SABMillers South Sudan Subsidiary Foresees Possible Shutdown of Beverage Factory
Published By : 03 Aug 2015 | Published By : QYRESEARCH
South Sudan Beverages Limited is pulling back its operations and forewarning of a probable shutdown if access to diesel and foreign currency does not improve any time soon. This means that the company will be producing fewer drinks at its Juba factory and might also employ lesser people.
A subsidiary of SABMiller, the international beverages company, South Sudan Beverages Limited produces soft drinks, beer, and spirits.
Carlos Gomes, managing director said at a press conference held on Saturday that the company is presently finding it extremely difficult to carry on with operations. The company depends largely on imported raw materials because the kind of materials needed for operations at South Sudan Beverages Limited are not available in the country.
The present financial situation that the nation finds itself in with respect to foreign exchange and hard currencies has put the beverages factory in a very difficult position, Carlos Gomes added.
Gomes explained that the issue of lack of raw materials was the primary concern. The company’s suppliers have been extremely helpful and good so far, supporting the production unit over many years. However, the company’s credit terms with the suppliers have reached the limit, and in some cases, surpassed the limit. Foreign suppliers have no appetite in taking further risks when it comes to extending credit because of the fear of the possibility that South Sudan Beverages Limited being paid in foreign exchange.
However, the situation of diesel is a more critical problem, Gomes said. The company’s operations depend on diesel generated power a 100 per cent. The factory’s diesel supplier has also indicated that the company has exceeded its credit terms. South Sudan Beverages Limited cannot source enough diesel from local sources to keep the operations running at the level that is required.
Carlos Gomes said that the beverages company could not presently run its factory at full capacity because of the shortages of diesel and foreign exchange.