Governors in the western region have changed tune on the privatization of public-owned sugar mills, setting stage for leasing of the mills to investors as part of the national government’s bid to revive the ailing industry.
According to Kakamega Governor Wycliffe Oparanya and his Kisumu counterpart Anyang Nyong’o, the move will boost sugar production and increase income for sugarcane farmers.
The region’s leadership had opposed a previous bid to privatize the industry.
They successfully obtained an injunction that delayed the leasing plans.
“The leasing of sugar mills will inject fresh investments into the mills, leading to higher productivity and subsequent employment of more workers as well as steady farm-gate prices. This will no doubt guarantee tremendous increase in sugar production for both local and export markets,” the two governors said in a public notice.
The five factories that will now be leased are Chemelil, Miwani, Muhoroni, Nzoia Sugar and South Nyanza Sugar (SonySugar). Miwani and Muhoroni are already under receivership.
Governors through their Lake Region Economic Bloc also lauded the decision to write off Ksh62 billion debt that millers owe the state.
The old debts had frustrated efforts to revive the industry hence making it difficult to attract investors even as farmers decried unpaid dues.
While announcing a move to revive the industry, Agriculture Cabinet Secretary Peter Munya stated that the long leases of state-owned firms will help increase farmers’ income, enhance competitiveness and service delivery in the sugar sub-sector.
“Through comprehensive reforms, the government is determined to facilitate a multi-purpose sugar-cane industry that is efficient, diversified and globally competitive,” said Munya.
The declaration came after leaders from the western region led by Oparanya and trade unions Francis Atwoli met President Uhuru Kenyatta on July 1.
The leaders reportedly discussed a raft of measures to revive the region’s economy.
A day after the meeting Munya also banned the importation of brown sugar a move he said was aimed at protecting local farmers.