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Stricter controls can streamline sugar sector in Kenya

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Monday, 07 September 2015

Stricter controls can streamline sugar sector in Kenya

Sugar is a sensitive product for many African countries and therefore attracts relatively higher tariffs in the East African Community (EAC) and the Common Market for Eastern and Southern Africa (Comesa) trade regimes. In Kenya alone, the sugar sector contributes over 15 % of the agricultural GDP and provides income to about 250,000 small-scale farmers. The total contribution of the sugar sector in the country supports an estimated 10 million people. Since March 2002, Kenya has been imposing safeguards on sugar imports courtesy of Article 61 of the Comesa Treaty that provides for safeguard measures for domestic industries that need international protection until they become mature and stable. The most recent extension given in March 2015 allowed Kenya to maintain a 350,000 tonnes ceiling on duty-free sugar imports from Comesa countries. Beyond the stipulated threshold, tariffs of 35 % on imports of raw sugar and 100 % or $200 per tonne on imports of refined sugar from the rest of the world are imposed. These type of safeguard measures are important for the African Caribbean and Pacific (ACP) countries and the Least Developed Countries (LDCs),  which supply up to 3.5 tonnes through a quota-free and duty free access into the EU market. While the ACP countries currently supply close to 60 % of the EU's import demand for cane sugar, the end of the quotas implies stiffer competition in regional sugar markets.

Source: standardmedia.co.ke