Madaraka Day: State writes off debts worth Ksh117B for sugar and coffee sector

The government has written off Ksh 110 billion debt accrued by sugar mills over the last 40 years and Ksh 6.9 billion debt incurred by coffee cooperatives.

In his speech while presiding over the 61st Madaraka Day celebrations in Bungoma, President William Ruto outlined a comprehensive plan to revitalize the sugarcane and coffee sectors.

The President revealed that the government has introduced a new leasing model to ensure timely payments for sugarcane deliveries, timely wages to factory workers and annual bonuses to sugarcane farmers.

“The sugar industry is a highly strategic sub-sector that is the mainstay of the local economy in our sugar belt. We want this to bring maximum value to all players, starting with the sugarcane farmer,” Ruto said.

He urged relevant agencies to expedite the review process and take into account revenues from by-products.

The Head of State further announced the approval of the first tranche of Ksh600 million for seedcane development as part of a larger Ksh2 billion investment.

Ruto also outlined measures to increase coffee production from the current 2kg to 10kg per tree, as well as increase annual production from 50,000 tonnes to 102,000 tonnes by 2027.

“As part of the coffee sector reforms we initiated, a Ksh 4 billion coffee fund was established, of which Ksh 2 billion was disbursed and the remainder was earmarked for disbursement in the 2024/2025 financial year. Thanks to this, farmers will get a good return on their investment,” he said.

The President emphasized the direct contribution of agriculture to the economy, emphasizing the need for continuous modernization of this sector as one of the key pillars of government development.

“Agriculture’s direct contribution to our GDP is 25%, while indirect support to other pillars of the economy, such as manufacturing, increases GDP by a further 27%. It is estimated that about 40% of our population works in agriculture directly or otherwise,” Ruto said.

This year’s Madaraka Day celebration was held under the theme “Agriculture and Food Security”.