HOSTILE ENVIRONMENT

Kibos Sugar to move out of Kenya over volatile working conditions

Governor Anyang Nyong’o opposes the plan, says relocation will hurt the county's economy.

In Summary

• Kisumu county risks losing more than 500 job opportunities should Kibos Sugar move its Sh2 billion milling plant.   

• The company director Raghbir Singh said that the refinery plant established four years ago has not been operated due to bureaucratic challenges. 

Kisumu Governor Anyang Nyong'o with Kibos Sugar and Allied Industries Limited company director Raghbir Singh
Kisumu Governor Anyang Nyong'o with Kibos Sugar and Allied Industries Limited company director Raghbir Singh
Image: MAURICE ALAL
Kisumu Governor Anyang Nyong'o when he visited Kibos Sugar and Allied Industries Limited
Kisumu Governor Anyang Nyong'o when he visited Kibos Sugar and Allied Industries Limited
Image: MAURICE ALAL
Kisumu governor Anyang Nyong'o at Kibos Sugar and Allied Industries Limited
Kisumu governor Anyang Nyong'o at Kibos Sugar and Allied Industries Limited
Image: MAURICE ALAL
Inside one of the factories of Kibos Sugar and Allied Industries Limited
Inside one of the factories of Kibos Sugar and Allied Industries Limited
Image: MAURICE ALAL

Kibos Sugar and Allied Industries Limited in Kisumu plans to relocate to a neighbouring country over what they term a volatile working environment.

The firm, located at the Kibos area, in Kisumu East subcounty, is working on the relocation plan but has yet to say which country in the region they will pitch tent.

Kisumu county risks losing more than 500 jobs should Kibos Sugar move its Sh2 billion sugar milling plant.   

The company director Raghbir Singh said that the refinery plant established four years ago has not been operated due to bureaucratic challenges. 

Singh did not explain the challenges that have made it difficult for the plant to operate.

“We are going to seek space in a country which is friendly to investors,” he said.

Singh said that Kisumu Governor Anyang Nyong’o has opposed the idea to relocate the company.

We have discussed the plan with the governor. The investment has not picked off. The discussion is ongoing to assist us on how the investment can be sustained,” he said.

The governor, he said, has promised to look into the matters which are forcing them to vacate the county and invest elsewhere.

On Monday, Nyong’o visited the company that has been accused of polluting River Kibos.

Locals have accused the firm of discharging raw effluents into the river and its surroundings. 

But the company maintains that they have fully complied with environmental laws.

Nyong’o said the plan to relocate the factory will hurt the region’s economy as most workers will be laid off.

He pledged to engage the national government and other relevant authorities to ensure the matters raised are addressed amicably.

I think it will be shameful to see this factory relocate elsewhere. This is a competitive world. Our neighbours are looking at these factories, they are envious and jealous and if they go, we will be losers,” Nyong’o said.

The governor, however, noted that it would be difficult to convince the investor to stay if the business is not growing to their expectations.

Nyong’o said that there is no need to talk about creating economic zones when a factory that should be part of that zones is decamping.

The relocation, he said, will send a bad signal to the international market and investors in general.

I have been trying to persuade the investors that relocation is not a good idea. But economics is not based sentiments. The bottom line is shillings and cents so if you’re not getting your shillings and cents he will go however much you plead,” Nyong’o said.

Kibos Sugar and Allied Industries Limited is the biggest investment in the entire lake region.

Its other companies are Kibos Distillers Limited, Kibos Paper Packaging Limited, and Kibos Fertilisers Limited.

In July, the Lands and Environment Court ordered the closure of Kibos Sugar Factory over environmental pollution following a successful petition by Kajulu Residents.

Three Kisumu East residents Benson Adega, Erick Ochieng' and Bether Opiyo had sued Kibos, the National Environmental Management Authority and the county government. 

This court found that Kibos's Environmental Impact Assessment licences were illegally acquired.

On October 31 last year, Justice Kibunja granted interim orders stopping the company from milling sugarcane, producing power and distilling alcohol pending hearing of the case.

But the company appealed the decision in an Eldoret court and received orders to continue operating.

In February, Nema shut down two plants at the company following complaints by residents about pollution.

(edited by O. Owino)