PUBLISHED ON March 3rd, 2015

Kenya to lock out Comesa sugar imports till April

Kenya will continue to lock sugar from neighbouring states out of its market up to the end of this month as industry regulators await the resolution of Comesa ministers.

Agriculture ministry officials said the sugar market remains controlled until Comesa ministers make the final decision over an appeal that Kenya has lodged with the regional bloc to have safeguards extended for another two years.

“We will soon be making a conclusion, but at the moment we are awaiting the outcome of the Council of Ministers meeting,” Agriculture principal secretary Sicily Kariuki told the Business Daily on Monday.

Comesa’s two-week summit is scheduled to start its sessions on March 18 up to end month in Addis Ababa.

The Comesa safeguards — a deal that has cushioned the local sugar industry from cheap imports from Comesa region over the last 12 years — expired on Sunday, creating anxiety in the local market.

Local firms have said the expiry of the safeguards has exposed them to cheap sugar smuggled from other parts of the world. Agriculture ministry officials have pegged their hopes on the Addis meeting to make the final decision on their push for extra time.

Sugar market regulator, Agriculture Fisheries and Food Authority (AFFA), said Kenya can only take a firm stand after the bloc’s final decision.

“This (application for extension) is work in progress. The matter is one of the items on the agenda in the Council of Ministers meeting and we hope for a positive judgment,” said AFFA boss Alfred Busolo said.

The decision to maintain the ban on sugar imports beyond the official timeline is likely to trigger tit-for-tat market access wars with states like Egypt, Sudan and Uganda which are eyeing the local sugar market.

The three states are huge markets for Kenya’s exports such as tea and building materials.

Kenya has said it requires extra time to implement a raft of reforms that the Comesa Secretariat has asked for since 2003.

Among the conditions is privatisation of State-owned millers and diversification of their revenue streams.

It was only last week that Parliament approved sale of public sugar firms, paving the way for the long process of privatisation to start.

Source: Business Daily

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