Government will oppose the liquidation of Tongaat Hulett amid efforts to save jobs and the livelihoods of the thousands of sugar cane growers.

This was revealed by the Department of Trade, Industry and Competition (DTIC), stating that while the government respects the courts and the current legal processes, liquidation should be a last resort.

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Tongaat Hulett announced last week that it has applied for provisional liquidation as a result of the business rescue plan no longer being implementable.

This move could result in the cessation of operations at sugar mills, including Felixton, Amatikulu and Maidstone.

The DTIC said liquidation would have ‘far-reaching and devastating consequences for the sugar sector, particularly in KwaZulu-Natal’.

“Accordingly, the DTIC, together with other organs of state, will oppose the liquidation of Tongaat Hulett and will continue to support all lawful efforts aimed at finding a viable and durable resolution.

“Government will intensify its engagements with all stakeholders, including the Industrial Development Corporation (IDC), labour, growers, financiers, investors and affected communities, to explore solutions that ensure the survival of the company and the long-term sustainability of the sugar sector,” the department said in a statement.

It further noted that the collapse of Tongaat Hulett will ‘deepen economic distress in already vulnerable communities and undermine years of investment in transformation, industrial capability and agricultural development’.

The SA Canegrowers association said allowing Tongaat Hulett’s operations to collapse would accelerate the country’s dependence on sugar imports, increasing long-term exposure to ‘volatile global prices and exchange rate risk’.

“The cost of stabilising and preserving these operations is materially lower than the long-term social, fiscal and industrial cost of rebuilding a collapsed value chain — if rebuilding proves possible at all,” said chairman of SA Canegrowers Higgins Mdluli.

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