The County Government of Kakamega has released Sh300million which will be disbursed to farmers for cane development at a cheaper interest rate compared to what commercial banks and other financial institutions offer.
Governor Wycliffe Oparanya said the farmers will be able to access the funds just a month after applying for the loan.
Oparanya spoke at the county headquarters on Tuesday while signing a Memorandum of Understanding (MoU) with the Commodities Fund Board of Trustees Chairman Samson Okioma. The loans will be disbursed to cane farmers by the Commodities Fund.
“We settled on a government agency to disburse to get rid of politics out of the noble idea. The last time we gave out Sh200million as a loan to farmers for cane development, there was a lot of politics around it,” said Oparanya.
The county boss also announced that sugarcane farmers both contracted by state-owned and privately owner sugar factories will be eligible for the loan.
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Oparanya also announced that the move is to ensure that the county produces enough cane for crushing ahead of Mumias Sugar Company re-launch mid this year, adding that three investors have been identified who want to pump money towards the revival of the company.
“Already three potential investors have submitted their proposals and we are looking at them. In the next two months, we shall have settled on one and hand over the factory to him. What is only delaying the process is the case that was filed in court challenging the leasing process,” said Oparanya.
He added: “We are preparing the ground for the soft landing. We want them to have a constant supply of raw materials so that when the factory starts crushing, it won’t be closed again for lack of cane to crush.”
Mr. Okioma, the Commodities Fund Board of Trustees Chairman said they are up to the task to ensure Mumias Sugar is fully revived in a bid to boost the region’s economy.
“The release of the money is timely. We want to urge farmers to come for the loans and start planting cane afresh since there is hope at the end of the tunnel. With enough supply of cane to sugar millers, we shall be able to revamp the region’s economy and create more job opportunities to the locals,” said Okioma.
He appealed to Oparanya to consider increasing the capitation saying the demand for the cheap loans will be very high and will easily deplete the allocated funds.
So far, at least 76,000 cane farmers contracted by Mumias Sugar Company had uprooted their cane and ventured into other businesses. Only 20,000 farmers in the region are engaged in cane farming.
The cheap loans are part of an initiative Oparanya promised he will give farmers including other incentives like fertilisers and free seedlings to plant in a bid to boost cane production in the region.