The Kenyan government announced plans to disburse Sh2.7 billion to sugarcane farmers in March 2019, settling outstanding debts from deliveries to state-owned mills between 2014 and 2017. The funds, allocated by the national treasury to the agriculture ministry, target unpaid contracts for mills including Mumias Sugar (Sh889 million), Sony Sugar (Sh512 million), Muhoroni-Miwani (Sh474 million), Chemelil Sugar (Sh201 million), and Nzoia (Sh524 million).
Agriculture Cabinet Secretary Mwangi Kiunjuri confirmed the payments, stating they marked a shift from years of delayed compensation. "This is set to change as our farmers will be smiling all the way to the bank," he said after meeting with ODM leader Raila Odinga. Kiunjuri emphasized ongoing privatization efforts to revive struggling mills, calling it essential for industry sustainability.
Odinga highlighted systemic issues in the sector, citing corruption and mismanagement as root causes of financial distress. He outlined plans for a Kisumu stakeholders' meeting to finalize privatization strategies, noting private investment could modernize mills like Chemelil, Muhoroni, and Nzoia. "A permanent solution requires structural changes," he stated, stressing the need for sustainable production models.
The government's approach includes transferring underperforming mills to private operators, with Odinga advocating for new capital and technology to revive companies on the brink of collapse. The final privatization details will be discussed at a March 2019 meeting, following years of stalled reforms.
