Ruto now turns guns on Uhuru, Raila business empires
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Ruto now turns guns on Uhuru, Raila business empires in a move to break their dominance in the dairy sector and LPG
Ruto now turns guns on Uhuru, Raila business empires in a move to break their dominance in the dairy sector and LPG.
These actions indicate attempts to end the dominance of President William Ruto’s predecessor Uhuru Kenyatta and opposition leader Raila Odinga’s multibillion-shilling business empires in the dairy industry and the liquefied petroleum gas (LPG) cylinder companies.
The latest in a chain of policy shifts and public pronouncements targeted a ban on the importation of powdered milk that they have linked to Uhuru Kenyatta’s Brookside Dairy business, which controls about 40 percent of the market share for processed milk.
The new administration is also attempting to expand the market for LPG players and launch government action to lower gas cylinder prices, both of which would have a substantial impact on the dominance of East Africa Spectre Limited, a company connected to Mr. Odinga’s family.
According to information on Spectre’s website, with an installed capacity of around two million units yearly, it is the “leading and largest cylinder maker” in the Eastern and Central African region.
According to other available data, East Africa Spectre Limited has an 80 percent market share in LPG cylinder revalidation and supplies 20 percent of the country’s gas cylinders.
President Ruto has already announced plans to reduce the cost of a 6kg gas cylinder to about Sh500 by June, largely through government subsidies.
Energy Cabinet Secretary Davis Chirchir last week also revealed plans to allow more suppliers in the market so as to reduce prices.
“LPG has been brought into this country by one supplier. There is a lot of effort to bring serious competition so that we can bring down the prices,” said Mr. Chirchir.
Without mentioning names, Deputy President Rigathi Gachagua while in Eldoret on Friday claimed that the challenges facing the milk sector were because of a monopoly by one family, which he accused of buying out all milk companies in the country.
He claimed, without providing evidence, that the same individual was involved in the importation of powdered milk.
Gachagua said they have since banned the importation of powdered milk so that local dairy farmers can access the market for their milk.
“We have stopped the importation of powdered milk to allow our dairy farmers to enjoy the market. It is our responsibility to protect our farmers in the coffee, tea, and dairy sub-sectors. Challenges in the milk sector have been caused by the monopoly we have. One person bought all milk companies in the country and was also involved in the importation of powdered milk from foreign countries,” said Mr. Gachagua.
The Kenyatta family’s signature milk processor Brookside Dairies Ltd, set up in 1993, has since become the market leader in milk processing and allied products in Kenya and the region.
Brookside has also expanded operations to some of the neighbouring countries.
The data further show that Brookside commands a 45 percent share in milk-related products such as butter, cheese, ice cream, yogurt, and condensed and dried milk.
Already, Azimio La Umoja One Kenya politicians have termed the move as an attempt by Ruto to use economic sabotage as a tool to force Mr. Odinga to back off from his planned mass action.
The leaders said the economic sabotage will not succeed, citing similar attempts deployed by the late President Daniel Moi in dealing with the late Jaramogi Oginga Odinga.
They also claimed some of the top leaders in the Kenya Kwanza Administration had interests in the same sectors and were trying to use their position in government to frustrate their would-be competitors in the market.
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“Moi tried to bring the same business (East Africa Spectre Ltd) down but it did not work. Let them not use economic sabotage because it would definitely fail. It will also affect the economy because even foreign investors will be scared in a country where economic sabotage is used as a tool to settle political scores,” said ODM National Chairman John Mbadi.
Vihiga Senator Godfrey Osotsi claimed that a senior government official has an interest in the LPG business and was pulling strings to frustrate current dealers.
“These fellows are busy trying to acquire as much wealth as they can and have resorted to fighting individuals they perceive as roadblocks to their journey to more wealth. We are aware that they have some personal interests in the gas business,” said Mr. Ososti, who did not back up his claims.
Democratic Action Party of Kenya Secretary-General Eseli Simiyu made similar claims, alleging that the scheme to kick out current dealers in the two sectors is to create space for individuals in government.
“It is pure political war with people they perceive as their political enemies and are out to interfere with their businesses. They should just concentrate on improving the economy instead of being vindictive because fighting Uhuru and Raila will not improve the economy,” said Dr. Eseli.
“The whole thing is part of them trying to marshal their way into the same businesses. Their mindset is that anybody running a big business is a dynasty and has to be fought,” he said.
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