The Kenya National Chamber of Commerce Industry (KNCCI) has asked the government to speed up the privatisation of sugar factories in the country to enable them be competitive.
KNCCI chairman Kiprono Kittony said about 76 per cent of sugar companies in the country are government-owned and should therefore be privatised.
“Let’s not make the sugar issue political, as Kenya will lose its competitiveness globally,” warned Mr Kittony noting that Kenya is a member of Comesa and EAC and also has tripartite agreements with other countries in the region.
He said that the country cannot continue to seek protection forever and instead the government should make the sector more competitive.
He insisted that no agreement on sugar importation was signed during a recent visit by President Uhuru Kenyatta to Uganda.
Instead, it was a memorandum of understanding that was signed.
“We signed a memorandum of understanding on a broad framework of engagement that will allow us to engage with our counterparts in Uganda,’’ said Mr Kittony during an interview on Citizen TV.
He said that the sugar factories are faced with the challenge of ageing equipment and high costs of production noting that Kenyan sugar is the most expensive in the World.
He however, admitted that the chamber is concerned about the role of sugar barons and cartels and asked the government to look into the sugar regime.
Mr Kittony said that the cost of production in the country should be addressed noting that 53 tonnes of sugar are produced from one acre while in Zambia about 100 tonnes are produced per acre.
He also called for diversification to other areas such as co-generation and ethanol production.
The chairman also called for appointment of a substantive Cabinet secretary for Agriculture following the suspension of Felix Koskei early this year.
Mr Adan Mohamed has been the acting CS since then.
However, Nzoia Sugar Company chairman Joash Wamango’li opposed the idea of privatisation of sugar factories, saying that it will not address the challenges facing the sector, one of which is lack of proper management.
‘Let us have managers who can perform and deliver. Privatisation will not save the sector,” said Mr Wamang’oli.
He said Kenya will next year be able to produce surplus sugar as several companies will have increased their production.
Mr Wamang’oli added that a lot of sugarcane that has not been harvested is still in the farms.
HIGH PRODUCTION COST
Kenya National Federation of Sugarcane Farmers chief executive Francis Waswa asked the government to address the high cost of production, from land preparation to harvesting.
Mr Waswa said that politics have taken centre stage in the whole issue at the expense of the farmers.
“Sugarcane farmers have been ignored, mistreated, underpaid and their payment delayed,” added Mr Waswa.
He admitted that the country has not been producing sufficient sugar and was therefore compelled to import.
However, he maintained that the sugar industry in the country is still viable.
He called for the formation of a taskforce to look at challenges facing the sugar industry.
Mr Waswa lamented that some players such as sugarcane transporters are fleecing farmers as there are no regulations.
Kenya consumes 900,000 metric tonnes of sugar per year against an annual output of 600,000 tonnes while Uganda, on the other hand, produced 438,360 tonnes of sugar last year against a demand of 403,874 tonnes.