For more than a decade, Kenya has managed to circumvent the wholesale importation of duty-free sugar by lobbying Comesa — Africa’s biggest trading bloc — for more time to reform the sector and make it competitive enough to withstand cheaper sugar imports.
Duty-free imports should have started flowing into the country in 2000 when the bloc became a free trade area. However, Kenya requested and won safeguards against the imports until 2003. When the threat loomed again, Kenya pleaded for more time and was given an extension of the protection until December 2007, when it sought, and was granted, another extension until March 2012.
One might think ten years is ample time for a country to restructure high cost sugar mills into profitability and sell them to private investors. One might also be forgiven for thinking that a decade would allow a country to identify where sugar-cane can be grown through irrigation, allowing an all year round chain that yields sugar faster without having to rely on the costly outfield growers.
The time would also be adequate for a legislative framework to be put in place improving the governance structures in the sector and allowing millers to squeeze as much value as possible from the cane through activities like power generation, alcohol production and even the making of fertilisers.
In the case of Kenya, however, a decade has proven not enough to achieve these seemingly simple tasks except at the policy level where the regulatory regime has been streamlined.
Unfortunately, decisive action on the policy blueprints has lacked, bringing the country on the verge of having to ask for another extension. Whether Kenya will be third time lucky is neither here nor there.
With its clout in regional trade and politics, Kenya may as well be granted anything it wishes. However, it would be foolhardy to assume that the Lusaka secretariat’s patience is an elastic virtue that can be stretched infinitely. Even if it were, Kenya needs to prove that it is serious in honouring commitments it made to its partners.
More significantly the reforms in the sugar sector need to be expedited to ensure the value chain, particularly farmers who are at its base, reap the utmost returns from the investments made.