Kenya lands deal to bar cheap sugar imports
07 December 2015, 21:07
Nairobi - Kenya has been granted a one-year
extension to sugar import limits from a regional trade bloc to give it
time to overhaul its ailing sugar industry, a Kenyan minister said on Monday.
arrangement capping cheaper imports from Common Market for Eastern and
Southern Africa (COMESA) was scheduled to expire in February 2016 but Kenya pleaded for more time to fix its sugar industry.
"This COMESA extension will give interim comfort to the sugar sector in Kenya,
enabling the ongoing privatisation process," Adan Mohamed, minister for
enterprise and industrialisation said on his Twitter feed.
Friday invited bids for the purchase of stakes in five state-owned
sugar companies, as it looks to complete reforms aimed at making its
sugar industry competitive.
The government will sell a 51 percent
stake in the five sugar companies to strategic investors and reserve
another 24 percent for farmers and employees.
about 600,000 tonnes of sugar a year, compared with annual consumption
of 800,000 tonnes. The deficit is covered by strictly controlled imports
Experts have blamed a high cost of production for the woes facing Kenya's
sugar industry. Poorly funded government factories have aging machinery
that is prone to breaking down. The roads in most sugar growing areas
are also in poor shape.
The Kenya Sugar Directorate estimates the cost of producing a tonne of sugar at about $570 in western Kenya compared with $240-$290 in rival producers such as Egypt.
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