State to lose billions as Kibos Sugar set to relocate to Rwanda – Weekly Citizen

Panic has gripped Western Kenya sugar farmers after word leaked out that Kibos Sugar and Allied Industries is relocating to Rwanda.

Already, over 500 workers fearing to lose their jobs are planning a major demonstration to Governor Anyang Nyong’o’s office. Also said to be worried are sugarcane farmers who have been serving on cane delivery to the firm after the closure of Muhoroni and Chemilil. The situation on ground is tense.

Oparanya

Apart from staff and farmers, the government is set to lose a cool Sh2 billion the firm has been paying to Kenya Revenue Authority in form of taxes. KRA Commissioner General is James Gathii. Since he took over, Gathii has been working on modalities to raise tax collections by sealing loopholes that has won him accolades.

It will be a big blow to KRA if Kibos relocates as it will also affect government privatisation of ailing public sugar industries.

The management claims it is set to close and relocate its refinery section due to a poor and hostile business environment in the country. Over 1500 jobs are now at stake.

According to managing director Bhire Chatthe, the firm has held discussion with relevant government organs to address the matter.

Aware of the repercussions, Nyong’o recently visited the firm and held talks with the management. A source within the firm claimed that the governor urged the management to go slow on the relocation bid as he addressed the challenges with relevant government authorities.

To Nyong’o, the factory that has invested heavily in distillery, paper plant, gas plant and a sugar miller was the biggest investment in the lake region’s economic bloc.

Weekly Citizen has information that Kibos pays crop cess to facilitate harvest running into millions of shillings to lake located counties. The move to relocate is bound to affect revenue collections in following counties under Wycliffe Oparanya (Kakamega), Sospeter Ojamoong (Busia), Cornel Rasanga (Siaya), Paul Chepkwony (Kericho), Stephen Sang (Nandi), Kisumu itself and to an extent, Wilbur Oticillo’s Vihiga county that neighbours Kisumu.

Sang

A High Court in Kisumu stopped operations at the factory. Business rivalry has been linked to the sponsorship of the case as Rai family is accused of being out to lock Kibos in an injunction following a court case as Rai family is fighting Kibos management to lock them out in the privatisation of public sugar factories. In the court case, residents accuse the firm of discharging harmful wastes into the environment.

The case has not been determined after Kibos got another injunction order to allow its operations pending determination of the case. The Kibos School, the Kisumu county government and the factory had agreed on how to resolve the environment crisis but surprisingly, the committee ruled that the factory management, the county government should reach a consensus on how to handle the environmental crisis.

Analysts say that if Kibos departs as it is being lured by Rwanda government due to its envisaged contribution to economic growth to the landlocked Paul Kagame country, it is bound to worsen the current crisis bedevilling the sugar industry in Kenya and more so, the lake region that has seen sugar millers closed down as others fight to remain afloat.

Chepkwony

Miwani Sugar is on its deathbed with Chemelil and Muhoroni, all in Muhoroni subcounty of Kisumu county, in bad shape. In fact at Muhoroni, a cartel led by Richard Ogendo has allegedly been stealing subsidised cane farmers’ fertiliser provided by the government selling it to West Sugar associated with the Rai family at a throwaway price.

Kibos was also in the news when national assembly’s committee on education chaired by Tinderet MP Julius Melly met Education cabinet secretary George Magoha and principal secretaries Belio Kipsang and Kevit Desai.

They were answering questions raised by members on the status of various educational institutions across the country, as well as the funding challenges that special needs schools currently faced.

Ojaamong

On the issue for deliberation on relocation of Kibos special schools due to environmental pollution from Kibos sugar and allied industries, the committee put it to them that their finding is that Kibos did not meet environmental requirements for the factory and therefore, must be moved away to give room for Kibos school for the blind to operate.

Kibos Sugar was allowed to adduce additional evidence over the shutdown of the factory over alleged pollution. The ruling by the Court of Appeal in Kisumu gave the miller a nod to present reports of the National Environment Management Authority and Kisumu county assembly committee of water, environment and natural resources.

Justice Milton Makhandia read the verdict on behalf of a three-judge bench. Kibos Sugar is represented in the court by Tom Ojienda while Fred Ngatia appears for three petitioners Benson Adega, Erick Ochieng’ and Bether Opiyo.

The petitioners lawyer is paid by the Rai family as they cannot possibly be able to afford legal fee for a reputed Ngatia law firm that represented Uhuru Kenyatta during the 2017 disputed presidential elections against ODM leader Raila Odinga at Supreme Court.

Raila’s Spectre International, located in Kisumu has been sued by former staff after it failed to pay Sh150 million in pending dues. The company deals with sugar byproducts.

Court papers filed by lawyer Moses Omondi show that workers were demanding a total of Sh73, 592,868 in salary arrears.

The company did not remit Sacco Sh11,474,727 dues deducted from their salaries and not offering them severance pay and was owed Sh35,669,847 redundancy pay.