Download Horticulture: US$ 630 million

Kenyan Horticulture,
50 years, in retrospect…
Presentation by
Hasit Shah (Tiku)
Managing Director: Sunripe Kenya; Terra Fleur; Koppert Biological
Systems Kenya; Serengeti Fresh Tanzania
Chairman: Fresh Produce Exporters Association of Kenya
Director : Horticultural Crop Development Authority Kenya
Director : COLEACP
Chairman : Horticultural Board, Export Promotion Council, Kenya
Feb 2007
World Bank Global Forum on Building Science, Technology &
Innovation Capacity
Kenya : An Overview
Land area: 580,000 sq. km
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Location:
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Population:Approx. 33 million
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East coast of Africa.
(2005)
Diverse mix of ethnic backgrounds
Includes 42 native tribes, people of European,
Asian and Arab origin.
GDP : US$ 17 Billion
Horticulture
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Main export products & values (2006)
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Tourism:
US$ 800 million
Horticulture: US$ 630 million
Tea:
US$ 500 million
Coffee:
US$ 120 million
Horticulture directly provides employment to 100,000
people, primarily women, employs university
graduates and indirectly supports close to 1 million
individuals & dependants.
In a nutshell
Kenya has an amazing climate & a range of ecological zones that allows year round
production of a number of agricultural crops. The first settlers planted Coffee, Tea,
Sisal, Sugar Cane, Cotton, Rice, Wheat & Maize and this led to the establishment of
large estates and strong agriculture learning institutions. Del Monte then set up their
Pineapple plantation for processed pineapple in the mid 1950’s
1963 : Post Independence Migration to the UK led to establishment of two way trade &
entrepreneurs identified opportunities to supply indigenous vegetables to migrants
1970’s-80’s : Significant growth due to favourable domestic policies for exports & a growing
demand for fresh produce
1990’s & the new millenium : Rationalization in the industry due to international
competition, higher costs of production & the drive for food safety, quality
& emerging standards leads to a consolidation of the industry & a focus on
value addition to produce top-end high products
One in every three roses sold in the European Union is Kenyan
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70’s : Bulk product
2006 Top end, value addition
The growth in the last 4 years
Figure 1: Trends in Horticultural Exports
700,000
600,000
500,000
400,000
300,000
200,000
100,000
Oct 01- Sep 02
Oct 02 - Sep 03
Oct 03 - Sep 04
TONS
Oct 04-Sep 05
000' USD
Oct 05-Sep 06
Reasons for Success:
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Global Trends
Globalization
 As links (physical & trade agreements) between countries
develop new markets open up
A move from first world countries to developing countries of
labour intensive industries & un-processed agricultural
production
Bilaterals & Preferential access treaties (Lome & Cotonu)
Quality Standards & Certifications
Reasons for Success:
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Political Stability
Land ownership & tenure
Reasonably good infrastructure:
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Government
Airport, ports and cargo handling facilities, banking
Energy, roads, telecommunications
Fair water resources management policy
Market oriented economy & export policies – the sector's gradual development
has been aided by
sound economic management,
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realistic exchange rate & no exchange control,
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stable policies with incentives & remissions on inputs for export
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a good investment climate
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Access to finance
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multiracial non secular society that encourages foreign investors
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The development of other sectors [tourism & manufacturing]
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Constant dialogue between the Government. The Private Sector & Development
Partners
-all important for both foreign & local investors, producer & exporters
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Hands off / Non intervention policy in Horticulture production & marketing
(unlike coffee, tea, pyrethrum etc)
Reasons for Success:
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…contd.
Establishment of competent authorities that provide,
in conjunction with the industry,
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Government
Farmer training & extension services
Market linkages for small holders to high value urban and
export markets
Comprehensive labour laws
Improved health services & institutions
A strong & respected SPS institution
Investment in primary, secondary & tertiary
education
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Set-up of agriculture & technology oriented local universities that has led to
an excellent resource pool of competent graduates
Reasons for Success:
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Private Sector
A dynamic private sector identified production & supply
opportunities for fresh grown fruit & vegetables
As factors continued to change & as demand evolved the sector
was quick to respond to changing consumer preferences & to
international competition. This was achieved by
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The ability to produce & supply existing & new markets year round
Heavy investment into
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new technologies in greenhouses,
growing media
irrigation systems,
R& D into new varieties, crops, plant material & seed,
Sophisticated agro-inputs,
Improved long life (modified atmosphere) packaging,
Sophisticated machinery for bouquets making & food processing
Putting in place a robust cold chain which is crucial for fresh perishable
products
Research into alternative transport and reefers by sea
Reasons for Success:
Private Sector
• The world is our market & open interaction & dialogue between producers &
the market is on-going. There is also significant investment in skilled foreign
labour to train Kenyans in new products & technologies. This combined with
focused training from some of our local institutions (JKUCAT) continues to build
local capacity. Kenyan managers now run farms in Tanzania, Uganda, Rwanda,
Ethiopia, Morocco & Egypt!
•Created Strong lobbies: Fresh Produce Exporters Association; Kenya
Flower Council to work closely with government & development partners to
ensure that a conducive environment exists for continued development of the
sector. Both associations have come up with self regulating industry Codes of
Practice that meet & supersede local & international legislation. The advantage
is that these are reviewed annually as opposed to legislation that never moves.
Product from Kenya is compliant to EU /US Food Safety legislation, meets labour
& environment standards & most important is sustainable.
•Included contract & small scale farmers in supply programs
Reasons for Success:
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Support Industries
A pro-active supply and manufacturing sector that reacted
quickly to exporters needs to provide quality inputs
Kenya is big in tourism and the entry point for east & central
Africa – This provided cargo capacity & links to all international
markets
An established banking & insurance sector is essential for credit,
trade and financial instruments
The future : What Governments and
Development Partners should focus on?
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Continued investment in infrastructure & reliable supply of power &
utilities
Build capacity within governments to ensure that competent support
institutions & negotiating bodies are in place to continue developing
market access & bi-lateral trade agreements with other nations
Encourage external investors and partners
Work on programs that allow affordable credit to business
Allow freer & less restricted movement of people
Continue to facilitate rather than regulate sectors
Increase investment & funding of R & D activities both at the
universities & research institutions
Encourage transfer of new & appropriate technologies that would boost
efficiency and cost effectiveness in production
Encourage exchange programs between private sectors, government
and producers with counter parts in other countries
The End
Thank you