Cleanse the poisoned chalice that is Kenya's sugar sub sector
| Jun 09, 2023
The challenges faced by sugar companies in Western Kenya have impacted not only the industry but also the lives and livelihoods of thousands of farmers.
Mumias Sugar Company (MSC) has been a case study in mismanagement of resources and questionable decision-making. The firm’s assets, which include 8,000 acres of nucleus land, sugar factory, houses, club and water plant, were leased in an arrangement that cannot help repay the billion of shillings the miller owes banks, former staff and others.
To reverse this sorry state of affairs, there is a need to support small-scale farmers by financing their operations. In its heydays, the sugar sector was so organised that farmers had their own strong association and many actually educated their children, provided medical care to their families and met other household needs using proceeds of sugar cane farming.
However, ineptitude, corruption and failure to consult stakeholders eroded the trust of these farmers, so much that they abandoned cane farming altogether. The first blunder was selling two small millers and buying a diffuser, a tragedy that was worsened by undersupply of sugar cane, yet the diffuser was aimed at crushing 8,000 tonnes of sugarcane per day.
Things went so bad that even the government’s injection of billions in financial support failed to achieve the desired results. This was after these investments were diverted to non-critical projects, undermining revival efforts. Besides the despicable importation of sugar for repackaging at the main sugar factories, reports of unsafe working conditions and strained relations with former staff and the local community leave a very bad taste in the mouth.
To revitalise the sugar industry, transparent and accountable management must be re-established. The government should ensure that the macroeconomic environment in the sugar belt is amenable to the revival of the sector. The authorities must also come up with policy reforms, facilitate market access and give incentives for banks and other lenders to offer farmers affordable credit.
Farmers should also be trained on sustainable techniques that improve productivity, minimise environmental impact and ensure long-term viability. To end the cloud of mistrust bedeviling the sector, collaboration among farmers, millers, government agencies, and local communities, will foster open dialogue and facilitate the development of viable solutions.
The campaign for zoning sugar farms should be dropped like a hot potato as there are existing contractual agreements between some millers and farmers that must not be disrupted. Breaching these contracts may lead to a legal conundrum. The way forward is incentivising farmers to increase cane production, rehabilitating the existing infrastructure of MSC, and exploring partnerships with other millers to ensure a steady supply of cane to the factories.
Additionally, urgent attention must be paid to the outstanding debts and liabilities of MSC and ensuring transparency in management of funds. A thorough investigation into alleged financial improprieties is crucial to hold those responsible accountable and prevent similar issues from recurring in the future.
Mr Mwenja is an economist and a communications expert
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