Kepsa supports government plans to privatise cane millers

The Kenya Private Sector Alliance (Kepsa) has backed plans to lease five state-owned sugar millers.

Kepsa CEO Carole Karuga said the leasing of the cane millers, two of which are under receivership, would improve the competitiveness of the country’s sugar sector.

Ms Karuga said the bid to lease Chemelil Sugar, Miwani Sugar, Muhoroni Sugar, Nzoia Sugar and South Nyanza Sugar companies would benefit all stakeholders across the value chain, including farmers.

She said Kepsa was one of the stakeholders that had recommended leasing of the debt-ridden sugar mills to private investors two years ago, to give them a new lease of life.

.

Keep Reading

• Ditching maize for bananas
• Regulator to register avocado packhouse dealers in crackdown
• State told to empower youth through agriculture investments
• El Nino floods deal major blow to farmers

"We, therefore, welcome the government's move. We are confident that with the right strategic investors on board, the sector will return to profitability,” Karuga said.

She added that leasing the mills would enable the private sector to mobilse resources to rehabilitate and modernise existing facilities.

The five millers have had loss-making streaks for more than a decade. Previous interventions by the government, including bailouts, have not been successful.

However, the proposal of leasing the factories is facing opposition from the Kenya Union of Sugar Plantation and Allied Workers (Kuspaw) who say the decision was arrived at without the involvement of all stakeholders in the sector.

The Employment and Labour Relations Court in Kisumu last week issued Kuspaw with a temporary injunction against the leasing of the State-owned sugar factories.

The union said the government owed their members Sh5 billion in salary arrears and wanted that cleared before bids for the sugar factories were considered.

Nevertheless, Kepsa said leasing the factories was the best move and would position Kenya to compete with its rivals, especially with the impending end to sugar import quotas from Comesa.

“Kenya cannot continue asking for extensions of the Comesa deadline,” Ms Karuga said.

Under the proposed move, the winning bidders will lease the factories for at least 25 years, operate them and produce sugar as private entities while the State will continue owning the assets.

This arrangement will enable the sugar sector to be as competitive as other agricultural sectors, such as tea and coffee, that are great contributors to the country’s GDP.

.

Keep Reading

• Successful Cucumber farming on leased land - Youth in Agriculture
• From humble beginnings to producing Cherry Tomatoes sustainably - Youth in Agriculture
• Climate smart water management and sustainable development for agriculture
• A tree planting generation that is passionate about climate