State plans to privatise Nzoia, Chemelil, Muhoroni and Miwani companies

Cane hauliers carrying burnt cane that has been harvested on a long queue at the Sony Sugar Company.photo: Stanley Ongwae.

The journey to privatising State-owned sugar millers has begun in earnest with governors and farmers opening talks with the Privatisation Commission. 

This follows a court ruling that called for an out-of-court settlement between the three parties.

Efforts to privatise the moribund sugar milling companies and inject some efficiency into their operations have often hit a dead end, with each party seeking to protect its interests.

But last week, commission officials led by acting CEO Jacqueline Muindi were holed up in a closed-door consultative meeting with stakeholders, signalling an easing of the gridlock.

The meeting was aimed at finding ways to meet the conditions laid by the governors, who stopped the privatisation process citing lack of consultation.

Sources from the meeting held in Kisumu told The Standard that neither the farmers nor the governors were really opposed to privatisation; in fact, they supported the new initiative targeting four sugar millers in western Kenya. However, the county bosses insisted that some of the pre-conditions must be fulfilled.

The State plans to privatise Nzoia, Chemelil, South Nyanza, Muhoroni and Miwani sugar companies.

In November, Justice Edward Mureithi dismissed three petitions seeking to stop the sale of the millers but directed the warring parties to seek alternative dispute resolution mechanisms before seeking court intervention.

The judge said while there appeared to be weighty questions presented in court for interpretation of the Constitution with regard to the functions of the two levels of government, the Constitution allowed for smooth relations and alternative dispute resolution methods.

“The Constitution itself prescribes for harmonious resolution of any dispute that may arise between the governments,” said Mr Mureithi.

“For this reason, a course of avoidance by the court is a constitutional imperative, at least until the alternative dispute resolution methods have been reasonably employed without success. Such reasonable efforts towards resolution in the dispute have not been exhausted or failed.”

Kisumu Governor Anyang' Nyong’o, former Gem MP Jakoyo Midiwo and the Council of Governors had separately gone to court in 2016 and challenged the privatisation plans.

Prof Nyong’o and his colleagues from the Nyanza sugar belt want a stake in the licensing and sustaining of the factories.

Days before the judgement, a delegation of Government officials led by Agriculture, Livestock and Fisheries Cabinet Secretary Willy Bett met governors, sugar sub-sector policy stakeholders, millers and farmers in Kisumu for a two-day conference meant to find solutions for the ailing sector.