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Sudan’s largest sugar producing company faces serious crisis

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July 14, 2014 (KHARTOUM) – Sudan’s largest sugar plant, the Kenana Sugar Company, (KSC) is facing a serious crisis following an escalating dispute between its managing director, Mohamed al-Mardi al-Tigani, and the minister of industry, al-Simaih al-Siddiq.

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Employees pack refined sugar at the Kenana Sugar Company’s main plant, 270kms south of Khartoum on 14 May 2013 (Photo: Reuters/Mohamed Nureldin Abdallah)

The KSC board of directors meeting, which was scheduled for Tuesday, might possibly not take place after the security guards at the company’s headquarters prevented Tigani from entering the premises on Monday.

Reliable sources told Sudan Tribunethat Tigani was surprised by the decision to deny him entry to the headquarters while some Arab members of the board were waiting for him inside the building to complete arrangements for the border’s meeting on Tuesday.

Al-Mardi, according to the same sources, left the headquarters without meeting the board members who also left without completing their meeting.

The same sources stressed that influential bodies within the government have embarked on making intensive contacts to resolve the dispute and prevent any negative implications particularly as the Arab partners expressed strong resentment towards the recent dispute.

It further predicted that moves of the government officials within the coming hours would likely manage to defuse the crisis in order to hold the board meeting.

Meanwhile, reliable sources underscored that the minister of industry insists on holding the board of directors meeting despite threats of Arab partners to boycott it if he doesn’t back down from his decision to fire Tigani.

The minister of industry had met last week with the Kuwaiti ambassador to Khartoum and informed him of the decision to sack Tigani and appoint KSC’s financial director, Abdel-Seed Taha, as acting managing director until selecting a new one.

According to information acquired by Sudan Tribune, Tigani was not notified by the board of directors of the decision to sack him from his position according to the contract signed between him and the company which states that he must receive the decision at least one month before it was carried out.

The same sources pointed out that Tigani continued to fulfill his regular duties because he did not receive any official notification.

Meanwhile, the head of the parliamentary subcommittee on industry, energy, and mining, Omer Adam Rahma, told reporters on Monday that recent changes in KCS and White Nile Sugar Company (WNSC) are administrative ones, saying they do not target particular individuals.

He stressed the minster of industry’s decision to sack KSC managing director was taken under his capacity as chairman of the board of directors, criticizing the former’s decision not to allow government financial audit since 1978.

Rahma further said that KSC acted improperly with Sudan’s auditor general, pointing that KSC declined by 25% while the WNSC’s production has not exceeded 74%.

KSC’s major shareholders include the government of Sudan with 35.17 percent, the government of Kuwait with 30.5 percent, Saudi Arabia with 10.92 percent, the Arab Investment Company with 6.96 percent.

KSC is situated in an area of 168,000 feddans (70,000 hectares). The plant, which began its actual production in 1980, is located 250 km (160 miles) south of Khartoum.

KSC crisis had surfaced several months ago when Sudan’s auditor general, Al-Tahir Abdel-Qayoum, told the Sudanese parliament that the company refused to conduct financial audit under the pretext that it is not a government unit but a private company.

Sudan’s annual sugar imports amounts to 700.000 tonnes while its plants currently, produce between 600,000 and 700,000 tonnes in total annually. The consumption gab is estimated at 50%.

Sugar prices have recently witnessed significant increase which forced the government to allow imports. The move has negatively impacted local production because the imported sugar is sold at lower price than the locally produced one.

(ST)

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