New $300 million sugar factory planned in Kenya

A 20 billion Shillings ($300 million) sugar factory is to be built in Kenya's Homa Bay District to ease congestion at Awendo-based Sony Sugar Company. The project would be funded by the European Union and a consortium of developers from Sudan and Switzerland. The factory is expected to bridge the perennial sugar shortages currently bedeviling the country.

Chief Executive Officer of the Kenya Sugar Board, Andrew Otieno, confirmed the project would start before the end of the year.

It will be the second sugar firm in the region, which has a great potential for cane production, after Sony Sugar.

The project consultants, Khartoum-based Kenana Engineering and Technical Services, will produce white sugar, ethanol and electricity from its by-products. It will be constructed in two phases and will take between two and three years to complete. Kenana Services consultants are on the ground finalising feasibility studies with a ground breaking for the sugar milling plant scheduled for November. The firm's officials said the factory will crush 13,200 tones of sugar cane per day. They said the mill will churn out 75 per cent ethanol and 25 per cent white sugar.

The factory will benefit cane farmers from Rangwe, Ndhiwa, Rongo, Nyatike and Gwassi constituencies. Besides offering job opportunities, the firm will also fund the construction of schools, roads and health facilities.

Meanwhile, Rongo MP, Mr Ochillo Ayacko, has urged the government to write-off a Sh1 billion ($15 million) debt Sony Sugar Company owes the government and the Kenya Sugar Board. He said the debts should be converted into equity to help streamline the company's operations.

Ayacko claimed the government has ignored cane farmers. The government, he said, intervened to solve problems affecting coffee and pyrethrum farmers by bailing them out of their financial woes through the Budget, but turned its back on cane farmers.

Out of the Sh1 billion debt, Sony owes government Sh217 million ($3.3 million) and an accrued principal interest of Sh228 million ($3.4 million) that they had failed to service.

The Standard