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Farmers and Governors now want sugar board back

By Kepher Otieno
Sugarcane farmer Daniel Mmang'ale at Handidi village in Shinyalu inspects 28 months of mature sugarcane at his farm. [Photo: BENJAMIN SAKWA/Standard]

Farmers and governors from sugarcane growing regions want the defunct Kenya Sugar Board (KSB) re-established in the proposed Sugar Bill.

They say the board will help regulate, develop and promote the industry, which has over the last 10 years been faced with financial woes and mismanagement.

“We want Kenya Sugar Board brought back to streamline policy control, direction, and regulation of the sub-sector, including control of sugar imports,” said Council of Governors (CoG) Chairman Wycliffe Oparanya.

The industry has been riddled with numerous challenges, including non-payment of farmers by sugar companies, increased farm input costs and declining acreage under cane.

If their proposal comes to fruition, the board shall comprise the Principal Secretaries for Agriculture and the National Treasury, and four people nominated by the CoG. Other board members will include five directors and farmers’ representatives.

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The governors spoke during a meeting between the National Assembly Agriculture Committee and CoG to discuss the Sugar Bill 2019.

Privitisation Commission Chairman Paul Otuoma with governors Wycliffe Oparanya (Kakamega) and Anyang’ Nyong’o (Kisumu) during the sugar stakeholders meeting in Kisumu. (Kepher Otieno, Standard)

The governors also suggested that county governments are allowed to register sugarcane growers and traders and also issue sugarcane nursery certificates.

They want to issue sugar milling, jaggery milling, and warehousing licences, currently a preserve of the Sugar Directorate and Kenya Sugar Millers.

These are some of the proposed amendments to the Bill sponsored by Kanduyi MP Wafula Wamunyinyi.

The governors also proposed to offer and coordinate extension services on sugar production and milling in their respective counties.

The proposed laws also seek to re-introduce the sugar development levy on domestic and imported sugar to be used for the development and promotion of the industry.

Suspended National Treasury Cabinet Secretary Henry Rotich had scrapped the levy in the 2016/17 financial year. The levy was charged at four percent of the factory price.

All imports shall be charged on all sugar sales and will be collected by the Kenya Revenue Authority on behalf of the board.

Wamunyinyi wants the levy re-instated as a means to revamp the sugar industry.

The Bill also seeks to entrench into law an agreement that had been reached between sugar stakeholders and the Privatisation Commission that farmers be handed 51 percent stake and directorship of all privatised sugar companies.

Some of the sugar millers that have since been lined up for privatisation are Nzoia, Miwani, Muhoroni, Chemelil, and Sony. 

Privatisation Commission Chairman Paul Otuoma said they were still considering proposals to have at least 51 percent shareholding go to investors.

“25 percent will be reserved for cane farmers and the government 24 percent of the factories are to be sold,” said Otuoma.

Oparanya said with the removal of a sugar development levy, there was no clear funding mechanism for farm inputs and crop husbandry. The governors hope this will be resolved.

They harmonised some of the suggestions in the Bill with recommendations in the task force report.

The report was handed over to President Uhuru Kenyatta in August and is yet to be made public.

 

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