Flowery meeting in Naivasha

September 11, 2008
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, NAIROBI, Sept 11 – Stakeholders in the flower industry are due to converge in Naivasha on Friday for an annual general meeting that was set to raise fundamental issues affecting the future of the horticultural sector which is billed as one of Kenya’s top foreign exchange earner.

Kenya Flower Council Chief Executive Officer, Jane Ngige, said the meeting would discuss the outstanding issue of a horticulture policy and was likely to come up with concrete proposals for the government.

The lack of a policy, she said, had hurt the industry in the past noting that different ministries have instituted different tax measures leading to over taxation in an industry that must remain competitive to survive in the lucrative export business.

“The Ministry of Trade classifies the industry both as manufacturers and farmers. As manufacturers, they have to pay manufacturer’s standards levy, an equivalent of 0.2 percent of annual turnover. On the other hand as farmers, they miss out on EPZ status and the tax breaks that come with it,” Ngige said.

The Ministry of Local government for its part levies horticulture cess besides requiring farmers to pay a levy for erecting greenhouses. The contention has been whether greenhouses should be considered permanent structures or not.

Ngige said: “A comprehensive horticulture policy would address the anomalies and put the industry under a singular statutory authority.”

There is also concern in the industry about who in the government should be responsible for marketing Kenya’s flowers abroad as well as lobbying against unfavourable policies in the export market. Until recently, the council worked alone in marketing Kenya’s flowers abroad.

Although Embassies in key markets have been supportive, Ngige called for a structured and a sustained intervention guided by policy in order to identify necessary resources.

“This year, however, the government through the Ministry of Agriculture is financing the Kenyan stand at the Holland Hortifair scheduled for October,” said Ngige.

The industry is also worried about a new bill currently before the European Parliament that would see aviation included in the continental emissions trading scheme (ETS). If it becomes law, it could affect Kenya’s access to the European market by making its flowers uncompetitive compared to flowers grown within Europe.

Also likely to feature strongly at the AGM are the new labour laws that entitle new mothers to a three-month paid maternity leave and fathers two weeks paternity leave in addition to their annual leave.  

“We are already complying with the new laws as provided for in the Kenya Flower Council Code of Practice, as we await the policy guidelines on implementation, and as we work together with FKE on the issue,” said Ngige.

The flower industry is labour-intensive with a workforce of between 50,000 and 70,000 people.

The industry grew from 80,000 tonnes in 2006 to 104,000 tonnes worth of exports last year earning the country Sh28 billion and Sh32 billion respectively.

This is the first Kenya Flower Council AGM to be held under the chairmanship of Kabuyah Muito who took over the reins late last year following the resignation of Erastus Mureithi who joined politics.

The AGM is taking place alongside the annual Naivasha Hortifair, which gives stakeholders in the industry an opportunity to share developments and trends in the market.

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