Kenya has officially exited the Common Market for Eastern and Southern Africa (COMESA) sugar safeguard list following increased domestic production, President William Ruto has announced, marking a major shift in the country's efforts to revive its sugar industry and reduce reliance on regional trade protections.
Speaking during the Industrialisation Summit at the Kenyatta International Convention Centre (KICC) in Nairobi on Wednesday, Ruto said local sugar production had increased sufficiently to allow the country to operate without the special safeguards that had protected domestic millers from competition within the regional trading bloc for approximately 24 years.
“Now, I can announce formally that Kenya is off the COMESA safeguard list on sugar. Why? Because we are producing enough sugar in Kenya. We don't need any safeguards, and our production is not only from private sector factories, but also from government-owned mills,” he said.
The COMESA sugar safeguard is a special trade protection arrangement that Kenya has relied on for more than two decades to shield its domestic sugar industry from competition posed by cheaper sugar imports, particularly from other member states.
The protection measures were introduced in 2002 after Kenya raised concerns that unrestricted sugar imports from COMESA countries could undermine local producers, whose production costs were relatively high and whose factories faced operational and financial challenges.
Under the arrangement, Kenya was allowed to restrict sugar imports from other COMESA member states through quotas and other trade controls, despite the regional bloc's commitment to promoting free trade among its members.
The safeguards were intended to give local sugar factories time to modernise their operations, improve productivity and become competitive enough to withstand regional competition.
However, the protection measures were repeatedly extended as the industry struggled with mounting debts, ageing factory equipment, inconsistent sugarcane supply, high production costs and governance challenges in state-owned mills.
Kenya's exit therefore signals a transition from a protected market towards greater exposure to regional competition, placing increased pressure on local manufacturers to sustain production and improve efficiency.
Ruto attributed the development to government interventions aimed at addressing longstanding financial and operational challenges in the sugar sector, including the writing off of nearly Sh117 billion in accumulated debts owed by state-owned sugar factories.
He said the debt had accumulated over almost three decades, leaving the factories financially constrained and limiting their capacity to invest in production and meet their obligations.
“We had a huge debt of close to Sh117 billion on our sugar factories. That debt had been rolling for the last almost 30 years. We decided as government that it was the best thing to lift that burden from our sugar sector. So we went through the processes, and we wrote off that debt. We freed the sugar factories from this debt,” Ruto said.
The President maintained that the government had also transferred the management of state-owned sugar mills to private operators as part of efforts to improve efficiency, strengthen accountability and restore commercial viability.
He said the changes had improved payments to sugarcane farmers and workers, who had previously experienced prolonged delays due to the financial difficulties facing the factories.
According to Ruto, farmers were now receiving payments on time, while workers were also being paid without the delays that had affected the sector.
The President further announced that four sugar factories would pay bonuses to sugarcane farmers for the first time this month, describing the development as evidence of improved financial performance in the industry.
“Farmers are now paid on time, workers are paid on time, and this month, for the first time in four factories, we are going to pay bonuses to sugarcane farmers for the first time,” he said.
The government has also licensed five additional sugar factories, two of which have already commenced operations.
Ruto said the five factories were cumulatively employing 20,000 young people, adding that the expansion would increase production capacity while creating employment opportunities.
He maintained that the combination of debt relief, private-sector management and additional investments had helped restore confidence in the industry and strengthened Kenya's ability to compete without regional trade protections.
“So again, in that space, just by reorganising it and providing better policy direction, we now can safely walk out of what we are calling COMESA sugar safeguards that have been with us for the last 24 years,” he said.
The exit comes at a time when the government is pursuing broader industrial and agricultural reforms aimed at increasing domestic production, strengthening local manufacturing and retaining more value from agricultural products within the country.
Ruto said the administration was committed to expanding local processing, improving farmers' earnings and creating employment by ensuring that more goods consumed in Kenya were produced locally.
However, the removal of the safeguards also presents a test for the domestic sugar industry, as local millers will face increased competition from regional producers once the special import restrictions are lifted.
The sustainability of the reforms will depend on whether factories can maintain production, farmers can consistently supply sugarcane and local producers can compete on price, quality and efficiency.
Kenya's departure from the COMESA safeguard arrangement therefore marks the end of a prolonged period of special protection for the sugar sector, shifting the focus towards productivity, investment and competitiveness in the regional market.