Auction sugar estates, hotels to highest bidder

In Summary

• A privatised business pays taxes to government and salaries to workers.

• Do local people have the capacity to manage a giant sugar estate?

A sugarcane farm in Migori county
A sugarcane farm in Migori county
Image: FILE

Yesterday senators grilled Treasury Public Investments director Stanley Kamau over government plans to privatise loss-making sugar estates and hotels (see P8).

They want counties and local people given the first opportunity to take over these assets.

Firstly, let us all agree that there is no point in government continuing to subsidise sugar estates like Chemelil, Muhoroni and Nzoia. It would be much better to use this money to increase teachers' salaries or to speed up repayment of our Chinese debt.

Secondly, there is no strategic reason for government to own hotels that compete unsuccessfully with the private sector. 

Thirdly, privatisation will benefit everyone. If a sugar estate is revived, it will pay taxes to government and salaries to workers. Money will be injected into the economy. From a macro-economic perspective, it does not matter who owns a sugar estate so long as it is profitable.

Fourthly, do counties or local people have the capacity to manage a giant sugar estate? They will probably still demand subsidies from central government to keep it afloat.

Treasury CS Henry Rotich should not be deflected. Government should sell these loss-making parastatals to the highest bidder.

Quote of the day: "War is peace. Freedom is slavery. Ignorance is strength."

George Orwell
His book Nineteen Eighty-Four was published on May 8, 1949