By Eddah Waithaka
Concerns are mounting over the increasing interference in the management of smallholder tea factories, particularly by government officials and politicians, which threatens the stability of this vital sector. Recent interventions have included the controversial removal of the reserve price by the Ministry of Agriculture—a decision made without consulting the Kenya Tea Development Agency (KTDA) directors—resulting in a significant drop in tea prices at the Mombasa Tea Auction.
Additionally, proclamations by the Agriculture Permanent Secretary regarding the separation of satellite factories from their parent organizations have raised alarm bells among farmers, who fear that their property interests are being sidelined in these sweeping policy changes. As these issues unfold, the implications for smallholder tea farmers and the industry at large remain serious and far-reaching.
Further complicating the situation at Michimikuru Tea Factory Company, government agencies have been calling impromptu meetings with factory directors, with the costs of these gatherings unjustly shifted to farmers.
This has raised significant concerns about accountability and transparency in an already fragile sector. Recent direct interference in board disputes at the factory, including the purported suspension of directors by the Agriculture Permanent Secretary, has added to the turmoil.
Moreover, these actions appear to undermine the judicial process; government officials have made statements regarding the factory’s directorship that contradict existing court rulings. Notably, on June 29, 2024, the factory shareholders conducted a transparent and democratic election, resulting in the appointment of a duly elected board of directors, highlighting the growing tension between democratic governance within the factory and external pressures from government entities.
However, in the ensuing months, a section of shareholders expressed dissatisfaction with the election outcome, leading to the purported requisition of a special general meeting which resulted in the election of the purported board.
This request came after the Annual General Meeting slated for 6th December, 2024 was disrupted and was unable to proceed. The Registrar of Companies has since granted an extension for 90 days. We urge the Registrar to respect the court order.
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KTDA further promised to remain committed to transparency. “We understand that these developments have caused confusion and concern among the public and stakeholders in the tea industry. We would like to reassure all parties that the resolution of this matter will be guided by the legal and corporate governance frameworks in place. As an organization, we remain committed to transparency, accountability, and adherence to legal procedures. We ask for patience as the matter progresses through the appropriate legal channels. In the meantime, the current board and management will continue to serve the interests of our shareholders, employees, and the public.We will provide updates as the situation unfolds and remain dedicated to resolving this matter in full compliance with the law, ” read the statement.
