Kenya has secured a historic sixth extension on its sugar safeguard from the Common Market for Eastern and Southern Africa (Comesa), offering crucial relief to local millers grappling with persistently high production costs.

The extension was granted during the ongoing Council of Ministers meeting in Lusaka, Zambia, where Kenya’s request for a one-year extension was met with approval for a two-year timeframe.

“The Comesa Council of Ministers granted Kenya an extension of the sugar safeguard measures for two years to enable the government to conclude the process of transforming the sector and enhance competitiveness,” stated the regional bloc.

Kenya’s pursuit of additional extension time is driven by the need to address pending issues within the sector, aiming to enhance competitiveness in anticipation of the impending liberalisation that will remove import limits.

Key among these unresolved matters is the payment method, with Comesa recommending a shift from weight-based to sucrose content-based calculations.

Comesa has outlined a set of measures for Kenya on the path to liberalisation, encompassing cost reduction, diversification of sugar factories into additional revenue streams like ethanol production and cogeneration, adjustment of payment formulas, and augmentation of production capacity.

Originally granted a three-year extension in 2019 to rectify its sugar industry challenges, Kenya faces a narrowing window as it works towards fulfilling the specified conditions.

The country contends that unrestricted imports pose a threat to its sugar sector due to the comparatively expensive local production, with the cost of manufacturing one tonne of sugar in Kenya being approximately $900 (Sh108,729), compared to $400 (Sh48,324) in Mauritius.

Under the current arrangement, Kenya is permitted to import up to 350,000 tonnes of sugar from the Comesa region to address domestic deficits. As part of the strategic measures to rescue the industry, plans are underway to privatize Kenya’s State-run sugar millers.