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{
    "id": 520238,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/520238/?format=api",
    "text_counter": 246,
    "type": "speech",
    "speaker_name": "Hon. A. B. Duale",
    "speaker_title": "",
    "speaker": {
        "id": 15,
        "legal_name": "Aden Bare Duale",
        "slug": "aden-duale"
    },
    "content": "need sugar from Sudan, Zimbabwe or Brazil. We will buy our own sugar. Buy Kenya; build Kenya - that is the hallmark of Vision 2030. Hon. Speaker, what are the challenges that the sugar sector is facing that leads to privatisation? The sugar factories are indebted to the Government of Kenya to the tune of Kshs35 billion. Who is going to pay that money? In order for us to improve the standards of our sugar factories, in terms of maintenance and infrastructure, to enable them compete with the international market, we need Kshs40 billion. It is only through privatisation of the sector and teaming up with a strategic partner that Kshs40 billion can be raised. There are always limited resources from the Exchequer. Every Member of Parliament here, and especially those who are in the Budget and Appropriations Committee, knows that resources are very scarce. Everybody is looking upon the Constituencies Development Fund (CDF) for roads and power. The days are gone when the Exchequer could give Kshs40 billion to safeguard our sugar factories. I do not want to go into the many reasons because the Committee has done its work very well. What is the way forward? What is the approved privatisation strategy? The Government will sell 51 per cent of its shareholding in the sugar companies to a strategic partner. The remaining 40 per cent plus shares will remain with the local community, farmers and Members of Parliament who are endowed with resources. Not everybody is as poor as hon. A.B. Duale. There are those of us who can buy shares. There is the formation of the Outgrowers and Employees Investment Trust Fund in the privatisation process, in which farmers and employees could buy shares set aside for them. In this process, farmers and workers of the factories have a certain percentage of the privatisation shares, which they will buy. A total of 24 per cent of the shares will be sold to the outgrowers and staff through the Outgrowers and the Employees Investment Trust Fund. For purposes of security and strategic importance of the sugar sector, the Government of Kenya will retain 25 per cent of the sector’s shareholding. Clearly, 51 per cent will go to a person who will bring the money and equipment required to modernise--- Hon. Speaker, allow me one minute to finish. About 51 per cent will go to a strategic investor, who has the market and a history of sugar-cane farming. Clearly, 24 per cent will go to the farmers, the outgrowers and the workers. Twenty five per cent will be retained by the Government of Kenya. It is as clear as daylight. I am sure that once this House adopts this Report, it will be the beginning of the privatisation journey. Members of Parliament and other leaders, the local community, the outgrowers and the workers will sit together and decide how they will deal with their 24 per cent. I am sure that this House will deal with the strategic partner. Parliament must do a due diligence analysis of the strategic partner. Not anybody will be allowed to buy the companies. He must be somebody who has a history of running sugar factories. We might even sell to a Brazilian company and tell it: “Please, do not import your Brazilian sugar; improve our factories, reduce the cost of production and increase the price for our farmers”. If this goes on well, all factories, whether it is coffee, livestock or sugar must be privatised to delink the Government from doing business. Governments, the world over, are not good at doing business. Why should the Government of Kenya hold 95 per cent of the shareholding of Nzoia Sugar Company, Chemelil Sugar Company and all the others? Thank you, hon. Speaker. The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
}