The High Court has turned away a fresh effort to suspend the leasing of five government-owned sugar factories to private operators, declining to grant conservatory orders that would have stalled the programme.
The court found that the relief sought would effectively amount to a final determination of the dispute and could not be issued at an interim stage. The case sought to halt the State’s transition from a 2015 privatisation blueprint to a 2023-24 leasing model.
The petition was lodged by Johannes Odhiambo Swa Makaduol, who named William Ruto, Agriculture Cabinet Secretary Mutahi Kagwe, the National Assembly, Attorney General Dorcas Oduor, the Privatisation Authority and the Agriculture and Food Authority as respondents. He contended that the new leasing framework had been hurriedly developed and implemented without the required public participation, particularly affecting sugar companies in Nyanza and western Kenya.
Last year, the State leased the struggling mills under 30-year agreements designed to inject capital and revive operations after prolonged losses, debt burdens and mounting arrears. Nzoia Sugar Company was leased to West Kenya Sugar Company Ltd, Chemelil Sugar Company to Kibos Sugar & Allied Industries Ltd, Sony Sugar Company to Busia Sugar Industry Ltd and Muhoroni Sugar Company to West Valley Sugar Company Ltd.
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Under the contracts, investors are to pay annual land rent of about Sh40,000 per hectare for Chemelil, Muhoroni and Sony, and Sh45,000 per hectare for Nzoia. They will also remit concession fees of Sh4,000 per tonne of sugar and Sh3,000 per tonne of molasses, alongside a goodwill payment in the first year. The lessees have pledged more than Sh12.2 billion towards rehabilitation, modernisation and cane development to restore production and safeguard farmers’ incomes.
The government maintains that the leasing arrangement preserves public ownership while drawing in private capital and operational expertise, repositioning the State as regulator rather than operator in a sector long plagued by inefficiency.
