Why Kenya has exited the Comesa sugar safeguard after 24 years

The Government of Kenya has formally exited the Comesa Sugar Safeguard regime after 24 years, marking what authorities describe as a confident and decisive transition for the country’s sugar industry. 

The safeguard, which lapsed on November 30 last year, was introduced as a temporary, reform-driven instrument to stabilise and restructure the sector at the launch of the Comesa Free Trade Area in 2001. 

According to the Kenya Sugar Board, the mechanism has now fully achieved its intended objectives.

“This transition reflects strength, not vulnerability. Kenya’s sugar industry is stable, well-managed and supported by clear policy direction,” Kenya Sugar Board CEO Jude Chesire said. 

He assured farmers, millers, workers and investors that exiting the safeguard does not expose the sector to disruption but instead signals Kenya’s readiness to compete within a structured and fair regional market.

Over the past several years, policy direction in the sugar sector has shifted from protection to competitiveness.

Under the Ministry of Agriculture, the Kenya Sugar Board has prioritised value addition, efficiency and diversification to strengthen the industry. 

Globally, sugar is no longer treated purely as a single commodity. In competitive markets, sugarcane is increasingly viewed as an industrial raw material, with refined sugar becoming a secondary product. 

Value is derived from integrated processing, such as ethanol production from molasses, electricity generation from bagasse supplied to national grids, paper and board manufacturing, industrial alcohols and other downstream products.

Chesire said these processes significantly lower production costs and explain why some exporting countries are able to supply sugar at comparatively lower prices. 

“Kenya is firmly on this path. We have been supporting millers to diversify sugar by-products, ensuring stronger balance sheets, stable cash flows and improved farmer payments,” the CEO said.

He said diversification not only strengthens millers but also shields farmers from volatility associated with over-reliance on table sugar.

The sugar subsector has recorded notable recovery and growth in recent years. 

Chesire said sugarcane acreage has expanded by 19.4 per cent, from 242,508 hectares to 289,631 hectares, supported by favourable rainfall patterns, improved access to certified seed cane and targeted fertiliser subsidy interventions. 

As a result, sugar production increased by 76 per cent, from 472,773 metric tonnes in 2022 to 815,454 metric tonnes currently.

Kenya’s annual sugar demand stands at about 1.1 million metric tonnes. 

While domestic production has made significant gains and is increasingly aligned with national consumption, the government says miller capacity expansion, factory rehabilitation and optimisation of newly leased mills will take time. 

Consequently, Kenya will continue to supplement local production through controlled imports from both Comesa countries and other approved sources. 

“This balanced sourcing framework is deliberate and necessary,” Chesire said, adding that population growth continues to drive demand, while surplus availability within the Comesa region is not always predictable.

The sugar sector has also undergone deep structural reforms, including the transition of former state-owned sugar mills to long-term private leasing.

The CEO said the move was aimed at restoring efficiency, professionalism and accountability, while allowing millers sufficient time to invest, stabilise operations and realise returns under predictable policy and trade arrangements. 

“The exit from the safeguard does not negate government support,” Chesire said.

“On the contrary, it aligns with the reform trajectory already underway and reinforces certainty in the operating environment.” 

Kenya initially sought the Sugar Safeguard under Article 61 of the Comesa Treaty in 2001, when the industry required structured protection to implement reforms. 

Over 24 years and eight extensions, the safeguard was governed by strict benchmarks set by the COMESA Council of Ministers, including tariff-rate quotas, productivity investments, sector restructuring, infrastructure development and continuous performance monitoring.

 “These obligations have now been fully met,” Chesire said, adding that the conclusion of the safeguard marks the successful completion of a reform cycle rather than its abandonment. 

The government reaffirmed its commitment to safeguarding farmer livelihoods, supporting miller viability and ensuring food security, price stability and long-term growth of the sugar sector within the Comesa Free Trade Area.

However, the chairman of the Kenya National Sugarcane Farmers' Federation, Ezra Okoth, called for strict regulations of the sector as the safeguard period ends.

 He warned against opening the floodgates to cheap imports that could lead to a glut in local markets.

 “Farmers want, through regulations, to avoid cheap imports,” Okoth said.

 The farmers also want a formal meeting with the head of state to review their successes and challenges. 

Okoth commended President William Ruto’s reforms in the sugar industry, including subsidised fertiliser and strategic industry reforms, but stressed the need for discussions on proper incentives and collaboration for the common good of all stakeholders.