Tata Chemicals, part of the Tata Group, has been asked to exit its long-standing soda ash operations in Kenya after President William Ruto accused the company of failing to deliver sufficient economic benefits to the country.
Speaking during a visit to Kajiado county, where Tata Chemicals Magadi operates, Ruto said the government had identified two new investors to take over the operations.
“I told them the other day to pack up and leave,” Ruto said, alleging that the company had been extracting Kenya’s mineral resources and exporting them instead of processing them locally.
The dispute centres on Tata Chemicals Magadi’s operations at Lake Magadi, around 120 km southwest of Nairobi.
The company extracts trona, a naturally occurring mineral, and processes it into soda ash, or sodium carbonate. Soda ash is widely used in glassmaking, detergents, chemicals, water treatment, textiles and paper.
Kenya is the world’s fourth-largest producer of natural soda ash, accounting for about 1 percent of global production. Ruto argued that Kenya should benefit more by developing industries around its mineral resources rather than primarily exporting the processed commodity.
He also criticised Tata Chemicals for not establishing a manufacturing facility in Kajiado.
Tata Chemicals said it respects the Kenyan government’s decision but remains committed to resolving the issues through legal and regulatory channels.
The company said that since acquiring the Magadi operation in 2005, it has played an important role in the Kenyan economy and that the business remains an integral part of its operations.
Tata Chemicals also said it had submitted a comprehensive response to the concerns raised by Kenya’s mining ministry.
Tata Chemicals Magadi is one of Kenya’s major mineral exporters and one of Africa’s largest soda ash producers.
The company exports more than 3,50,000 tonnes of soda ash annually to markets including India, Southeast Asia, the Middle East and other African countries.
The business employs around 500 people and says its community initiatives around Magadi benefit about 30,000 people through water supply, healthcare, education and infrastructure projects.
The latest directive follows a regulatory dispute that surfaced earlier this year. About five weeks before Ruto’s remarks, Kenya’s mining minister directed Tata Chemicals Magadi to suspend operations, reportedly citing issues including royalty payments and other regulatory requirements.
The Magadi operation has a history stretching back more than a century. Industrial activity at Lake Magadi began in 1911, while a major mining lease was signed with the Kenyan government in 1928.
Tata Chemicals took control of the operation in 2005 after acquiring UK-based Brunner Mond Group.
The latest developments could therefore mark a significant turning point for one of Tata Group’s longest-running overseas industrial operations.