A UN agency says the solution to the woes of Kenya’s sugar industry lies in lowering the cost of production and not protecting cane farmers.
UN Conference on Trade and Development secretary-general Mukhisa Kituyi challenged Kenya to make her industries competitive to match international standards.
With the world fast moving towards regional integration, Kenya has no choice but to honour her obligations as a member of regional blocs, Dr Kituyi said.
He was speaking during an interview with NTV on regional trade integration.
Kenya should invest in competitiveness failure to which the market will drive you out of business, regardless of the posturing by the political class, Dr Kituyi said.
Don’t assume protectionism is the answer. Why should Uganda and Malawi be more competitive in growing sugarcane? Dr Kituyi said.
USED AS A CONDUIT
However, Dr Kituyi talked of the need for protection to nurture industries as they improve their competitiveness.
There is a legitimate and politically correct need to nurture a fragile enterprise. If Uganda produces more sugar than it needs, it has a right, under existing agreements, to export it to Kenya without need for new agreements, he said.
But if it doesn’t produce sufficient sugar, then we can conclude some individuals are using Uganda as conduit to smuggle in sugar. We should stop sugar that is coming from countries not in a free trade agreement with Kenya.
Dr Kituyi blamed sugar prices on inefficiencies in farming. Why does ploughing an acre of sugarcane farm using a tractor cost a lot more than maize? We are creating artificial costs.
Meanwhile, the Transitional Authority wants to involved in the process of privatising five sugar firms next month.
Chairman Kinuthia wa Mwangi said the authority has the mandate to take stock of the assets of Sony, Nzoia, Chemelil, Muhoroni and Miwani sugar millers before they are taken up by private investors.