State warns sugar ‘cartels’ stifling sector’s growth via series of court cases
By Kepher Otieno, August 8, 2024Agriculture Principal Secretary Paul Rono (pictured) has taken a strong stance against “sugar cartels” in the industry for stifling the sector’s growth, urging them to withdraw court cases to avoid derailing reforms.
The sugar industry in Kenya has long struggled with challenges posed by cartels, which have hindered reforms and contributed to its decline over the past two decades.
Ongoing litigation
Ronoh said the ongoing litigation by these powerful entities is obstructing policy implementation against these forces. “I am asking you people who represent a fraction of farmers to stop these endless litigations in court. It’s not paying off, only dragging us,” he said after an extensive tour of the Muhoroni and Chemelil sugar factories in Kisumu County.
Rono was accompanied by Agriculture and Food Authority (AFA) Director General Bruno Linyiru, Sugar Directorate boss Jude Chesire, and AFA Board member Samwel Ongou.
He warned that the State has been actively working on revitalising the sugar industry but fears some players are out to derail sector reforms.
The PS announced that the Cabinet had approved a waiver of Sh117 billion in debt owed by public sugar firms, clearing all outstanding debts.
This waiver will provide immediate financial relief, allowing public sugar firms to focus on operational improvements and investments rather than servicing debt.
“With a clean slate, these firms can compete more effectively with private millers and reduce financial burdens that may lead to increased productivity, better infrastructure, and improved product quality,” said Chesire, the Sugar Directorate boss.
He echoed the sentiments of Rono and Linyiru, emphasising that the industry reforms and debt waiver are beneficial for the sector.
“This was a good move for us because it aims to give these firms a clean slate and enhance their competitiveness against private millers,” he said.
“With reduced liabilities, they can seek capital injections for modernization, expansion, and diversification,” said Killion Osur, Secretary General of the Kenya National Sugarcane Federation