The Kenyan government had this grand idea to privatize State-owned sugar companies. But guess what? The whole plan blew up in their faces thanks to a rebellion from leaders and sugarcane farmers in the sugar-belt region. Talk about a major oops!
Now, let me introduce you to Deputy President Rigathi Gachagua, who spoke up about the situation. He mentioned that Kenyans and sugarcane farmers weren’t too thrilled about the whole privatization idea. Instead, they preferred a leasing model. Can you blame them? Sometimes change isn’t all it’s cracked up to be, especially when it comes to something as sweet as sugar.
During an intergovernmental budget and economic council meeting, Mr. Gachagua spilled the beans that the Ministry of Agriculture had listened to the farmers and leaders. They’re now teaming up with Attorney-General Justin Muturi to figure out this whole leasing thing. It’s like a match made in sugar heaven.
Oh, and get this: the Ministry managed to knock down five court cases that opposed the privatization plan. But hold your horses, folks. There are still three cases hanging in the balance, waiting for their day in court. Drama, drama, drama!
The CS for Agriculture, Mr. Mithika Linturi. He wants to reassure everyone in the sugar-belt region that the government isn’t planning to sell off any State-owned sugar mills. Phew! Linturi wants to find alternative strategies to save the day and bring back the moolah for the ailing sugar industry. He even claims that those pushing for privatization have some sneaky motives, like trying to snatch up land near the factories. Can you believe it?
The struggling State-owned millers that were on the chopping block include Chemelil Sugar, South Nyanza (SONY), Nzoia, Miwani, and Muhoroni. They were like the underdogs in a sugar-coated soap opera.
Let’s take a trip back in time, folks. Back in the day, former President Uhuru Kenyatta set up a task force to recommend privatizing these troubled sugar companies. Fast forward to now, and we’ve got opposition left, right, and center. People are not happy, especially after President William Ruto’s Cabinet approved the Privatization Bill 2023. The bill aims to speed up the sale of State-owned corporations without getting a thumbs-up from Parliament. Yikes!
Leaders from the sugar-belt region were all up in arms about this privatization plan. They argued that it would only benefit the corrupt and leave everyone else in the dust. Vihiga Senator Godfrey Osotsi didn’t mince his words. He believed it was a well-orchestrated scheme that would only help a few lucky individuals while leaving thousands of hardworking residents who relied on sugarcane farming in the lurch. Osotsi even made a good point that the local folks should have a say since some of those factories are actually on community-owned land.
Boni Khalwale, a senator from Kakamega, had his own take on things. He claimed that the sugar sector’s only chance of survival was to stop importing cheap sugar and protect the local mills. Who needs imported sweetness when we’ve got our own sugarcane, right?
President Ruto made an announcement in April that he’d be wiping away the debts amounting to a whopping 60 billion shillings owed by the five sugar factories, along with Mumias Sugar Company. He wants to give ownership back to the local communities, make some serious dough, and create job opportunities. Now that’s what I call a sweet deal!
Believe it or not, plans for privatizing these sugar companies have been in the works since 2015. The Privatization Commission gave the thumbs up to sell the government’s shares in five sugar firms. Then, in 2020, former Agriculture Cabinet Secretary Peter Munya spilled the beans that they were prepping to lease these troubled sugar mills to private investors. It was all part of a master plan to bring these mills back to life before the government bids farewell to the sugar sector.
Oh, and by the way, Munya mentioned that the government kindly forgave the mills’ loans worth a jaw-dropping 58 billion shillings. They even waved goodbye to a tax liability of 4 billion shillings owed to the Kenya Revenue Authority (KRA), including all those pesky tax penalties and accumulated interest. Talk about generosity!