, NAIROBI, Kenya, Feb 12 – Kenya’s earnings from fresh produce exports in 2018 jumped to Sh153.68 billion, a 33 per cent increase over 2017 earnings.
This is according to the statistics released by the Kenya Flower Council (KFC), Fresh Produce Exporters Association of Kenya (FPEAK), and Fresh Produce Consortium of Kenya.
Flower exports contributed Sh113.16 billion up from Sh82.24 billion earned in 2017, representing 37.8 per cent growth while Fruits and vegetables earned Sh12.83 billion and Sh27.68 billion in 2018, up from Sh9.0 billion and Sh24.06 billion earned in 2017, respectively.
The cut-flower export still remains the largest earner, contributing 74 per cent of the total fresh produce annual earnings, fruits at 8 percent and vegetables at 18 percent.
Hosea Machuki, Chief Executive Officer of Fresh Produce Exporters Association of Kenya, said the sector has remained resilient amid various challenges, as the industry was hit hard by an acute shortage of soluble fertilizer and the imposition of 16 percent VAT on pest control products.
The shortage of fertilizer was caused by stringent and lengthy clearance process by the Kenya Bureau of Standard at the port of entry.
“The sector has seen marked resilience and continued growth and huge potential which has enabled it weather various challenges such as the Brexit shock and fertilizer shortages which the sector faced,” said Machuki.
The imposition of 16 percent VAT on pest control products and VAT return estimated to be Sh3.5bn, has increased the cost of production, resulting in non-competitiveness in the international markets.
“These challenges have compounded the many challenges Kenyan farmers face including numerous taxes, and levies at national and county governments, high energy costs, trade and phytosanitary restrictions in several potential markets, and the recent notice on closure of runway during the valentine peak season,” said Clement Tulezi, Chief Executive Office, Kenya Flower Council.
Principal Secretary, Ministry of Trade Chris Kiptoo said the government was working toward expanding the export market for the horticultural products besides the primary European markets.
“The government is exploring new markets like China to complement the traditional European market. Already a delegation from China will be in the country soon to evaluate the avocado market and we are optimistic soon our farmers will start export to the Chinese market. US market is also key for us, following the commissioning of the direct flight between Kenya and the United States,” Kiptoo said.
Kiptoo also noted that the government was in discussion with the United Kingdom on the issue of Brexit to ensure that the sector is not adversely affected, irrespective of the outcome of the process.