Governors now want to manage State sugar millers, oppose sale

The Council of Governors (CoG) has asked the Treasury to clear over Sh50 billion in debts accumulated by State-owned sugar companies instead of selling them.

The governors said that once the debt is repaid the firms should be put under the management of counties as agriculture is a devolved function.

Okoth Obado, the CoG Agriculture Committee chairman, said the national government approved the privatisation plan without involving counties hence rendering the move unconstitutional.

“The (privatisation) process started after counties were formed, it would have been wise to involve them because agriculture is devolved. Why is the national government clinging to assets that belong to counties?” Mr Obado asked.

He was speaking in Kisumu during a meeting on privatisation. The government had approved the sale of Nzoia, South Nyanza, Chemelil, Muhoroni and Miwani sugar factories as part of efforts to make them efficient and to survive competition from other Comesa producers. Two of the millers, Muhoroni and Miwani, are in receivership.

The Privatisation Commission had planed to sell 51 per cent of each of the millers to strategic investors with a track record of managing sugar companies.

However, Kisumu Senator Anyang’ Nyong’o and Gem MP Jakoyo Midiwo moved to court to challenge the move.

The two leaders said the decision to auction the millers was not properly constituted. They said that issues raised by stakeholders had not been resolved.

“The subject of privatisation is of utmost importance to stakeholders, in particular cane farmers, as it goes to the root of their livelihood,” said Prof Nyong’o. Mr Obado said the commission should explain to farmers how the process will benefit them.

“Without our blessings, no process is going to take place and the commission should not force it on us,” he said. He asked the commission, which had suggested that counties buy the millers, to stop day-dreaming.

“How do you buy what is rightfully yours? After devolutio, we were given full possession of the millers,” he said.

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However, Prof Karega Mutahi, the chairman of the commission, said they could not hold consultations because the case is in court.

“If you are against the sale of millers and cases are in court, how do we help the situation? The only thing we need to do is save the industry from collapsing.’’

Prof Mutahi said that the industry should be protected. “I can assure you that when we allow the protection of Comesa to collapse you will be surprised at how flooded the market will be with imported sugar,” he said.

The commission, he said, was established to solve disputes between the national and county governments.

Kisumu governor Jack Ranguma said the commission should not hold meetings exclusively in Nairobi and shun counties.

“It seems that the meetings the commission conducts have not been extensive enough, it should go back to the drawing board and start afresh by involving all stakeholders,” he said.