TBL to construct US$ 50m malting plant in Iringa

According to the Managing Director of the Group, Mr Roberto Jarrin, the company has been spending 31bn/- each year to import 19,000 tonnes of malt, a key ingredient in manufacturing of beer. “At present, we are still discussing with the government on the possibility of granting us excise duty remission for locally sourced raw materials, particularly malt.

“If the government gives us a green light on the remission the project will take 18 months to accomplish,” Mr Jarrin told journalists in Dar es Salaam yesterday when presenting an overview of the company’s performance in 2015 and the outlook for the year 2016/2017.

Mr Jarrin stressed that the tax remission is crucial to make the envisaged malting plant commercially viable. “Other countries in the East African region have been doing the same to encourage local sourcing of raw materials,” he stated.

The TBL Group comprises three companies namely the Tanzania Breweries Limited (TBL), Tanzania Distilleries Limited (TDL) and Dar Brew Limited. “Our malting plant in Moshi (Kilimanjaro Region) has the capacity to produce 15,000 tonnes of malt which is used to produce beer at Arusha and Mwanza Breweries,” he explained.

He pointed further that the company had trained farmers in Iringa on cultivation of barley in pilot projects which will be scaled-up once the malting plant is constructed.

On the other hand, Mr Jarrin said the Group has paid about 2.3trl/- in taxes during the past ten years, noting further that the company has created over two million direct and indirect jobs for people involved in the supply chain.

The TBL boss complained however that per capita consumption of beer in Tanzania was low due to among others low incomes for majority of the people. “Studies have shown that it takes an average of 4.5 hours of work for a Tanzanian to buy one bottle of beer while in South Africa it takes 0.4 hour. That is to say beer is expensive relative to the incomes of the majority of the people,” he explained.

He added; “The other factors that have stagnated the beer business include prevalence of a large market for informal alcohol as well as lack of incentives to encourage local production of key raw materials such as malt.”

Mr Jarrin complained further that increases on excise duty are not aligned with the rate of inflation, proposing that the government should peg the duty at 5 per cent in line with the existing inflation rate of 5.1 per cent.

SOURCE: DAILY NEWS

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