What Sh12 billion vanilla investment in Zanzibar means

Dar es Salaam. Hope continues to mount in Zanzibar following an intention to invest up to $5 million (Sh11.5 billion) in vanilla production and value-addition expressed by a firm from the Comoros.

Dr Hussein Ali Mwinyi assumed the Presidency of Zanzibar on November 2, 2020 and pledged major reforms in the policy and regulatory frameworks in order to attract more investments.

Just a year down the line, investors have started flocking to the Isles and that after achievements recorded in the tourism sector, the agricultural segment has started receiving blessings.

Dr Mwinyi is heading the Government of National Unity (GNU) formed by CCM and the opposition ACT-Wazalendo.

But, on Wednesday, the Zanzibar’s Minister of State in the President’s Office responsible for Labour, Economy and Investment, Mr Mudrick Ramadhan Soraga, told The Citizen in an exclusive interview the government held talks with a delegation from the AGK Company of the Comoros.

The company, based in Moroni, is a major producer and exporter of vanilla, cloves and ylang ylang, noting that the firm also operates in Madagascar.

“With an annual capacity of 50,000 tonnes of vanilla, the company seeks to invest between $3 million and $5 million for production and processing of the crop,” he said.

He said the company seeks to be provided with 23 hectares to 25 hectares of land for the crop cultivation as well as five hectares for construction of a processing factory.

Mr Soraga said upon completion, the firm will employ 300 citizens and that out grower farmers would be involved through provision of better seeds as well as training being part of the capacity building.

“After concluding our talks yesterday (Tuesday), the delegation was taken to the Zanzibar Investment Promotion Authority (Zipa) where they collected application forms requesting the certificate of investment,” he said.

He added, “The company officials will return to the country after 15 days for completion of the pending issues. Zipa is working to ensure its processes are completed within the first week of February.”

According to him, the eighth government was determined to restore the pride of Zanzibar that made it to be referred to as the Spice Islands after becoming global leader in the export of cloves, noting the focus was crop diversification.

“Together with cloves, we are supposed to add more other spices of which we have a huge comparative advantage. Having expertise in the production of ylang ylang oil, the company officials have pledged to plant the crop after commencing vanilla production,” he said.

However, the minister couldn’t immediately establish estimated annual vanilla production that has been forecasted by investors.

But, Minister Soraga said the investment will broaden the government’s tax base, income tax from created jobs and reduce deficit in the balance of trade and provide huge multiplier effects to the economy of Zanzibar.

In a video clip, the AGK Company chief executive officer, Mr Amine Kalfaue says, like the Comoros, Zanzibar had conducive weather conditions supporting vanilla production.

“I think there is a chance for Zanzibar to develop another source of revenue because there is an opportunity to produce quality vanilla here,” he says.

The director of Agriculture in Zanzibar’s Ministry of Agriculture, Irrigation, Natural Resources and Livestock, Mr Mohamed Rashid, says the Isles had the room to increase vanilla production despite the limited size of land.

“Vanilla is an intensive crop that doesn’t need a large cultivation area, rather it can be grown in small areas like what happens in green houses,” he said.

The Association of Tanzania Oil and Gas Service Providers deputy chairman, Mr Abdulsamad Abdulrahim, says that the deal was significant as it focuses on value addition, job creation and knowledge transfer.

“Therefore, I request stakeholders’ cooperation because this is our country. We are all struggling to build the same house,” he said.

Mr Daud Mbongo of the Tanzania Agriculture Research Institute (Tari-Uyole) hailed Zanzibar authorities for the major investment.

“Increased investment in the sector promotes competition among traders and ultimately an increase of prices and therefore benefits farmers,” he says.

The Tanzania Horticultural Association (Taha) agronomist based in Zanzibar, Mr Ally Kamtande Ally told this reporter this year that processed vanilla was among crops sold at high prices.

However, he said the price reached Sh850,000 per kilo before declining to Sh450,000 per kilo due to impacts of Covid-19.

“However, the new price was boycotted by farmers who sought the intervention of Taha in looking for prospective buyers,” he said.