PM meet for jumpstarting operations of cash strapped Pan African Paper Company

Cabinet to chart the way forward.

Prime Minister Raila Odinga has said the cabinet will meet Thursday next week to rule on modalities needed to jumpstart and restore operations of cash strapped Pan African Paper Company (PANPAPER).

Odinga told a rally in Webuye Saturday after a tour of the paper milling plant that the grand coalition government was determined to initiate recovery strategies to bail out the factory from imminent collapse.

"The cabinet will next week make a decision on what measures to take towards redeeming the operation of the now defunct paper company after it emerged that the closure of the plant was occasioned by poor management" he said.

The premier reassured residents whose livelihood were shuttered after majority of the 2000 workers were sent parking that there was no cause for alarm since the government had taken up the matter.

He expressed optimism that the company would resume operations amid recommendations for an overhaul of the entire management staff whose administrative conduct was found wanting despite government's previous intervention.

Odinga regretted that the paper mill which sustains more than 30,000 lives in Webuye town sunk even after the government twice extended a bailout packages to salvage the company from imminent collapse at the initial stages of the crisis.

He said preliminary audit into circumstances under which the 40 year old company stalled revealed that some managers embezzled revenue generated without regard to the general welfare and survival of the ailing factory.

The premier also visited Nzoia Sugar Company to assess ways of expanding and installing modern technology at the facility amid reports that the sugarcane intake capacity of the plant was below the farmer's production potentials.

He announced that the government was working on a ways of installing the state of the art equipments in all sugar factories to diversify their industrial production to ensure that the cane intake was in tandem with the farmer's output.

"We want to introduce the latest technology in the country's sugar industry so that the factories can not only produce sugar but have several lines of production including Ethanol, electricity and fertilizers which will boost income base" Odinga said.

He told a separate rally at Bukembe market that the government policy to freeze import of sugar still stood to protect the interest of peasant cane farmers and local companies from undue competition.

"The coalition government wants to promote sugar farming in the Mumias ,Nzoia, Muhoroni Chemelil, SONY and all sugar belt so that farmers can reap the fruit of their labour and discourage delay in collection of mature sugar" he said.

He said the coalition administration was disturbed by the delay or failure in picking of harvested cane a trend the farmers said had further impoverished their livelihood.

The premier's working tour to financially challenged institutions in Western province comes after Pan Paper closed doors and laid off at least 2,000 workers last months after the giant paper miller failed to foot more than Ksh 100 million in electricity bills which led to disconnection of power to the plant.

Several cabinet Ministers who accompanied the premier including his deputy and local Government Minister Musalia Mudavadi recommended for immediate cancelation of technical management agreement.

source: kbc