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Citizen Weekly

Sunday, 21 September 2014

NZOIA SUGAR COMPANY LOSING SH120M PER MONTH ON DEALS



The illegal importation and smuggling of cheap sugar from other countries into Kenya has made Nzoia Sugar Company  unable to sell 100,000 metric tonnes of sugar due to lack of market.

Investigations revealed that a total of 80,000 bags of unbranded and another 20,000 bags of branded sugar packaged in 50kg is lying in the warehouse without being bought by businessmen.
The factory’s public relations manager Samuel Simiyu said that the company was losing a total of Sh120 million per month and Sh40 million daily due to unsold sugar.

“It is true that Nzoia Sugar Company is unable to sell 100,000 metric tonnes of sugar due to lack of market following the influx of cheap sugar being imported and smuggled illegally from other countries,” Simiyu said.

He said that previously, the company used to sell more than 10,000 bags of sugar daily unlike the current situation where they were only selling about 500 to 1000 bags of sugar per day.
Simiyu said that the company produces 3,000 metric tonnes of sugar daily which was just lying in the warehouse saying that if the situation continues, the company might be unable to pay salaries of their employees.

He said that a total of 70,000 farmers are contracted to the company adding that the government should impose stiff penalties on unscrupulous businessmen who will be found importing or smuggling cheap sugar into the country through different border points.

Simiyu said that the demand for sugar in Kenya is 600,000 metric tonnes while the production is only 400,000 metric tonnes which is below the required capacity forcing the government to allow recommended businessmen to import the commodity after being given the official authority to go ahead.

“Unscrupulous businessmen take advantage of importing or smuggling the sugar illegally through our border points thus ruining our local sugar industry,” Simiyu said.

The manager said that the company has paid all debts of their farmers after getting a financial support of Sh887 million from the government to pay their outstanding dues.
“We have paid all our cane farmers their money because we got support from the government of Sh887 million to clear their outstanding dues,” Simiyu said.

Simiyu said that many people in Western region depend on sugar adding that the government should put in place strict measures to curb illegal importation and smuggling of the commodity which has been making the price to shoot up after cheap sugar flooded Kenyan market.

The manager said that any sugar impounded by Kenya Revenue Authority officers should be destroyed or confiscated in order to serve as an example to unscrupulous businessmen who were killing the ailing local sugar industry.

He was responding to an incident at Malaba border where Kenya Customs officers impounded two trucks which were smuggling over 1,000 bags of sugar into the country illegally without having proper documents.

The two trucks were transporting sugar from Kakira Sugar Company in Uganda into Kenya when they were intercepted by KRA officers at Malaba border.
Officers from Nzoia Sugar Company, sugar directorate surveillance formerly known as Kenya Sugar Board, Kenya Bureau of Standards and security officers did 100pc verification of the two trucks at Malaba customs yard.

The sugar estimated to cost Sh 3million was heading to Thika town when it was impounded but the two trucks are still being detained at the customs yard.
Meanwhile, customs officers at Malaba border have also impounded a truck which was transporting cigarettes from South Sudan heading to South America.

Investigations done by Weekly Citizen established that the current KRA officers who replaced their former colleagues were doing a commendable job since the introduction of screening all travellers and checking personal vehicles and buses respectively.
According to the new directives from the commissioner of customs, no person is allowed to cross into Uganda without leaving behind the logbook of the vehicle plus a copy of his ID/card or passport.

This is also as a result of the recent incident when the police presidential escort vehicle crossed into Uganda mysteriously without being detected by security officers at Busia border.