- The Kenyan government has leased Nzoia Sugar Factory to West Kenya Sugar Company, led by businessman Jaswant Rai.
- Farmers and political leaders express concerns over the lease’s transparency and the investor’s ability to fulfil promises.
- Past experiences with similar leases in the sugar sector have raised scepticism about the effectiveness of such arrangements.
The government has pledged to clear KSh 500 million owed to farmers for cane delivered since 2024 by July 2025. This is in addition to KSh 1.7 billion paid to farmers last year. Additionally, the workers were paid KSh 600 million in 2024 out of the KSh 5.3 billion debt. The current debt is estimated to be KSh 5.6 billion.
Businessman Jaswant Rai, through West Kenya Sugar Company, has committed to reviving the sector by repairing and upgrading factory equipment within the next 30 days. He remarked,
The company has vowed to revive the sector by committing to repair and upgrade factory equipment within the next 30 days for the factory to operate at its optimum. And I also want to assure uh everyone that you will see this nucleus developed to the full extent. Every acre of the nucleus will be planted with cane cause that is what the nucleus is there for to grow cane.
In addition, Alfred Khang’ati, the Chair of Nzoia Sugar Company echoed the taicon’s remarks on KBC channel saying,
We will pay all educated farmers promptly, that is, every week upon delivery of their care. We have also assured the staff that we will pay them monthly for their services.
Despite these assurances, a section of government officials, including Kabuchai MP Majimbo Kalasinga, have threatened legal action to halt the lease, arguing that the process lacked transparency and violated existing court orders. Trans Nzoia Governor George Natembeya criticised the lease, stating it threatens the livelihoods of over 45,000 farmers and the regional economy.
Over the years, Kenya’s sugar industry has faced numerous challenges, including mismanagement, corruption, and outdated equipment. These issues have led to the decline of several state-owned sugar factories.
For instance, Mumias Sugar Company, once a leading sugar producer, experienced significant financial losses due to internal fraud and poor management. A forensic audit revealed that top executives concealed financial irregularities, resulting in losses exceeding KSh1 billion. Consequently, over 50 senior staff members lost their jobs, and the company ended up under receivership.
In 2016, the High Court halted the privatisation of five sugar companies, including Nzoia Sugar Company Limited. Attempts to privatise other sugar factories, such as Chemelil, Muhoroni, and Miwani, have also faced similar setbacks.
Wrapping Up
The leasing of Nzoia Sugar Factory to West Kenya Sugar Company marks a pivotal moment in the country’s efforts to revive the sugar industry. While the government and investors have laid out their plans, the success of this venture will depend on consistent support for farmers and workers.
