The Kenya Sugar Board (KSB) has issued a firm warning to private investors who have leased four state-owned sugar factories, stating that their leases will be terminated if they fail to meet crucial conditions. These conditions include modernizing the aging sugar mills, actively supporting the development of sugarcane farming, and ensuring that farmers receive timely payments for their produce, reports The Eastleigh Voice.
This development follows the government’s decision to lease these four struggling sugar factories in an effort to revitalize Kenya’s sugar industry.
The mills in question – Nzoia, Chemilil, Sony, and Muhoroni – have been leased for a 30-year period to West Kenya Sugar Company, Kibos Sugar & Allied Industries, Busia Sugar Industry, and West Valley Sugar Company, respectively.
During a meeting held in Nairobi, Jude Chesire, the Chief Executive Officer of the Kenya Sugar Board, emphasized that the primary focus of the leasing arrangement is the welfare of sugarcane farmers.
He made it clear that any failure on the part of the investors to fulfill their agreed-upon obligations would lead to the immediate revocation of their leases.
Chesire explained that the extended 30-year lease term is specifically intended to justify the significant capital investments expected from the private companies. He further noted that the lease and concession fees paid by these investors will be directly channeled back to the farmers in the form of annual bonuses, calculated based on the quantity of sugarcane each farmer supplies.
“Farmers come first,” Chesire asserted. “If investors leasing sugar factories fail to modernise mills, support cane development, or pay farmers weekly as agreed, the government will revoke their leases. A 30-year term is only justified by the heavy capital injection expected.”
He added, “If they don’t deliver, we’ll hand it over to those who truly prioritise our farmers. For every kilo of sugar processed, the lease and concession fees from the four investors will flow back to the farmers.”
However, the takeover of the Nzoia Sugar Factory has triggered protests from leaders in Kenya’s Western region.
Democratic Action Party–Kenya (DAP-K) leader Eugene Wamalwa, Trans Nzoia Governor George Natembeya, and politician Cleophas Malala spearheaded a demonstration involving hundreds of sugarcane farmers and local residents who voiced their strong opposition to the leasing agreement.
These leaders have argued that the lease is illegal and will negatively impact the sugar industry in the region, despite a court order issued on April 23 that had halted the lease to businessman Jaswant Rai.
“We must get to the bottom of this for the sake of our people,” stated Governor Natembeya. “The Nzoia Sugar Company is a critical economic pillar for Western Kenya, supporting over 45,000 farmers and providing livelihoods for millions directly and indirectly.”
He further emphasized his concerns, saying, “I perceive the privatisation or leasing of this institution as a menace to the region’s economy, particularly given its pivotal role in supporting sugarcane farmers and local communities.”
