State likely to cede stake in sugar firms

Chemelil Sugar Company workers and farmers protest delay of payment, at the firm on April 27, 2017. PHOTO | TONNY OMONDI | NATION MEDIA GROUP

What you need to know:

  • Mr Ruto said the manner in which the factories were being run calls for the re-energising of the management.
  • The Deputy President said decisions must be made on how to better manage the sugar industry for the sake of farmers.

The government is ready to surrender its stake in five sugar factories in the country as a measure to streamline the management of the sector, Deputy President William Ruto said.

Mr Ruto said the government is looking into ways of expediting privatisation of Miwani, Muhoroni, Nzoia, Sony and Chemelil sugar factories.

“We have to make changes to the model we are using to manage the sugar sector.

"We have no problem even if it means we surrender our stake in the sugar factories, so long as it will be for the benefit of the sugarcane farmers,” Mr Ruto said.

Speaking during a consultative meeting on the privatisation of the sugar factories held at his Karen office, Nairobi, on Thursday, Mr Ruto said the manner in which the factories were being run calls for the re-energising of the management.

PUBLIC PARTICIPATION

The Deputy President said decisions must be made on how to better manage the sugar industry for the sake of farmers. “The situation where private companies in the sugar industry are making money while the public ones losses shows that there is a problem somewhere which must be fixed.”

Cabinet Secretary Mwangi Kiunjuri (Agriculture), governors Okoth Obado (Siaya), Stephen Sang (Nandi) and Paul Chepkwony (Kericho), Privatisation Commission chairman Henry Obwocha and his National Land Commission Counterpart Muhammad Swazuri were present.

Mr Ruto asked the stakeholders working on the privatisation programme to consult farmers.

He said a meeting of leaders should be held before embarking on consultations based on individual factories, adding the management of each factory has unique challenges.

SHAREHOLDING
The meeting also heard that the five sugar companies debt as at the end of December last year stood at Sh 89.3 billion.

The committee urged the government to write off the debts owned by the public sugar factories.

Mr Obwocha said his commission has proposed that the national government agrees with the respective county governments on the 25 per cent shareholding approved for the retention so that the process can be expedited.