The Zambia Development Agency (ZDA) and Sunbird Limited of UK have signed a US$190 million Investment Promotion and Protection Agreement (IPPA) for a bioenergy project in Kawambwa district.
ZDA board chairperson Mary Ncube said the project would directly support rural industrialisation and enhance the social and economic well-being of the people around Kawambwa.
Ms Ncube said the project would also contribute to reduction in petroleum product imports, resulting in savings of the scarce foreign exchange.
“Entering into an IPPA is to assure the investor that their investment is protected whilst at the same time ZDA pledges its support to facilitate the resolution of issues that might negatively impact the implementation of the project,” she said.
And deputy Commerce minister Raymond Mpundu said the project signified commencement of operations for Sunbird’s investment after considerable negotiations.
Mr Mpundu said the massive investment would contribute to the development of not only Kawambwa but the entire Luapula Province.
He said it was Government’s priority to diversify the economy from extractive industry reliance into a more agro-based manufacturing one.
“I wish to emphasise that Government’s primary goal is to deliver pro-poor inclusive growth aimed at creating sustainable jobs and wealth for the people of Zambia. It is incumbent upon all of us especially those that will be doing business with this ethanol plant to safeguard its well-being,” he said.
Mr Mpundu further encouraged the investor to diligently adhere to the laws of the land and strictly honour the commitments in the IPPA.
The bioenergy project, which will require up to 700,000 metric tonnes of cassava to produce 120 million litres of fuel grade ethanol per annum, will be set in the Luena farm block which will convert cassava into bioethanol.
The project will also include the setting up of a biomass power plant that will generate 36 megawatts (MW) of electricity, of which an estimated 3MW will power the refinery and the excess 33 MW will be fed into the national grid to support rural electrification.