How new $300 million glass factory will save Tanzania billions

 

A glass factory. PHOTO | iStock

By Alex Nelson Malanga

Business journalist

Summary

·          The $311 million (about Sh743.3 billion) factory will have a production capacity that can meet and exceed the demand in Tanzania and other neighbouring countries in East Africa.

Dar es Salaam. Tanzania stands to save $25 million of its foreign exchange earnings if the ongoing construction of a float glass factory completes.

 

Completion of the factory, currently being built at Mkuranga District, Coast Region, is scheduled for September this year.

The $311 million (about Sh743.3 billion) factory will have a production capacity that can meet and exceed the demand in Tanzania and other neighbouring countries in East Africa.

 On a daily basis, the Sapphire Float Glass (Tanzania) Company Limited which is set to start production in September this year, will be producing 700 tonnes of glass production for the first phase, according to the company’s managing director and owner, Mr Jack Feng.

 The figure is against the country’s demand of 175 tonnes, suggesting that the country’s demand is only 25 percent of the company’s production capacity.

As a matter of fact, 75 percent of the production will be for export, according to Mr Feng in his presentation to the Permanent Secretary in the President’s Office (Investment docket), Dr Tausi Kida, who toured the project site on Monday.

The company’s targeted international markets are, among others, Kenya, Zambia, Uganda, Congo DRC, Malawi, Mozambique, Rwanda, South Africa, Burundi and Madagascar.

Mr Feng said his company will bring in several economic benefits, including a reduction in Tanzania’s import bill for glass products, an increase in foreign exchange and expanded exports to neighboring nations.

“The company assures the government of availability of glass domestically and eventually reduces dependence on imported glasses,” said Mr Feng.

The exportation of 75 percent of the company’s production will be attracting $75 million (about Sh179.3 billion) in foreign earnings per annum.

For her part, Dr Kida, commended the investment, underscoring that upon completion, the establishment will be the largest float glass factory in East and Central Africa.

“This progress on the project is commendable indeed. It is one of the strategic projects which would transform the economic growth of our country,” she said.

With over 80 per cent of raw materials sourced locally, the factory’s operations will stimulate the domestic market, fostering economic growth and self-sufficiency, according to the presentation to the PS.

The project is expected to create over 1, 655 direct jobs when operations kick off, according to the company.

The icing on the cake, it will generate 6,000 indirect jobs.

As part of its future business expansion plans, the company is planning to establish a diverse range of glass-related products in Tanzania, including glass bottles, cups, car glass and other relevant glass products.

The company also called for the government to consider an increase of import duty rate change to 35 per cent which are currently imposed at 10 and 25 per cent.

The purpose of this change, they said, is intended to protect local manufacturers of glass and other glass products (including glass mirrors) and against cheap, substandard and undervalued imports.

Float glass is a sheet of glass made by floating molten glass on a bed of molten metal of a low melting point, typically tin.