Fix sugar industry woes
Kenya needs to lower its cost of producing sugar by almost 40 per cent if it is to be competitive with other Comesa countries. The one-year extension of the protection of Kenyan sugar factories against cheaper imports from the Comesa region may be music to their ears, but it is hardly the solution. GRAPHIC | NATION
What you need to know:
- This protectionism only masks the reality of inefficiency and the high costs weighing down the sugar companies.
- The truth is that the southern African countries and the two Sudans have been able to increase efficiency in sugar production as ours has steadily declined.
The one-year extension of the protection of Kenyan sugar factories against cheaper imports from the Comesa region may be music to their ears, but it is hardly the solution.
The sugar industry has been in the doldrums for a long time, partly because the cost of production by far exceeds that of the competitors.
This protectionism only masks the reality of inefficiency and the high costs weighing down the sugar companies.
It is unlikely that the grace period given to Kenya to turn around the fortunes of the five State-owned companies will make any difference.
The truth is that the southern African countries and the two Sudans have been able to increase efficiency in sugar production as ours has steadily declined.
Farmers’ morale is at an all-time low because of the failure to pay them on time for their cane.
However, the grace period must be used to institute tangible reforms.
If the problem is the rain-fed cane that takes too long to mature, then alternative varieties must be sought.
In this era of greater regional integration, protectionism is anathema.
If it is, indeed, the case that we cannot produce sugar competitively, then we must find something we can do better.
