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September 25, 2018

KIPKULEI: Good governance essential in fixing sugar sector

Mumias Sugar Company Limited
Mumias Sugar Company Limited
Kenya boasts of the most diversified economy in the East and Central Africa, with agriculture as ‘backbone of the economy’ remaining the biggest contributor. The Food and Agriculture Organization notes that agriculture contributes 26 per cent to Kenya’s gross domestic product, and employs over 40 per cent of the Kenyan population, over 70 per cent of that being in the rural areas.

Agriculture also accounts for 65 per cent of Kenya’s export earnings, while also being the main driver of the non-agricultural economy, including manufacturing, transportation, energy, healthcare, tourism, entertainment, and construction.

 The implication is that any change in the sector has significant effects on the economy. A rise in performance leads to a better economy, while a dip equally has a direct impact on the country’s poverty dynamics. So vital is agriculture in the development of Kenya that in crafting his legacy plan, President Uhuru Kenyatta has identified two pillars of the Big Four whose realisation is majorly dependent on agriculture.

 With Kenya being a land of diverse climatic zones, we are blessed with different agro-economic zones, with the sugar belt being one of the major ones. The sugar belt traverses at least 18 counties spread across the former Nyanza, Western and Rift Valley provinces and for decades during its heydays, it was the economic bulwark of the region. It directly supported over six million Kenyans and contributed massively into the national government purse.

 This sector not only supported farmers but also provided direct income to factory workers, transporters and alongside the paper industry, it was the nucleus that supported the economies of the towns spread across the region. In the midst of this prosperity, livelihoods were good if not enviable. From the good earnings, farmers were able to improve the quality of sugar production and enhance yields to factories. They could meet their basic needs and those of their dependents with relative ease.

 Sadly, however, over the past few decades, the sector has experienced a decline with the sugar farming particularly bearing the brunt of this dip. The once thriving sugar factories are now shells of their former selves and many are faced with threats of closure. Disillusioned sugar farmers are now resorting to alternative farm use methods, with many of them no longer seeing any meaningful benefit in farming. The economies of the sugar belt are now crippled with poverty and despondency being the order of the day.

 Several factors can be attributed to this decline but the foremost reason is the poor sugar governance frameworks, the disenfranchisement of the farmers and the flooding of the Kenyan market with imported sugar. With the biggest casualties of this decline being the state-run factories, which have been driven to their knees, there has been a notable rise of private sugar milling industries that have however complicated things and compounded the suffering of the farmers. This is mainly due to rogue business practices by these industries, which have taken advantage of the weak sugar laws to flout rules including environmental regulations and fair trade practices.

 The concept of sustainable economic development calls for development processes that not only take care of economic factors but also consider social and ecological concerns. The basic principle of sustainable development is that development should not only address the needs of the present but also protect those of future generations by taking everyone on board, ensuring good governance and conserving the environment.

 The sugar sector suffers from the lack of sustainable economic thinking and this partly explains why it is on decline. In Busia county for example, evidence has emerged of a private sugar industry that is operating without complying with environmental regulations and drains waste into rivers. This leads to contamination, endangering human lives, while also threatening the fish industry, which is the alternative economic mainstay in the sugar belt. This is alongside delays in remitting payments due to farmers, thus creating urgency of implementing laws to ensure compliance and protection of farmers.

 With national attention now focusing on the need to urgently fix the ailing sector, policy efforts must also address the operation of private industries, which in trying to fill the gap left by the state-run companies must be compelled to operate within the law, conserve the environment and respect the farmers, who are the primary players in the industry.

 

ThKenya boasts of the most diversified economy in the East and Central Africa, with agriculture as ‘backbone of the economy’ remaining the biggest contributor. The Food and Agriculture Organization notes that agriculture contributes 26 per cent to Kenya’s gross domestic product, and employs over 40 per cent of the Kenyan population, over 70 per cent of that being in the rural areas.

Agriculture also accounts for 65 per cent of Kenya’s export earnings, while also being the main driver of the non-agricultural economy, including manufacturing, transportation, energy, healthcare, tourism, entertainment, and construction.

 The implication is that any change in the sector has significant effects on the economy. A rise in performance leads to a better economy, while a dip equally has a direct impact on the country’s poverty dynamics. So vital is agriculture in the development of Kenya that in crafting his legacy plan, President Uhuru Kenyatta has identified two pillars of the Big Four whose realisation is majorly dependent on agriculture.

 With Kenya being a land of diverse climatic zones, we are blessed with different agro-economic zones, with the sugar belt being one of the major ones. The sugar belt traverses at least 18 counties spread across the former Nyanza, Western and Rift Valley provinces and for decades during its heydays, it was the economic bulwark of the region. It directly supported over six million Kenyans and contributed massively into the national government purse.

 This sector not only supported farmers but also provided direct income to factory workers, transporters and alongside the paper industry, it was the nucleus that supported the economies of the towns spread across the region. In the midst of this prosperity, livelihoods were good if not enviable. From the good earnings, farmers were able to improve the quality of sugar production and enhance yields to factories. They could meet their basic needs and those of their dependents with relative ease.

 Sadly, however, over the past few decades, the sector has experienced a decline with the sugar farming particularly bearing the brunt of this dip. The once thriving sugar factories are now shells of their former selves and many are faced with threats of closure. Disillusioned sugar farmers are now resorting to alternative farm use methods, with many of them no longer seeing any meaningful benefit in farming. The economies of the sugar belt are now crippled with poverty and despondency being the order of the day.

 Several factors can be attributed to this decline but the foremost reason is the poor sugar governance frameworks, the disenfranchisement of the farmers and the flooding of the Kenyan market with imported sugar. With the biggest casualties of this decline being the state-run factories, which have been driven to their knees, there has been a notable rise of private sugar milling industries that have however complicated things and compounded the suffering of the farmers. This is mainly due to rogue business practices by these industries, which have taken advantage of the weak sugar laws to flout rules including environmental regulations and fair trade practices.

 The concept of sustainable economic development calls for development processes that not only take care of economic factors but also consider social and ecological concerns. The basic principle of sustainable development is that development should not only address the needs of the present but also protect those of future generations by taking everyone on board, ensuring good governance and conserving the environment.

 The sugar sector suffers from the lack of sustainable economic thinking and this partly explains why it is on decline. In Busia county for example, evidence has emerged of a private sugar industry that is operating without complying with environmental regulations and drains waste into rivers. This leads to contamination, endangering human lives, while also threatening the fish industry, which is the alternative economic mainstay in the sugar belt. This is alongside delays in remitting payments due to farmers, thus creating urgency of implementing laws to ensure compliance and protection of farmers.

 With national attention now focusing on the need to urgently fix the ailing sector, policy efforts must also address the operation of private industries, which in trying to fill the gap left by the state-run companies must be compelled to operate within the law, conserve the environment and respect the farmers, who are the primary players in the industry.

 

The writer is a governance expert [email protected]


 

 


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