Counties

State to set up SEZ on Muhoroni land

kisumu-city

Part of Kisumu City skyline as seen from the Kisumu Port in Lake Victoria. PHOTO | JEFF ANGOTE | NMG

geraldandae

Summary

  • Agriculture Cabinet Secretary Peter Munya said the government had identified a thousand acres belonging Muhoroni Sugar factory land, which will be used for the creation of the SEZ.
  • Part of the plans will see the government establish a textile factory in zone, which to boost exports to the US under the Africa Growth Opportunity Act (Agoa).

Plans to establish Special Economic Zone (SEZ) in Kisumu are underway after land was identified for setting up a tax-free area.

Agriculture Cabinet Secretary Peter Munya said the government had identified a thousand acres belonging Muhoroni Sugar factory land, which will be used for the creation of the SEZ.

Part of the plans will see the government establish a textile factory in zone, which to boost exports to the US under the Africa Growth Opportunity Act (Agoa).

Mr Munya said that Kenya was yet to fully exploit the earning opportunities offered by Agoa, held back by its fledgling textile sector that has seen firms rely on fabric imports from China for processing because of the local shortage.

“We have identified a thousand acres from Muhoroni factory, which is government land and it is there that we are going to place this Special Economic Zone,” said Mr Munya.

Mr Munya said the SEZ will also be instrumental in processing by-products from Muhoroni sugar factory. This may come as a boost to the ailing miller.

In 2019, a group of locals opposed to the establishment of the SEZ in their ancestral land when ODM Leader Raila Odinga and Cabinet Secretaries James Macharia and Peter Munya toured the area.

The government formed a task-force in 2019 to oversee development projects in Kisumu to help reposition the Lakeside City as a hub for the East Africa region.

Rehabilitation

The task-force was chaired by Infrastructure Cabinet Secretary James Macharia with his counterparts including John Munyes (Petroleum)and Peter Munya then Trade and Industrialization Cabinet Secretary.

The team was expected to implement the Kisumu Integrated Development Plan whose components include a Special Economic Zone, rehabilitation and modernisation of the Kisumu Port, boats manufacturing and the oil jetty.

The government said in 2019 that Sh500 million had been allocated for the rehabilitation of Kisumu port. With Sh2.5 billion was to be pumped into the project in the last financial year to revive operations at the once vibrant port to connect the East African region.

The Agoa programme allows Kenya and other Sub-Saharan African countries to export selected goods at preferential terms to the US, exempting them from paying tax.

The initiative, which was expected to end in 2015 after an initial deadline of September 2012, was extended by US lawmakers for another period of 10 years.

The window allows Kenya to export more than 6,000 product lines but has been dominated by export of textile and apparel, which accounts for 65 per cent of the total exports.

Increasing trade volumes and range of products are some of the grounds that Kenya used to successfully push for a 10-year Agoa extension, now open up to 2025.

Since 2000, there have been four extensions of the programme in August 2002; July 2004; December 2006. The last, in June 2015, extended Agoa for a further 10 years to 2025, including third-country fabric provisions.