The High Court in Nairobi has dismissed a petition challenging the government’s decision to lease four public sugar factories to private investors, paving the way for their privatisation. The ruling, delivered by Justice Chacha Mwita, clears legal hurdles that had delayed the process and signals a major step in the government’s efforts to revive the struggling sugar industry.
The petition, filed by Martin Nyongesa Baraza in February last year, argued that the leasing decision lacked public participation. Baraza contended that Kenyans were not adequately involved in deciding the fate of the sugar factories and that the government’s move undermined public interests. However, Justice Mwita ruled on Friday that sufficient public participation was conducted, allowing the privatisation process to proceed.
The four sugar factories set for leasing include Nzoia Sugar Company Limited, Chemelil Sugar Company Limited, Muhoroni Sugar Company Limited, and South Nyanza (Sony) Sugar Company Limited. These millers have been facing financial challenges, with mounting debts, inefficiencies, and operational struggles that have hampered their ability to sustain production and support sugarcane farmers.
The Kenyan government has maintained that privatisation is the best course of action to rejuvenate the sector. According to officials, leasing the companies to private investors will improve efficiency, inject fresh capital, and enhance the overall competitiveness of the sugar industry. Additionally, they argue that private sector involvement will reduce the financial burden on taxpayers and ensure that farmers receive better prices and timely payments for their sugarcane deliveries.
The decision is expected to have a significant impact on stakeholders, including farmers, workers, and local communities that depend on the sugar industry for their livelihoods. While some stakeholders support privatisation as a solution to the factories’ persistent woes, others remain skeptical, fearing job losses, exploitation, and potential monopolisation of the sector by a few powerful entities.
The sugar industry plays a crucial role in Kenya’s economy, providing employment to thousands and contributing to the country’s food security. However, years of mismanagement, corruption, and inefficiencies have left many state-owned sugar factories struggling to remain operational. The government’s move to privatise these firms aligns with broader economic reforms aimed at improving state-owned enterprises’ performance through private sector participation.
With the legal barriers now removed, the privatisation process is expected to gain momentum, with the government expected to invite private investors to take over the management and operations of the four sugar factories. The coming months will be crucial in determining whether this move will indeed bring the much-needed transformation to Kenya’s sugar sector or spark new controversies and resistance from affected stakeholders.
