Sh10b contested oil imports haunt Munya, standards body

Trade and Industry Cabinet Secretary Peter Munya is on the spot for allowing Sh10 billion worth of edible oils to get into the Kenyan market.

This is despite concerns that the products could have expired as well as failed to meet the standards prescribed by the Kenya Bureau of Standards (Kebs).

Local manufacturers are also accusing Munya of double standards and favouring imported goods over locally produced items.

This follows the cabinet secretary’s decision to clear a consignment that had been blocked at the port of Mombasa in May last year by a multi-agency taskforce against illicit trade.

This was over concerns that it had not met standards set by Kebs, including failure by its manufacturers to fortify it with Vitamin A.

The cargo, having stayed more than a year at the port, could also have expired, considering that edible oil products have a shelf life of a year from their date of manufacture.

Last week, Munya defended his move, saying the decision to release the goods had been arrived at by a multi-agency task force. He, however, failed to address concerns over the possible expiry of the products.

“The challenge has been the importers not being able to get contracts for those who process it for them to do it in time,” said Munya during a press briefing last Thursday to address the issue.

The CS said the processing included fortifying the edible oils with various vitamins, especially vitamin A as is required under Kenya’s local standards for marketing edible oils.

“We have upheld with the multi-agency the decision to release the oil and then require those importers to either fortify it or if they have to sell in its current state, then they have to label that it as not fortified,” he said.

Local manufacturers have criticised Munya’s decision and accused the CS of undermining efforts to grow the country’s local industries. Players in the edible oils a sub-sector under the Kenya Association of Manufacturers (KMA) say Kebs requires that all edible oils imported or sold in the country are fortified with vitamin A to prevent micronutrient deficiency.

“The reports have indicated that the released edible oil lacks the required fortification, and we have raised the issue with the storage of the oil at the port for a long time, which may have compromised its quality,” said the lobby in a statement.

“We ask that these allegations be urgently investigated and the required standards upheld in order to safeguard the health and safety of consumers in the country.”

The lobby has written to Munya and Interior CS Dr Fred Matiang’i to clarify the issue. It also wants excise duty on the imported oil paid. “We have written to the Ministry of Industry, Trade and Cooperatives CS Peter Munya, and requested him to reconsider this decision especially in light of the health and safety concerns of all citizens.”

A representative of one of the country’s major edible oil manufacturers said: “We believe the CS (Munya) is being partisan in allowing some players to market their goods without fortification while putting us through rigorous standards to ensure our products are fortified.” 

“We are also concerned about the amount of time the consignment has spent at the port and whether the products are still fit for consumption. Even locally produced edible oils come with a 12 months’ expiry date while these products have been in containers at the port under high temperatures for 15 months,” he added.

The consignment in question has been in the news for the past 15 months and was one of the thorny issues in the run-up to the arrest and arraignment of former Kebs Managing Director Charles Ongwae.

CS Munya is under investigation over the release of the consignment, with the Directorate of Criminal Investigations (DCI) saying it was excluded from the decision.

Illicit trade

Last year, the State formed a task force that roped in the Kenya Ports Authority (KPA), Kenya Revenue Authority (KRA), Kebs, Anti-Counterfeit Authority (ACA) and the Kenya Police to fight illicit trade.

The task force was created in response to complaints by manufacturers and private sector players that Kenya was losing the war against illicit trade.

In the first months of operations, the task force was responsible for confiscating Sh80 billion worth of illicit goods ranging from alcoholic spirits and edible oils, including the Sh10 billion consignment in question.

Mr Munya’s recent decision to release the goods has now raised questions over the Government’s commitment to fighting illicit trade.

Failure to fortify edible oil products coming into the country from Malaysia has resulted in Kebs penalising SGS, which is one of the firms contracted to undertake Pre Verification of Conformity (PVoC) for goods coming to Kenya from the Asian market.

Kebs said the firm had issued certification of conformity for various goods, including the edible oil and was suspended but reinstated after it paid a penalty and upped its inspection standards.

During the more than one year that the edible oil cargo has been at the port, Kebs has had three managing directors in acting capacities and the issue of the cargo may have at some point come to their attention.

After Ongwae, who had overseen the blocking of the cargo, was kicked out, there have been three managing directors in an acting capacity – Moses Ikiara, Bernard Nguyo, and Bernard Njiraini - with the latter having issued the notice to release the products into the market.

Njiraini in a letter, to the owners of the edible oils cargo Maybros Kenya Ltd, told the firm that Mr Munya authorised the release of the cargo.

“Reference is made to the letter…. dated August 1, 2019, from the Ministry of Trade on the approval of a waiver of fortification requirements under (KEAS 769:2014) for impounded edible oil consignment, the CS has granted you waiver,” Njiraini said in the letter.

“The purpose of this letter is to inform you that the seizure and the order for reshipment communicated to you earlier has been lifted and the consignment shall be released to you unconditionally.”