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Regional bloc extends Kenya's sugar import safeguards by a year

Xinhua, March 6, 2015 Adjust font size:

The Common Market for Eastern and Southern African (COMESA) has agreed to extend Kenya's sugar imports safeguard from the trading bloc by another year, officials said on Friday.

The Africa's largest bloc's Trade and Customs Committee which was mandated to process safeguards by the Council of Ministers agreed to grant Kenya another 12-month extension during its meeting held last week.

"During its meeting, the committee considered the request from the government of Kenya and recommended that the Kenyan sugar sector should be given a one year extension of their existing safeguard subject to review and renewal for another one year," COMESA said in a statement to Xinhua.

Last week, COMESA Assistant Secretary Kipyego Cheluget said in Nairobi that African bloc's Trade and Customs Committee had agreed to Kenya's request for an extension in order to protect the country from cheap sugar imports.

Cheluget said COMESA will give Kenya more time to improve the efficiency of its local sugar industry. The country's safeguards expired on Feb. 28.

This is the fourth time the East African nation has been granted an extension from the regional bloc since it was granted the protection window in 2004.

The statement said the Committee also recommended that a system allocating specific quotas to each Member State should be put in place taking into account the agricultural calendar of the Member States, in consultation with the Member States and be based on a formula to be agreed by the Council of Ministers.

The statement said the Committee, which is composed of representatives from member States, came up with what was considered "a win-win approach" recommending that the Secretariat should develop the draft criteria for allocating quotas.

"These recommendations will now be tabled before the Council of Ministers on March 26 -27 to take the decision," the statement said, referring to the 18th COMESA summit will be held in Addis Ababa.

The African bloc's safeguards allow Kenya to maintain a 350,000- tonne ceiling on duty-free sugar imports from within the trade bloc, which stretches through to South Africa.

The country's sugar sector is ailing, with millers faced with issues of cane supply shortage due to varieties that take long to mature and are rain-fed, rampant cane poaching and general mismanagement.

Kenya has been seeking another extension of COMESA safeguards on sugar as the current ones expire on Feb. 28, potentially exposing local millers to an influx of cheaper imports.

Kenya is currently producing 70 percent of the total domestic sugar requirement, making the country a net importer of the commodity.

Total sugar requirement in the country is approximately 800,000 metric tonnes, consisting of 650,000 metric tonnes of table sugar and 150,000 metric tonnes for industrial use.

On average, 2,000 metric tonnes of table sugar is consumed daily in the East African nation.

The gap in local production is supplemented through imported sugar mainly from COMESA and the East Africa Community markets and refined sugar from non-COMESA/EAC markets. Endi