Concerns over sugar prices
Lack of duty-free sugar from the Common Markets for Eastern and Southern Africa member states is to blame for the current sugar crisis.
Out 260,000 tonnes of duty-free sugar from Comesa that was expected to be imported into the country from February, only 10,000 tonnes had arrived, Agriculture permanent secretary Romano Kiome said on Monday.
Out 260,000 tonnes of duty-free sugar from Comesa that was expected to be imported into the country from February, only 10,000 tonnes had arrived, Agriculture permanent secretary Romano Kiome said on Monday.
The country annually imports more than 200,000 tonnes of duty-free sugar from Comesa to defray the existing deficit.
Dr Kiome said most of the Comesa countries including Sudan, Swaziland, Mauritius, Madagascar, Malawi and Zambia were exporting their sugar outside the Comesa region.
"Our inquiries have revealed that the current sugar crisis is largely due to lack of the commodity in the Comesa region. Where there is sugar, the companies are fulfilling their long-term contracts with suppliers mostly from Europe," he said.
Dr Kiome said the government was working on a plan to have 250,000 tonnes of duty-free sugar imported from non-Comesa countries.
"This will only be possible after we have made a request to the East African Community and received its approval in line with the existing protocols," he said.
Dr Kiome said the Ministry of Finance had been asked to present Kenya's request for duty-free sugar imports outside Comesa to EAC.
Interviews with other stakeholders revealed that the acute shortage was linked to bureaucracy at the Agriculture ministry, export of 15,000 tonnes of sugar by Mumias Sugar Company to the European market and closure of the company for three weeks for maintenance.
It also emerged that investigations against 20 companies involved in sugar importation over more than Sh1.6 billion tax evasion and delay by the Ministry of Agriculture to issue sugar import licences since July were the major contributors to the acute sugar shortage.
However, Dr Kiome denied allegations that the ministry had delayed processing sugar import licenses.
Some local sugar importers who are being investigated by Kenya Revenue Authority in connection with illegal imports from Egypt had allegedly diverted their imports elsewhere.
KRA has written to more than 20 sugar importers demanding part of the Sh1.6 billion it lost in revenue due to tax evasion.
In April, the Kenya Sugar Board announced it had unearthed a multi-billion shilling sugar importation racket at the Mombasa port.
The sugar regulator said initial investigations indicated unscrupulous sugar importers had been flooding the local market with duty-free sugar from non-Comesa countries and also undervaluing the imports.
Source: allafrica.com