The Challenges and Way Forward for the Sugar Sub-Sector in Kenya

Abstract

Sugar is a political as well as a strategic commodity. The sugar sub-sector is a source of livelihood to over one million people in Kenya. It offers employment and helps in rural infrastructural development. It is a commodity that faces competition from imported sugar under the COMESA protocol or from the residual world market. The cost of production in Kenya is high when compared to other regional producers and world market prices, which – for political reasons – are lower than the production costs in any sugar producing country. The milling firms in Kenya are riddled with a heavy debt burden. The cane yield per hectare in Kenya does not compare well with global trends. In order to deliberate on the challenges facing the sugar sub- sector, Honourable Members of Parliament from the sugar belt and Directors of Kenya Sugar Board were facilitated by the Friedrich Ebert Foundation to attend a workshop at Mombasa on 4th– 5th July 2003. The aim of the workshop was to identify the problems facing the sugar sub-sector and to come up with recommendation on the way forward. This report is written in a book format for ease of reading and to avoid the monotony of reproducing the papers presented in a verbatim format. The aim is also to produce the results of the workshop in an easy to read format where the main points are easily discernible. Members of Parliament have been at the forefront in urging for the revival of the sugar sub-sector. It was through their efforts that The Sugar Act, 2001 was passed. It is due to their interest in having the country deal with the challenges afflicting the sub-sector that the Friedrich Ebert Foundation was only too glad to organize a meeting for them to critically discuss the challenges for the sector. First, we thank the Honourable Members of Parliament from the sugar belt and the Directors of the Kenya Sugar Board for agreeing to leave their busy schedules to deliberate on issues affecting this important sub-sector of the Kenyan economy. We are also grateful to The Minister for Agriculture, Honourable Kipruto Arap Kirwa for The Challenges and Way Forward for the Sugar Sub-sector in Kenya 6 participating at the deliberations and officially closing the session. We are also grateful to The Chair of the Sugar Parliamentary Group Hon Soita Shitanda and Hon Dr Noah Wekesa the chair of the Departmental Committee on Agriculture for their contributions and attendance. Honourable Wycliffe Osundwa played a key role in the conceptualization and organization of this meeting together with my Colleague Collins Odote. I thank them for this. Our gratitude also go to the key resource persons at the meeting Dr Otieno Odek, Peter Kegode and Shem Ochola for not only making excellent presentations but also for preparing this report. Lastly I thank Dr Paul Goodison for also making a presentation at the workshop on the impact of international trade regimes like WTO and COTONOU on the sugar sector in Kenya. It is our hope that some of the recommendations made at the workshop will be implemented to revamp and resuscitate the sugar industry in Kenya.