Kenya to proceed with plan to lease state-owned sugar mills amid workers’ protests

KENYA – Kenya’s Agriculture Principal Secretary, Kiprono Rono, has reaffirmed the government’s commitment to leasing four state-owned sugar factories in the Western and Nyanza regions.  

The move aims to revitalize the struggling Nzoia, Chemilil, Sony, and Muhoroni sugar mills by introducing private investors. 

Rono assured farmers and factory workers that they would receive payments for outstanding arrears within three months.  

“We aim to get these mills back on track for the benefit of the locals, which can only be achieved by allowing private investors to take over. All unpaid farmers and factory workers in the four mills will be compensated within three months,” he stated. 

However, the decision has sparked opposition from farmers and some leaders in sugarcane-growing zones, who fear that leasing the mills could lead to exploitation. 

Adding to the tension, sugar industry workers have demanded Kes600 million in unpaid arrears, emphasizing the need for immediate government intervention. 

The Kenya Union of Sugarcane Workers, led by Secretary General Francis Wangara, has criticized delays in disbursing funds.  

Wangara explained that Kes600 million (US$4.6M) out of a Kes5 billion (US$38.68M) debt owed by government-owned sugar firms had been approved for inclusion in the supplementary budget.  

“The communication we got was that each of the four factories would receive Kes150 million (US$1.16M) to pay workers’ arrears. However, no payments have been made so far,” Wangara said. 

Workers also expressed dissatisfaction with President William Ruto’s recent visit to the region, during which he pledged Kes150 million (US$1.16M) to Nzoia Sugar Factory workers but did not address arrears at the other three mills.  

“When workers hear that Nzoia factory is going to be paid, they will accuse the national chairman of favoring his people and abandoning others,” Wangara observed. 

In July 2024, the Ministry of Agriculture approved a budget of Kes654 million (US$5.1M) for the 2023/2024 fiscal year to aid struggling sugar mills.  

Of this amount, Kes354 million (US$2.7M) was allocated to settle debts owed to farmers at Nzoia, Muhoroni, Chemilil, and Sony mills.  

An additional Kes150 million (US$1.16M) was earmarked to clear three months of salary arrears for Nzoia workers, while the remaining Kes150 million (US$1.16M) was designated for similar arrears at other factories. 

At the beginning of 2024, five state-owned sugar companies had outstanding debts totaling Kes128.07 billion. 

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