Kenya exits Comesa safeguard rule as sugar reforms take shape

Kenya has formally exited the Common Market for Eastern and Southern Africa (Comesa) sugar safeguard regime, which the government has used for over two decades to protect the country’s sugar industry.

As the government embarks on critical reforms for the sugar industry, which saw the recent privatisation of State-owned mills, the plan to exit aligns with the ongoing reforms and projects certainty envisioned.

This is according to the Kenya Sugar Board Chief Executive Jude Chesire. 

The government has been using the Comesa lifeline to ensure Kenya is not flooded with cheaper sugar from other Comesa countries, which would have crippled the sector.

Kenya last extended the safeguard regime for two years in November 2023, which then lapsed in November 2025.

Kenya initially sought the sugar safeguard at the launch of the Comesa Free Trade Area in 2001 under Article 61 of the Comesa Treaty, at a time when the industry required structured protection to undertake reforms. Over the past 24 years, Kenya has had eight extensions.

Chesire said 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,” he said in a statement. “The conclusion of the safeguard, therefore, marks the successful completion of a reform cycle, not its abandonment. Chesire said Kenya now enters a new phase defined by competitiveness, value addition, regional integration, and sustainable growth, supported by a clear policy framework and a restructured private-sector-led industry.

“The government remains fully committed 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,” he adds.

Kenya’s confidence to open up the sugar industry to outside competition stems from recent progress recorded in the sector.

The Budget Policy Statement 2026 documents the operationalisation of the Sugar Act, 2024, which introduced the four per cent Sugar Development Levy.

This levy provides funding for factor and infrastructure development as well as support services for farmers and industry administration. Additionally, the leasing of four State-owned sugar mills to private investors (Sony Sugar, Muhoroni, Chemilil, and Nzoia) is expected to improve operational efficiency and safeguard a combined milling capacity of 11,200 tonnes of cane per day.

The National Treasury Budget Policy Statement pointed out that the government’s reforms have yielded significant results in farming, production, and market performance.

One of these results is that the area under sugarcane farming has increased by 19 per cent, from 242,508 hectares in 2022 to 289,631 hectares by December 2024, representing an additional 30,613 hectares (approximately 200,000 acres).

“Sugar production rose by 76 per cent, from 472,773 tonnes to over 815,000 tonnes over a similar period. Consequently, sugar imports declined by 70 per cent, reflecting increased domestic production and greater self-sufficiency,” the statement said. Chesire pointed out that while domestic production has made significant gains, the sector still needs time to fully optimise its operations.

As a result, Kenya will continue responsible importation from both Comesa and other approved sources. “This balanced sourcing framework is deliberate and necessary. Population growth continues to drive demand, while surplus availability within the Comesa region is not always predictable,” he said.

He noted that the industry holds immense potential, as globally, sugar is no longer treated as a single commodity. He said in competitive markets, sugarcane is primarily an industrial raw material, with refined sugar increasingly becoming a secondary product.

“Value is realised through integrated processing of ethanol from molasses, electricity generation from bagasse supplied to national grids, paper and board manufacturing, industrial alcohols, and other downstream products,” said Chesire.

These practices, he noted, significantly lower the effective cost of sugar production and explain why some exporting countries are able to supply sugar at comparatively lower prices.

“Kenya is firmly on this path. The Kenya Sugar Board has been at the forefront of supporting millers to diversify sugar by-products, ensuring stronger balance sheets, stable cash flows, and improved farmer payments. This approach not only strengthens millers but also insulates farmers from volatility associated with over-reliance on table sugar alone,” said KSB boss.

Data from the 2025 Economic Survey report by the Kenya National Bureau of Statistics show the country imported 379,011 tonnes of sugar, molasses, and honey in 2024, which is less compared to 644,003 tonnes in 2023.