Fourth South-South Cooperation Workshop on Rural Development and Poverty Reduction - Muia Muindi
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Transcript of Fourth South-South Cooperation Workshop on Rural Development and Poverty Reduction - Muia Muindi
PAPER PRESENTED AT THE 4TH WORKSHOP ON S-S COOPERATION BETWEEN CHINA AND IFAD AT BEINJING 5TH-12TH JULY 2012
BY:MUIA MUINDI MOA
MINISTRY OF AGRICULTURE PRESENTATION ON:
MARKET ACCESS BY SMALL SCALE FARMERS IN KENYA
BACKGROUND OF AGRICULTURE SECTOR IN KENYA
Kenya’s economic growth built on Vision 2030 policy blue printAims at transforming the country into an industrialized middle
income country providing high quality of life to its citizens by 2030As we achieve the vision, we will meet broader development
inspirations including Millennium Development Goals. MDG 1Agriculture identified as a key contributor to the economic pillarAgriculture targets to maintain a sustained growth rate of 10% per
annum from 2012 for 25 years.Agriculture contributes directly 23% to the country’s GDP and 27%
indirectly through other service sectors e.g. manufacturing, trade60% of country’s total export revenue is from agriculture,75% of rural workforce is in agriculture.Hence critical tool for employment creation and poverty reduction.
Our staple food is maize.Our country is 80% arid and semi aridIrrigation potential is only 20 % exploitedThere is over dependence on rain fed
agriculture. Agriculture sector development is done through Public-Private partnerships involving multiple stakeholders in the public and private sectors.
Characteristics of the smallholdersThey comprise about 80 % of our farmerContinuous land fragmentation boosts SSFLow levels of production. due low level use of
appropriate technologies e.g. fertilizers, seeds.
Low returns to investment due to low levels of operation. Seasonal Production
Most agriculture products sold in raw form with minimal value addition .
Marginal beneficiaries in value chains
Challenges of SSFInadequate access to credit ,ie difficult to
meet financier requirementsInadequate access to markets Highly fluctuating and generally low prices
esp where farmers are not organised to groups .
Inadequate access to services (eg. Extension, financial, research, market information etc)
Inadequate access to appropriate technology
Collective actionIn order to address above agriculture
characteristics and challenges, the ministry of agriculture promotes enterprise development through enterprise Interest Groups (CIGs). The ultimate aim is to have these producer organizations transformed into cooperatives.
Most groups are enterprise based.
Benefits of Farmer enterprise interest groups cont..Access to profitable markets . Gk policies recognizes the role of coops
/group in marketingBulk their produce in a collection centre and hence
make it easier for the traders to pick thus reducing transaction cost
Bargain for a fairer priceEnhance product quality by implementing quality
control systemsParticipate in Fair Trade and other pro-producer
programs with the attendant benefitsSign contracts with buyers and hence reduce the
price uncertaintyTransport their produce to more profitable markets
and thus get a better price
Benefits of Farmer associations cont..Access to credit and other financial
servicesGroup guarantee Through Savings and Credit Cooperatives
(SACCOs),members can access credit even for agric production .
Some GK related loans have been channeled through coops e.g. coffee dev fund and stabex fund.
Benefits of farmer groups cont..Increased access to extension and other
servicesSome farmer associations engage extension
service providersMore cost effective for service providers to
reach the producers when they are organised into groups
Better articulation of needs
Benefits of farmer groups cont..Ensure traceability and other quality assurance
measures are export market requirements.Acquire the relevant certification for both local
super markets(Kenya GAPS) and export market(global GAPS). It is easy in groups such . E.g. of farmer association processors are New Kcc, Githunguri dairy, Meru DCU for milk.
Certification for markets is done by Government related bodies namely Kenya Bureau of Standards, Kenya Plant Health Inspectorate Service and Horticultural Crops Development Authority.
Value addition as part of marketing in KenyaAbout 80% of our agricultural products are
marketed in raw form.Policies and incentives however have been
put in place to promote value addition.Value addition levels for some crops include:
tea at 8%, mangos 10%, passion fruits 20% and Irish potatoes at 40% which are fried to chips in urban areas.
Value addition as part of marketing in Kenya cont..Most horticultural produce (vegetables and
fruits) goes to domestic market in fresh form about 95% and the other 5% goes to the export market.
Trade as means of marketingKenya’s export crops are tea, coffee and
horticulture(fruits, vegetables and flowers).Kenya belongs to two main regional trading
arrangements i.e. COMESA and EAC.The above two regional blocks offer a market
for the products which we have a competitive advantage.
The above RTA have customs union which allow for common external tariffs (0,10,25%) and a common market.
Thank you.
May God bless you