Bungoma bets big on Pan Paper revival

Tuesday August 23 2016

The stalled Pan Paper mills in Webuye, Bungoma County. Africa’s ability to industrialise is hampered by misguided notions, such as the one that emphasises adding value to its raw materials.  FILE PHOTO | NATION MEDIA GROUP

The PanPaper mills in Webuye, Bungoma County. FILE PHOTO | NATION MEDIA GROUP 

By RAPHAEL WANJALA, [email protected]

Bungoma County is betting on the revival of Pan African Paper Mills to breathe life into the sleepy Webuye Town.

The urban centre was once the lifeline and economic hub of the region but its fortunes took a beating when the factory’s operations ground to a halt.

Bungoma Governor Ken Lusaka said reopening of the paper mill would provide a source of employment and revenue by revitalising the local economy.
“This (pan paper revival) will awaken Western region’s massive economic potential, creating job opportunities,” he said.

Mr Lusaka acknowledged that it would take some time before the firm realises its full potential once it starts operations.
He said the county government is committed to providing the necessary support to ensure the revival succeeds.

“While Pan Paper’s capacity may not match the level it used to enjoy before it collapsed, I strongly believe it will be totally on track in less than five years,” Mr Lusaka said.

“We will do everything possible to ensure the revival succeeds. This will range from infrastructural development, relaxation of any bureaucratic processes such as getting necessary permits or certificates.”

Former employees are also optimistic of resuming work after being in the cold for over eight years.

Mr Wellington Khaemba, a former staff, said the management had already contacted them and provided modalities of how they would resume their respective duties.

He said many employees are hoping to get back to work while others are looking to be paid their benefits that had accrued before the mill collapsed.

Strategic investors

Tarlochan Limited, a subsidiary of Rai Group of Companies and the new strategic investors, took over the company following the signing of a sale and purchase agreement between the company and receiver managers.

Speaking during the handover ceremony in Webuye in May this year, Rai Group of Companies Chairman Jaswant Rai, said they were committed to the revival of the company with focus on paper production.

Mr Rai said they had projected to inject close to Sh6 billion into the company in the next 10 years to rehabilitate and revive old machines.

“The handover process provides an opportunity for us to re-asses the plant and equipment. From our initial assessment, most of the critical machinery will require total replacement and technological upgrades to ensure that we can start operations within this calendar year,” said Mr Rai.

He said he was not after a timber licence as alluded to by a section of leaders. “We are not interested in the timber licence as claimed by certain people. Why should we pay Sh900 million just to acquire a timber licence?” said Mr Rai.

Bungoma residents are optimistic that the revival plan would create jobs and improve living standards.
The miller is expected to employ about 1,500 employees once they start running.

Businesses that depended on the miller are also lining up to have a share since many small scale ventures collapsed with the closure of the plant, especially in the transport, accommodation and hospitality sectors.