Sugar imports from Uganda to come under Comesa rules (Business Daily (Kenya))


Sugar imports from Uganda will only be allowed under the Common Market for Eastern and Southern Africa (Comesa) rules and not any other special arrangement, the government said Thursday.

Acting Agriculture secretary Adan Mohamed said Uganda has been selling sugar to Kenya under the Comesa and the East African Community (EAC) Customs Union rules, and that the agreement alluded to when President Uhuru Kenyatta recently visited the neighbouring country did not imply that this would change.

“Being a member of Comesa, Uganda is entitled to access Kenyan market on Comesa treaty terms,” Mr Mohamed said at a press briefing Thursday.

Under the Comesa rules, member states are allowed to export their surplus sugar to supply-deficient member as per pre-set quotas.

Mr Mohamed said that Uganda has remained Kenya’s key business partner in the region, with trading interests in banking, insurance and commodities such as maize.

The government statement came in the wake of a heated debate involving government officials and Members of Parliament from the western Kenya sugar-growing belt who have accused the State of signing a trade deal that would see excess sugar from Uganda access the local market.

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Such imports, the MPs have argued, could depress local prices making it impossible to revive struggling millers such as Mumias. Mr Mohamed said that he was issuing official communication to the country that no trade deal on sugar was reached during the three-day State visit by Mr Kenyatta to Uganda.

Addressing a news conference Thursday, Mr Mohamed said Kenya has been receiving the bulk of its sugar imports from other Comesa states, with Zambia accounting for 70 per cent of the supplies.

The Cabinet Secretary said that given Kenya’s sugar-deficit situation, the commodity is first sourced from the EAC countries, while the balance comes from Comesa states before imports are allowed from overseas markets.

Sugar factories in the country are undergoing operational difficulties that have seen some operate at 30 per cent of their installed capacity.

The stocks of sugar held by millers have fallen below the country’s optimum level, with most factories milling below their required capacities due to inefficiencies.

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As at Wednesday, the volume of sugar in all the 11 factories had dropped to 5,000 tonnes, way below the required stocks of 9,000 tonnes that should be held by the millers at any given time.

But the acting agriculture minister expressed optimism that the production levels will rise in the coming days when Mumias, which is on maintenance now, resumes operations in the next two weeks.

Kenya depends on states in the region to bridge the shortage by allowing importation of 200,000 metric tonnes to meet the difference. Kenya produces about 600,000 tonnes annually against the requirement of 800,000 tonnes.

Comesa has given Kenya a one-year extension on sugar import safeguards from the regional states, limiting the entry of sweetener into the country.

These conditions for the Comesa safeguards included privatising State-owned mills, researching new early-maturing and high sucrose content sugarcane varieties and adopting them, and paying farmers on the basis of sucrose content instead of weight.

Other Comesa member states outside the EAC where Kenya acquires its sugar are Egypt, Zimbabwe and Swaziland.

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