Many families are facing hardship as Triangle Limited, the country’s largest sugar producer, prepares to embark on a mass retrenchment exercise. Citing the deteriorating economic conditions in Zimbabwe, the company will implement the retrenchment in three phases, beginning next month and concluding in August 2025.
Triangle attributed the difficult decision to rising operational costs, currency devaluation, and competition from low-cost, duty-free imported sugar.
“The current economic environment in Zimbabwe has presented unprecedented challenges for Triangle Limited over the past three years,”<span;> said Tendai Masawi, Managing Director of Triangle.
“Escalating operational costs, particularly in areas such as fertilizer, fuel, maintenance, and imported goods and services, combined with inflationary pressures, currency losses, the inability to claim VAT on inputs after sugar was exempted from VAT, and competition from low-cost, duty-free imported sugar, have severely impacted our ability to sustain current levels of operation.”
Masawi further explained, “Since 2022, we have witnessed a significant 55% decline in profit margins, a 133% increase in manpower costs as a proportion of revenue, and a rise in debt levels to unsustainable levels. The company has been unable to generate positive cash flows from its operating activities for the past three years and has faced a severely constrained working capital position since the implementation of the revised cane supply arrangements, necessitating constant trade-offs between business needs and affordability.”
Masawi acknowledged that the company has implemented numerous cost-reduction and revenue-enhancement initiatives, but these efforts have proven insufficient to stabilize the business.
