One of the major companies in the Burundian economy, Sosumo has been facing a production shortfall for several years. The shortage of sugar on the local market is recurrent and households suffer the repercussions. The State’s commitment to intervene to save this company is still pending.
Sosumo’s objective of satisfying local demand for sugar and saving foreign exchange by avoiding the import of sugar has never been achieved.
The Burundian market is still affected by the sugar shortage. In the municipality of Bujumbura, the price of one kg of sugar has rebounded. While one kg of this product was at 2500 FBu for the last few months, this price is currently between 3500 FBu and 5000 FBu. This discrepancy in prices is the consequence of the shortage of sugar observed on the local market where this product is becoming increasingly rare. “We cannot give enough sugar, because it brings us close to loss,” explains a shopkeeper in the Bwiza district. According to him, sugar is once once more scarce on the market and it is difficult to obtain supplies of this product in large quantities.
Who will save Sosumo?
If the State pays particular attention to the problem related to the modernization of Sosumo, the delay in the implementation of projects going in this direction questions more than one. The Burundian State has taken several actions to try to keep society in balance. Among the challenges, poor management was singled out. To revive this sugar refinery, whose fields extend over several hectares in the east of the country, a steering committee was set up by decree no. 100/198 of September 21, 2016. This steering committee, which had been appointed by the President of the Republic and was coordinated by a small office composed of high authorities including the second vice-president and the Minister of Commerce.
In November 2018, the Ministry of Commerce announced the State’s desire to sell part of its shares to private individuals. The share of the State in the shareholding of Sosumo would drop from 99% to 46.32%. Private shareholders were therefore going to take over with 53.68%. At that time, Jean Marie Niyokindi believed in the possibility of succeeding in redressing a society that was on the verge of collapse with the contribution of the private sector. The organizational and economic audit report estimated Sosumo’s financing needs at 20 million USD for its rehabilitation, extension and modernization program. Beyond the desire to boost the production of Sosumo, the Ministry of Commerce recently called on economic operators to develop other private sugar industries parallel to Sosumo to increase sugar production.
What regarding the reasons behind the recurring shortage of sugar?
Sosumo’s objective of satisfying local demand for sugar and saving foreign exchange by avoiding the import of sugar has never been achieved. The production of this unique sugar factory in Burundi, which has held the monopoly of the sugar trade since its creation, has evolved up and down with a horizontal trend. At its creation, the population of Burundi was estimated at five million inhabitants. Although it managed to quadruple its first production, which was 4,658 tons in 1988, Sosumo is today unable to meet local demand. As for the population, it will grow exponentially. It is currently estimated at 12 million inhabitants, while the production of Sosumo is still stagnating around twenty thousand tons.
Other problems are linked to difficulties in importing sugar. To make up the deficit, SOSUMO is obliged to import a large quantity of sugar from outside according to the needs of the moment. According to data from the BRB, Burundi imported a quantity of granulated sugar for nearly 30.4 billion FBu in 2020. This sum will be increased to around 95 billion FBu in 2021 while it will exceed 50 billion FBu in 2022. However, the shortage of foreign currency on the local market must have consequences on imports.
All the announced reforms have unfortunately not been carried out. However, Sosumo officials have always claimed to be working on expanding fields and importing new machinery. In 2010, this sugar factory almost went out of business following years of mismanagement. She will manage to keep her head above water thanks to the intervention of the late Audace Bukuru, a banker who was appointed to lead her.
