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Energy Cabinet Secretary Opiyo Wandayi has come out strongly in support of the government’s decision to lease struggling state-owned sugar mills to private investors, terming the move a pragmatic step toward turning around the sector’s fortunes.

Speaking in Nyakach Constituency, Kisumu County, Wandayi noted that state-owned sugar mills have for years relied on unsustainable bailouts, yet continued to post losses.

“These factories have been in a cycle of collapse, with taxpayers shouldering the burden through repeated bailouts,” he said. “It’s time to try a different, sustainable approach.”

Public mills lag behind private counterparts

According to Wandayi, the contrast between state and private sugar mills is stark. Privately-run facilities like Kibos, Butali, West Kenya, and Transmara have consistently made profits, maintained operations, and paid farmers and employees on time—something public factories have struggled to do.

“Private millers are proof that the sugar industry can thrive if run efficiently,” the CS remarked.

Key mills to be leased under PPP deal

The leasing plan, approved by the Cabinet, will operate under a 30-year Public-Private Partnership (PPP) structure. The first phase includes five major mills—Muhoroni, Chemelil, Sony, Nzoia, and Miwani.

Chemelil Sugar Factory has been leased to Kibos Sugar & Allied Industries Ltd, while Muhoroni is now under the management of the Kipchimchim Group of Companies through West Valley Sugar.

The government hopes this arrangement will lead to improved efficiency, financial recovery, and increased reliability in payments to cane farmers.

Concerns raised on jobs, transparency

While the move has been hailed in some quarters, it has also sparked concerns from stakeholders over transparency and the fate of workers currently employed in public mills.

Wandayi acknowledged the concerns and assured the public that stakeholder consultations are ongoing.

“This is not a sale. It is a lease meant to inject new life into our sugar mills. We are listening to concerns and will ensure workers are not left behind,” he affirmed.

bold step amid industry crises

The sugar industry has been in turmoil for years due to mismanagement, mounting debts, and declining productivity. The government now sees private-sector involvement as a long-overdue reform to rescue a vital sector in Kenya’s economy.

“Our people can’t afford to wait any longer. This is about livelihoods and regional economic revival,” Wandayi added.

The leasing programme is expected to attract investment, restore confidence among farmers, and support economic stability in sugar-producing counties.