Kenya has decided to go it alone in setting up a fertiliser production plant in the face of a frustratingly slow approval process in East African Community partner states Uganda and Tanzania that had been approached to participate in a joint venture.
The government plans a feasibility study on the plants viability in the next two months at a cost Sh70 million. The study is expected to be completed by June.
Experts have warned that such a project would be very expensive for the country to undertake on its own.
Agriculture permanent secretary Dr Romano Kiome confirmed the feasibility study would go ahead, adding the government has held discussions with Uganda and Tanzania and development partners.
Reliable sources who spoke to the Sunday Nation on condition of anonymity because of the sensitive nature of the matter, also said the government has been consulting international fertiliser producers and financiers about the possibility of setting up such a plant.
The feasibility study will determine the way forward. We decided to initiate the project as a government after the other countries in the region were slow in responding to our initiative. The others can join later, said a source in government not authorised to speak to the media.
The idea to building the factory is not new. When reading the 2008 Budget then Finance minister Amos Kimunya said Kenya was consulting with Uganda and Tanzania on the funding and location of a regional fertiliser production plant.
We are in consultation with Uganda and Tanzania on setting up a regional fertiliser factory to ensure long term sustainable (fertiliser) supplies, Mr Kimunya said.
If the project takes off, it would be the third time Kenya has tried to set up such a factory. The most controversial attempt was a 1975 initiative in which the government entered into a joint venture with N-Ren, an American firm, to set up KenRen Chemical and Fertilisers Ltd.
KenRen was to manufacture fertiliser for domestic and export markets.
It signed financing agreements with Austrian and Belgian banks and suppliers, with the Kenya government as guarantor.
The suppliers were Coppee Lavalin of Belgium and Voest Alpine of Austria. They never delivered any equipment except for some crates whose contents were not verified.
Three years later, the project collapsed, and KenRen went under. The government, as a guarantor, became responsible for the debts which have been the subject of investigations and heated debates in Parliament.
read more: Daily Nation: - Business News |Kenya opts to go it alone in setting up fertiliser factory
The government plans a feasibility study on the plants viability in the next two months at a cost Sh70 million. The study is expected to be completed by June.
Experts have warned that such a project would be very expensive for the country to undertake on its own.
Agriculture permanent secretary Dr Romano Kiome confirmed the feasibility study would go ahead, adding the government has held discussions with Uganda and Tanzania and development partners.
Reliable sources who spoke to the Sunday Nation on condition of anonymity because of the sensitive nature of the matter, also said the government has been consulting international fertiliser producers and financiers about the possibility of setting up such a plant.
The feasibility study will determine the way forward. We decided to initiate the project as a government after the other countries in the region were slow in responding to our initiative. The others can join later, said a source in government not authorised to speak to the media.
The idea to building the factory is not new. When reading the 2008 Budget then Finance minister Amos Kimunya said Kenya was consulting with Uganda and Tanzania on the funding and location of a regional fertiliser production plant.
We are in consultation with Uganda and Tanzania on setting up a regional fertiliser factory to ensure long term sustainable (fertiliser) supplies, Mr Kimunya said.
If the project takes off, it would be the third time Kenya has tried to set up such a factory. The most controversial attempt was a 1975 initiative in which the government entered into a joint venture with N-Ren, an American firm, to set up KenRen Chemical and Fertilisers Ltd.
KenRen was to manufacture fertiliser for domestic and export markets.
It signed financing agreements with Austrian and Belgian banks and suppliers, with the Kenya government as guarantor.
The suppliers were Coppee Lavalin of Belgium and Voest Alpine of Austria. They never delivered any equipment except for some crates whose contents were not verified.
Three years later, the project collapsed, and KenRen went under. The government, as a guarantor, became responsible for the debts which have been the subject of investigations and heated debates in Parliament.
read more: Daily Nation: - Business News |Kenya opts to go it alone in setting up fertiliser factory