Acting Commissioner for Co-operatives Development G.N. Njang’ombe has constituted a team of four to oversee the liquidation of Kenya’s largest coffee dealer, the Kenya Planters Co-operative Union (KPCU).
In a gazette notice dated August 2, Mr Njang’ombe appointed Stephen Kamau Njoroge (Assistant Director of Co-operatives Audit), Doris Wangui Githua (Principal State Counsel), Antony Maina Waithaka (Principal Co-operative Auditor in Murang’a County) and Joyce Nkirote Kimuu (Senior State Counsel) as joint liquidators.
The team has been given a maximum of six months to sell the assets of KPCU, which would mark the end of an era for the 75-year-old coffee giant in the country.
KPCU has a membership of at least 750,000 small scale farmers represented through over 300 co-operatives and about 2,000 estate farmers owning small, medium and large-scale farms.
It has an installed milling capacity of 150,000 metric tonnes of clean coffee per year, with infrastructure located in Nairobi, Tala, Sagana, Meru, Nanyuki, Nakuru, Bungoma and Kisumu. The company can mill 34 tonnes per hour.
The liquidation notice comes a few days after President Uhuru Kenyatta directed Trade and Industrialization CS Peter Munya to start restructuring Kenya Farmers Association (KFA) (formerly Kenya Grain Growers Co-operative Union (KGGCU)) and KPCU for the benefit of farmers.
“I direct the Ministry of Industry, Trade, and Co-operatives to fast-track the formulation of the National Co-operative Policy and immediately operationalize the proposed Sacco Societies Fraud Investigation Unit (SSFIU) within the Sacco Societies Regulatory Authority (SASRA),” said the President.
He further directed Munya to fast track investigation into the stalled operations of the two organizations to safeguard members contribution.
“Our goal as government is to serve as facilitators and enablers, to clear the path for co-operatives so that they and their members can realize their full potential,” he added.
KPCU’s assets are estimated to be worth Ksh6 billion, and the joint liquidators have been authorised to seize them and anything else that will help in liquidation, including books of accounts.
Recently, senior management officials were evicted from their offices by State Department for Co-operatives and DCI (Directorate of Criminal Investigations) officers.
KPCU’s liquidation points out to a ailing sector of saccos and SME unions driven by graft and incompetent leaership. Other unions facing cash crunch include Kenya Plantation Workers Union (KPWU), Kenya National Federation of Co-operatives(KNFC), now known as Co-operative Alliance of Kenya and the National Housing Sector Co-operative Union (NACHU).
Kenya’s coffee and tea are country’s biggest foreign exchange earners with millions of Kenyans depending on them for a livelihood.
Last financial year, 2019, the value of tea exported for the January- November period grew by Ksh8.9 billion according to data by Kenya National Bureau of Statistics.
The value of green leaf exports grew to Ksh129.05 billion compared to Ksh120.13 billion over the same period last year.
Over the period, coffee exports hit 42,368 tonnes, an increase of 860.57 tonnes compared to 41,507.43 tonnes recorded in 2017.