How Illovo Sugar SA is empowering Kwa-Zulu Natal communities with this fund

Illovo Sugar South Africa has spearheaded a groundbreaking project aimed at developing up to 3,000 hectares of small-scale grower cane land on the Kwa-Zulu Natal South Coast. Through a strategic partnership with the National Treasury via the Jobs Fund, the initiative has resulted in the creation of over 1,100 new jobs and the training of more than 1,600 individuals. Mamongae Mahlare, the Managing Director at Illovo Sugar South Africa, recently sat down with CNBC Africa to shed light on the project's milestones and impact within the local community. The project's primary objective was to rejuvenate and bring back into production unused cane land in close proximity to the company's mill and within the local community. This endeavor also aimed to foster partnerships for the development of new enterprises in the area. While significant progress has been made, challenges still persist in fully realizing the project's targets. One notable aspect of the initiative is the innovative funding model deployed to involve cane growers in the project. Illovo Sugar, along with the Jobs Fund and growers, contributed various proportions of the financing. Farmers were able to access loans from Mahfisa at an incredibly low 1% interest rate, enabling them to kickstart operations and start repaying their debts upon the initial harvest. The payment plan is structured over a 10-year period, with provisions for accelerated repayment as the growers enhance their productivity and revenue generation. The recent upsurge in sugar prices, complemented by a positive outlook for the commodity globally, has further boosted the farmers' capacity to repay their loans. With around 45% of the sugar produced being earmarked for export markets, favorable price trends have proven advantageous for the community of growers involved in the project. However, sustainable local market dynamics remain vital for long-term success, beyond relying solely on fluctuating commodity prices. While applauding the project, the Minister of Agriculture has underscored the ongoing challenges of land distribution and restitution that need to be addressed comprehensively. Looking ahead, the impending sugar master plan is expected to provide further guidance and strategic direction for the industry. Illovo Sugar's experience in collaborating with the public sector on this initiative highlights the significant impact that public-private partnerships can bring to rural economies and underserved communities. Mahlare emphasized the importance of continued private sector engagement in similar development projects, calling for more initiatives that drive economic progress at the grassroots level. The success of the collaboration with the Jobs Fund serves as a testament to the effectiveness of such partnerships and underscores the potential for promoting socio-economic advancement through collective efforts. Illovo Sugar stands committed to supporting and participating in future programs that align with its mission of community empowerment and sustainable economic growth.