Kenya just handed over four of its biggest sugar factories — but kept the land. In a dramatic policy shift, the Ruto administration signed 30-year leases in May 2025 with private firms to run Nzoia, Chemelil, Muhoroni, and Sony Sugar. The goal? End decades of sugar sector chaos: collapsed factories, billions in unpaid debts, unpaid workers, and cheap imports undercutting farmers. Agriculture CS Mutahi Kagwe says this isn’t privatization — it’s “strategic leasing,” with public ownership preserved and billions in arrears cleared to give the new operators a clean start. Big names like Jaswant Rai’s West Kenya Sugar and Kibos Sugar are now in charge — and they’re expected to invest heavily. But not everyone’s cheering.

Local leaders are furious. Kisumu’s Governor Anyang’ Nyong’o is calling foul, slamming the deals as opaque, exclusionary, and a threat to community-owned land. At Chemelil and Nzoia, workers are protesting over unpaid wages, job security, and fears that private operators will trample their rights. Farmers worry about price manipulation and monopolies. And watchdogs are questioning the wisdom of the government wiping out billions in past debts — on taxpayers’ backs — without clear guarantees of public return. The Auditor General has already flagged risks to the Commodities Fund. If this feels familiar, it’s because Kenya’s SOE reform playbook hasn’t changed much in decades: bold plans, shaky execution, and the ever-present risk of insider deals dressed up as national progress.

Still — if the government gets this right — it could turn a rotting industry into a competitive, tech-upgraded, farmer-friendly economic engine. But it won’t happen without airtight oversight, crystal-clear contracts, local accountability, and a serious break from past mistakes. Leasing might be smarter than selling — but only if it comes with more transparency than politics usually allows.

References:

The Standard Nyong’o opposes the government’s plans to lease sugar mills

The Eastleigh Voice Government leases four state-owned sugar mills to private firms for 30 years

Business Daily Workers oppose Chemelil sugar factory lease plans

The Star Sugarcane farmers welcome move to lease sugar firms

All Africa Kenya: High Court Dismisses Petition Against Leasing of State-Owned Sugar Farms