(Ecofin Agency) - The Chadian government will sell 60% of its stake in CotonTchad Société Nouvelle (CotonTchad SN), cottonseed purchase’s leading company, to the Singaporean Olam International.
This sale agreement, signed last April 23, is in line with the company’s partial privatization which will lead to a reduction of support from the State and a rehabilitation of the cotton sector.
The restructuring is therefore expected to allow the implementation of a program to boost cottonseed production to 300, 000 tons by 2023, from the current 100, 000 tons.
Moreover, Olam will fully finance cotton campaigns, upgrade the cotton oil production’s plant in Moundou as well as all CotonTchad SN’s ginning facilities.
For the record, the Chadian government has so far supported the sector by subsidizing agricultural inputs and equipment and acting as guarantor at Banks for credit granting needed by CotonTchad SN to finance agricultural campaigns.
Let’s recall that cotton is Chad's third largest export product after crude oil and livestock. The sector employs 350, 000 producers and sustains 3 million people.