Friday, April 12, 2024

Financiers shun multibillion Zambezi Agro-processing project?

The ambitious Zambezi Integrated Agro-Commercial Development Project which was mooted by the government more than ten years ago has been stalled due to unavailability of funds and partners.  

Last week, Beauty Manake, the assistant minister of Agricultural Development and Food Security, told parliament that the project which was then expected to cost $780 million (P8.6 billion) has failed to get funders. The multi-billion-pula project involves drawing 495 million cubic meters of water per year from the Zambezi river, diverting it to irrigate the over 45,000 hectares in Pandamatenga farming region. 

“The Agro Zambezi Project has progressed according to the following stages; feasibility studies have been done, conceptual designs, financial and economic analysis, the Environmental and Social Impact Assessment; all of which have been completed. Other stages of development are expected to commence immediately after funding has been sourced,” said Manake. 

She explained that the project delayed due to structuring the funding and the protracted negotiations with financial partners. Manake said over the years they were able to build a solid business case for the existence of the project. The study findings suggested that the project is economically viable, and  could create more than 2600 permanent jobs, producing about 160 000 tonnes of cereals and oil seeds, 216 000 tonnes of mangoes annually, and improve the agro-processing industry.

The government has also managed to secure land from Chobe residents top pave way for developments. However, the government is yet to secure funding for the initial developments before the private sector could jump in. The Agro Zambezi project is now part of the Special Economic Zones (SEZs) in which government is hunting for international investors to come set up businesses and develop some areas through public private partnerships (PPPs), reducing the financial burden. 

This week, Manake’s boss, Dr. Edwin Dikoloti, also confirmed to parliament that the initiative to develop Zambezi Integrated Agro-Commercial scheme to improve agricultural output in the Chobe area has stalled due to several challenges, citing the difficulty of securing appropriate partners under PPP arrangement. 

“However, a lease for the 40 000-hectare plot to be developed under this project has been acquired. Funding is being sourced from the African Development Bank, to implement the project as a Public Private Partnership (PPP) initiative, and considerable number of agencies have shown great interest to be potential partners,” said Dikoloti when presenting the Agriculture ministry budget proposals. 

The ministry has asked for P976 million development budget, of which the Zambezi Agro Commercial Development project will gobble P5 million as they try to get it into shape to attract partners who will fund the whole multi-billion-pula project.


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