The Coca-Cola Company and its bottling partners will invest 300bn/- ($187m) in Tanzania over the next three years as part of an aggressive growth plan aimed at tapping emerging opportunities in the Non-alcoholic Ready to Drink (NARTD) beverages market.
The US-based global Company’s Chairman & CEO Muhtar Kent made the announcement Dar es Salaam last week during his first official trip to Tanzania since taking the helm of the company in 2008.
Speaking at a cocktail reception with stakeholders Kent, who held a series of meetings with staff, bottling partners, customers, Government officials and NGOs in Dar es Salaam said his visit came at a time when Africa is undergoing an economic transformation.
He cited new investments in infrastructure, the phenomenal growth of the telecoms industry, the rising middle class and the burgeoning teen population as some of the indicators that Africa is the next frontier for business.
“Our belief in this continent is enduring and unshakable. In fact, I believe Africa is one of the great untold — or at least under-told —economic stories of this decade. We’ve been operating in Africa since 1928, and this continent remains a critical market for Coca-Cola.
We also recognise Africa’s extraordinary growth potential, which is one reason we plan to spend significantly in the continent during this decade. Africa’s growing middle class and increasingly younger population creates growth opportunities for our business,” he said, adding that the Coca-Cola Company had invested over 570bn/- (USD358 million) in Tanzania in the past three years alone.
The new investments, he said, would mainly go into manufacturing and distribution infrastructure and marketing with the aim of enhancing its competitiveness in a market that is witnessing one of the highest GDP growth rates in Sub Saharan Africa. Last year, Tanzania’s economy grew by an average of 6.5 percent, way above the Sub Sahara GDP average of 5.5 percent.
Kent said that in the past decade, the Coca-Cola Company had invested over USD6 billion in Africa and projects to invest another USD12 billion by 2020 as part of the company’s plan to double its business globally – in revenue, servings and volume.
The Coca-Cola Company has three bottling partners in Tanzania- Bonite Bottlers (Moshi), Kwanza Bottlers (Dar) and Nyanza Bottlers (Mwanza) and a portfolio of soft drinks, water, juice and energy drinks. Kent hinted that by improving manufacturing capacity, the company will be well placed to introduce new brands in the market to improve consumer choice and bolster category growth.
The Coca-Cola Company is one of the major investors in Tanzania, contributing over 103bn/- (USD72.4 million) in value addition to the Tanzanian economy annually and supports the employment of more than 91,000 - an estimated 2,700 directly and nearly 70,000 in the system’s supply chain.
The Chairman & CEO pointed to sustainability as critical to the success of Coca-Cola in the market and cited several community based programmes that enable the company to connect with local communities and Government as a way to do business sustainably.
“We recognise that our business can only be as strong, vibrant and sustainable as the local communities we proudly serve. Because of our belief on the continent, we continually invest significantly in our communities. Our sustainability focus in Africa is on increasing access to safe water, boosting health and youth development and providing humanitarian assistance,” he said.
In the past two years, he said, the company, through the Global Fund has supported the Tanzanian Medical Stores Department (MSD) to improve access to critical medicines across the country by sharing its supply chain capability. Through this project, Coca-Cola has provided training as well as technical assistance in areas such as planning, procurement processes and capability development to address skills gaps. This support is helping MSD to service over 5,000 clinics compared to just 500 before the introduction of the programme.
The Coca-Cola Company has also invested in several water and sanitation programmes across the country in partnership with Government, NGOs and development organizations.