Jul 9, 2009
General
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The sharp price increase has been attributed to the country’s failure to import its quota from the Common Market for Eastern and Southern Africa (Comesa), countries although it has indicated plans to source sugar from an unspecified country.
Sugar prices have gone up by more than 35 per cent in the last six months.

A 50 kilogramme bag has shot up to Sh4,500, up from an average of Sh2,900, the Nation established on Thursday.

Sources in the sugar industry said prices were expected to rise further when factories closed down for annual maintenance.

The sharp price increase has been attributed to the country’s failure to import its quota from the Common Market for Eastern and Southern Africa (Comesa), countries although it has indicated plans to source sugar from an unspecified country.

“The failure to import sugar resulted from a standoff between the ministry of Agriculture, the Attorney General’s office and sugar importers,” a source who could not be named because he is not authorised to comment said.

Last year, Attorney General Amos Wako warned that the introduction of new import rules by the government could provoke a major trade war in the Comesa region, Kenya’s largest export market.

Main losers

Mr Wako said the plans to gazette new rules for the industry could invite restrictive measures against Kenyan exports to Comesa, with local producers being the biggest losers.

Due to disagreements over the new rules, over 20,000 tonnes of sugar belonging to several Kenyan companies are being held at Mombasa Port.

It is also estimated that another 20,000 tonnes bought to close the annual deficit are still in the Comesa countries awaiting shipment to Kenya.

These revelations came as the Kenya Sugar Board (KSB) warned that it had stepped up surveillance to ensure that illegal sugar does not enter the country.

KSB Coast regional manager James Sirro said shrewd dealers import a consignment of, say 50 containers, which they declare as rice from Pakistan but up to 10 of them will contain sugar.

Declared as rice

“The consignments come through the port of Sharjah in the United Arab Emirates and are declared as rice in Mombasa. In the past month, about 500 tonnes of sugar has been imported in this manner,” said Mr Sirro, who is also Mombasa sugar imports committee chairman.

He said the committee, comprising officials from KSB, Kenya Ports Authority, Kenya Revenue Authority and Kenya Bureau of Standards is investigating two container freight stations which are alleged to be involved in the racket.
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