Western Kenya sugar belt counties have supported plans to lease State-owned mills, signalling a smooth process of the exercise after they opposed the previous bid to sell the factories to strategic investors.
In a public notice, Kakamega Governor Wycliffe Oparanya and his Kisumu counterpart Anyang Nyong’o said the move would boost sugar production and income for farmers.
Governors have been opposed to selling of the millers to investors previously and they successfully placed a court injunction that delayed the process that ought to have been completed some years back.
“The leasing of sugar mills will inject fresh investments into the mills, leading to higher productivity and subsequent employment of more workers and steady farm gate prices to the farmers. This will no doubt guarantee tremendous increase in sugar production for both local and export markets,” said the two governors in a joint statement.
Privatisation Commission had started the process of selling Miwani, Muhoroni, Nzoia, Chemelil and Sony sugar companies to investors.
The governors, through their Lake Region Economic Bloc, also lauded the move to write off Sh62 billion debt the millers owe the State.
They have also lauded the move to reintroduce Sugar Development Levy, arguing that it would ensure farmers and the counties and factories get a steady source of revenue that will support farm and infrastructure development in the sugar belts.
Agriculture Secretary Peter Munya said the long leases of State-owned firms would increase farmers’ income and improve competitiveness as well as service delivery in the sugar sector.
“Through comprehensive reforms, the government is determined to facilitate a multi-purpose sugar cane industry that is efficient, diversified and globally competitive through enhanced industry competitiveness and cost reduction strategy,” he said.
Mr Munya also banned sugar imports last week and suspended the trading licences to curb influx of cheap sweetener, which has impacted negatively on farmers.
He said the imports had rendered Kenya’s mills uncompetitive because of their cheap nature when compared to the local sugar.
Sugar imports in the first five months of the year rose 21 per cent compared to a similar period last year even as local production improved in the last two months.
According to Sugar Directorate, imports of the commodity between January and May stood at 207,814 tonnes against 172,213 tonnes in the same period last year.