Privatise state sugar firms, Raila proposes

AU envoy Raila Odinga and Agriculture CS Mwangi Kiunjuri in Kisumu on March 11, 2019. [Denish Ochieng, Standard]

Calls for the privatisation of State-owned mills received a major boost after Opposition leader Raila Odinga threw his weight behind the proposal.

During a meeting in Kisumu, Raila painted a gloomy picture of the industry even as fresh reports by both the Agriculture ministry and the Privatisation Commission highlighted the magnitude of the financial problems facing millers in Western Kenya.

The Ministry of Agriculture revealed that about Sh1.9 billion has already been disbursed to offset the millers debts to farmers.

Raila underscored the need to urgently address the problems dogging the sugar industry to improve production and ensure sustainability of the debt-ridden mills.

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Inclusion of private companies in the management of the sugar factories, he emphasised, is key to revitalising the industry.

“The survival of the sugar industry is at stake and we must support efforts by the Government to find a lasting solution to the problem,” said Raila.

Raila said the country’s sugar industry is unable to compete regionally or globally due to low production and rooted for completion of the privatisation process to improve production.

Currently, he noted, almost all mills are in a deplorable state and lack modern equipment.

“The sector cannot be revived through finger pointing. We should be prepared to take very bold steps,” said the ODM leader.

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He appealed to leaders to play a positive role in the revival of the sugar sector. “No investor can come in an unclear environment. Leaders must stop agitation and help in this process,” said Raila.

“We need to strategic partners to help us in the process of revitalising the mills. We should allow the private companies also to take over the management of some of the companies,” he added.

Raila asked stakeholders to let the plans the Government has to sail through.

Yesterday's meeting was attended by among others Agriculture CS Mwangi Kiunjuri, governors Stephen Sang (Nandi), Cornel Rasanga (Siaya), Okoth Obado (Migori), Senators Ochillo Ayacko (Migori), Fred Outa (Kisumu) and a host of MPs.

Under the privatisation programme, the Government plans to turn five public factories in western Kenya into the profitable ventures.

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The privatisation bid began nearly 20 years ago but has repeated run to dead ends after stakeholders failed to agree on constitutionality of the process, fate of the assets and land, distribution of shares andthe investors who would take over the firms.

The onset of devolution dealt the biggest blow to the process that had gone to the extent of inviting interested investors after governors demanded fresh consultations and even indicated they were ready to take over the companies although their ability to run the capital-intensive investments is questionable.

Once the process is done, farmers in sugar growing regions will lease out their farms to millers who will take care of the farming and harvesting.

According to Raila some of the problems that have hampered progress in the industry include late harvesting of cane, late payment of farmers as well as corruption.

“Our farmers will be involved in leasing out land to the companies. A farmer will now not have to look for a tractor to plough and harvest for them. One company will plough and transport the cane,” said Raila.

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Agriculture CS Mwangi KiunjuriAU envoy Raila Odingasugar factories