGROWER SUPPORT
  NETWORK AND REPRESENTATION
• TO INCREASE THE QUANTITY AND QUALITY OF SUGARCANE
  SUPPLIED BY THE OUTGROWERS
• TO INCREASE THE BUSINESS TECHNICAL SKILLS OF
  THE COMMUNITY
• TO CREATE AN ENVIRONMENT THAT WILL FOSTER SMEs
  WITHIN KILOMBERO
• TO CREATE SUSTAINABLE WEALTH WITHIN THE COMMUNITY

9
HOW?

• TRAINING
• TRAINING NEEDS ANALYSIS BY MEDA
• BUSINESS TRAINING
• TECHNICAL TRAINING
• AGRICULTURAL TRAINING
• DAI PESA (USAID)
• FINANCE
• FINANCIAL NEEDS ANALYSIS BY B EYAKUZE
• CRDB / PASS / SACCOS
• RISK MITIGATION COMPANY
• MANAGEMENT INFORMATION SYSTEM
• AERIAL MAPPING
• SMALL MEDIUM ENTERPRISE SUPPORT
• INFRASTRUCTURE DEVELOPMENT
• SWISS DEVELOPMENT CORPORATION / ITECO

10
COSTS

• IFC - 185,000 GRANT
• KSC - 240,000 IN KIND
• APDF - 45,000 TECHNICAL SUPPORT
• TRAINING COSTS - lt 200,000
• INFRASTRUCTURE UNDER SURVEY
• KBLC SET UP TECHNICAL SUPPORT - lt 200,000
• ADF SUPPORT TO ASSOCIATIONS DIRECTLY - 239,000

11
EXPECTED RESULTS OF KBLP

• SUSTAINABLE INDUSTRY AND POVERTY ALLEVIATION INTO
  THE KILOMBERO AREA
• CREATION OF A FURTHER 3,000 FARMERS
• INCREASED YIELDS AND QUALITY INCREASE PROFIT
  PER HECTARE
• CREATION OF JOBS
• CREATION OF SUSTAINABLE SMALL MEDIUM
  ENTERPRISES
• DEVELOPMENT OF A SELF SUFFICIENT COMMUNITY
• DEVELOPMENT OF A STRONG SUSTAINABLE RELATIONSHIP
  BETWEEN THE INVESTOR THE COMMUNITY
• KSC TO CONTRACT OUT NON CORE ACTIVITIES TO
  SUSTAINABLE BUSINESSES
• ROLL OUT EFFECT THROUGH CREATION OF INDIRECTLY
  LINKED BUSINESSES

12
KILOMBERO COMMUNITY TRUST

• FORMED BY ILLOVO / UNITRANS
• TRUSTEES INCLUDE KSC / UNITRANS / LOCAL
  GOVERNMENT
• KILOMBERO COMMUNITY TRUST FARM
• SUPPORT FROM KSC / UNITRANS / BP / KK SECURITY /
  SDC ITECO
• PROFITS FROM FARM INTO COMMUNITY DEVELOPMENT
  PROJECTS
• RURAL ROAD DEVELOPMENT
• HEALTH
• EDUCATION
• OUTGROWER SUPPORT
• ENVIRONMENTAL MAGOMBERA FOREST

13
HEALTH EDUCATION

• KSC OFFERS HOSPITAL AND CLINIC SERVICES TO
  EMPLOYEES AND THE LOCAL COMMUNITY
• CURRENTLY INVESTIGATING OUTREACH HEALTH SERVICES
  TO LINK WITH OUTGROWER EXPANSION
• MOBILE HEALTH CLINICS
• HIV / AIDS AWARENESS
• 5 PRIMARY SCHOOLS / 1 SECONDARY / 1 ENGLISH
  MEDIUM PRIMARY / 7 PRE SCHOOLS
• GAP PROGRAM

14
CONCLUSION

• KSC RECOGNISES THE IMPORTANCE OF THE DEVELOPMENT
  OF THE COMMUNITY THE LINK BETWEEN THIS
  DEVELOPMENT AND THE ACHIEVEMENT OF THEIR
  STRATEGIC PLANS
• KSC RECOGNISES THAT THEIR AREA OF EXPERTISE IS IN
  MAKING SUGAR AND THAT TO MAXIMISE THE DEVELOPMENT
  OF THE COMMUNITY EXTERNAL SUPPORT AND EXPERTISE
  HAS TO BE SOUGHT
• THROUGH TRAINING AND SUPPORT OF THE COMMUNITY,
  POVERTY ALLEVIATION CAN BE ACHIEVED THROUGH
  SUSTAINABLE ECOMOMIC DEVELOPMENT AND MARKET
  LINKAGE
• POTENTIAL DONORS WILL SEE ACTUAL AND SUSTAINABLE
  RESULTS FROM THEIR INPUTS, WHICH NEED NOT BE
  FINANCIAL, COULD BE TECHNICAL.
• THE KILOMBERO AREA IS IN THE EARLY STAGES OF
  DEVELOPMENT AND THE RESULTS AND CHANGES TO LIVES
  AND ATTITUDES IS ALREADY STARTLING, BUT THERE IS
  STILL SO MUCH MORE TO DO.