A Sh90 million loan borrowed by Embu farmers for the construction of a coffee mill five years ago has ballooned to Sh130 million due to accruing interest.
Now, area leaders want President Uhuru Kenyatta to intervene and bail out the farmers and save the farmers more penalties.
And the construction of Kavutiri coffee mill has stalled. Members of 24 cooperative societies borrowed the money.
On Saturday, Senator Njeru Ndwiga, MPs Cecily Mbarire (nominated) and Erick Muchangi (Runyenjes), among others, were concerned that farmers earned little money from coffee as deductions to repay the loan are punitive.
The spoke during a funds drive for Kevote Catholic Parish presided over by Health Cabinet Secretary Sicily Kariuki on behalf of President Kenyatta. The money is for the construction of the priests' house.
Muchangi said, “The debt has increased to about Sh130 million. We appeal to the President so that farmers can be relieved of this heavy burden.”
Mbarire recalled that the loan was facilitated by CS Kariuki when she was Agriculture Principal Secretary.
She was concerned that farmers might not repay the loan given the prevailing coffee market conditions, hence the need for government intervention through a debt waiver as it has done in other parts of the country.
Ndwiga also called for the waiver and at the same time called on leaders of coffee societies to be accountable.
He commended the government for introducing new regulations in the coffee sector under which farmers will be paid promptly.
In early August, the county assembly held the societies responsible for repaying the coffee mill's loan.
The assembly said it was not its responsibility to bail out the 24 cooperative societies.
The assembly's Agriculture Committee chairperson Elizabeth Kibai said in response to concerns raised by Ruguru-Ngandori ward representative Muturi Mwombo that the 24 societies had in 2008 resolved to set up the coffee mill.
The societies borrowed Sh90 million from the Commodities Fund in 2014 to purchase milling equipment.
Each mill's contribution was 765 shares and was expected to pay Sh3.825 million towards the repayment of the loan.
