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Government ups fight with embattled tea agency bosses

BUSINESS
By Awal Mohammed | April 21st 2021
Agriculture Cabinet Secretary Peter Munya. [File, Standard]

The government has vowed not to leave any ‘tea leaf’ unturned in its effort to reform the tea sector even as it continues to push for implementation of the Tea Act 2020.

This, it notes, will ensure tea farmers get their fair share of the crop and do away with middlemen who have infiltrated the sector.

Agriculture Cabinet Secretary Peter Munya, while addressing editors at a media breakfast in Nairobi yesterday, also termed Kenya Tea Development Agency (KTDA) the biggest impediment to improving the sector.

FOREX EARNER

Mr Munya laid the blame squarely on the private tea agency which he noted had been the sole monopoly that has run down the country’s leading foreign exchange earner over the years.

“The value chain players who have a direct commercial interest in the outcome of the auction process also run the auction, which pre-disposes the auction to insider trading and price-fixing, adding misery to the smallholder farmer,” said Munya.

This comes a few days after detectives from the Directorate of Criminal Investigations’ Serious Crime Unit (DCI) raided KTDA head offices in Nairobi.

The officers took control of the seven floors used by the tea agency at Farmers Building along Moi Avenue, Nairobi.

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The investigators directed staff to move away from their computers and leave the building under the supervision of armed officers.

In a quick rebuttal, KTDA said it had nothing to hide regarding its operations, financial transactions and business.

The tea agency said the DCI invasion had resulted in the unlawful retrieval of computers and hard disks, payment records of 620,000 to farmers, shareholder registers, title deeds and other important records and documents.

“The group states that it is a law-abiding institution and as long as the proper and legal procedures are followed, it will abide by the same,” the agency said in a statement.

Separately, the East African Tea Trade Association (EATTA), the membership club of tea value chain players in East, Central and Southern Africa which manages the Mombasa Tea Auction also protested another DCI invasion at its Mombasa premises last Friday.

In a letter to members, EATTA Managing Director Edward Mudibo said the DCI officers’ raid at their premises on Friday at 3 pm was an affront to the associations’ rights as a private entity.

“We carry out transparent business and we assisted them with everything they needed. At the end of the day, they took about 10 computers and personal phones from our staff on duty. The phones were returned on Monday,” said Mudibo.

COURT ORDERS

At the centre of this bruising battle is the Tea Act that the government has touted as a game-changer and which KTDA had already secured staying court orders in the execution of the act.

The fight came to the fore on March 12, when President Uhuru Kenyatta issued an executive order calling for immediate elections in all tea smallholder factories across the country.

KTDA then rushed to court and got orders to halt the elections.

Interestingly, after the executive order was issued, 24 tea companies led by those from Murang’a County successfully held elections while others have given notice for the same.

CS Munya believes KTDA’s conflict of interest and hiding under the disguise of a private company is what has delayed reforms in the tea sector.

“KTDA has resisted the reforms on the theory that they are a private company, but any company with more than 50 members is a public company and must meet higher disclosure requirements, all legitimate business is subject to regulation,” he said.

The DCI’s Serious Crime Unit is yet to release its report on the investigations they are doing on KTDA.


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