Dec Jan Feb Mar April 2014

The agricultural sector has been a key contributor to economic growth since independence. The sector accounts for a quarter of the gross domestic product (GDP). In 2012, the sector contributed 25.9 percent to the GDP though the input is only realized from a third of the total land in Kenya. The almost 26 percent GDP input is contributed under subsistence or traditional farming methods while large scale farming is practiced in selected areas in the country and by a few.


The country’s agriculture sector since independence has never been mechanized owing to low investment both by the government and private sector. This has resulted to low yields coupled with poor quality of produce prompting the government to always import food every year to feed the increasing population.
National Treasury Cabinet Secretary Henry Rotich while reading the 2013/14 budget confirmed government commitment to fast track new strategies in the agriculture sector with the view to enhancing food security, job creation and wealth generation. In the current financial year a comprehensive agricultural strategy will be implemented to encourage high growth and rescue the country from food shortage. The strategy will be implemented by the budgetary allocation of Sh38.9 billion the ministry received for the 2013/14 financial year.
Though agriculturalists faults the figure arguing it is not adequate to support full scale growth in order to sustain the national economy, Rotich stated that government intention is to pursue sound initiatives to ensure the country’s food security is guaranteed to feed the surging population. Further, in the financial year 2013/14 the ministry will intensify efforts in promoting sustainable utilization of natural marine and inland water fisheries resources through intensified patrols to curb illegal fishing.  
The agriculture sector has faced a lot of challenges particularly in the 1990s when it was partially liberalized. Development partners especially the Bretton Woods institutions, World Bank and International Monetary Fund (IMF) pushed for adoption of the Structural Adjustment Programme (SAPs) which led to confusion among the farmers. The confusion led to decline in food production, increase in poverty and insecurity. Further, the liberalization move led to entry into the sector by multinational companies who are now carrying out commercial farming relegating the small scale farmers to subsistence farming.
However, after years of toiling without much benefit coupled with emerging dynamics, the tide is changing with farmers’ now embracing commercial farming where growers have resorted to various modern farming techniques and thus raking in substantial income. Farmers in both urban and rural areas are waking up to the reality that farming needs to assume a new approach based on the emerging dynamics especially population growth.
President Uhuru Kenyatta during the state opening of the 11th Parliament last April reasserted government commitment to revitalize the agriculture sector with the view to transforming Kenya into a middle-income country in the next 17 years. “Government will ensure food security by investing in and modernizing our agricultural sector. Through improved financing, irrigation, research and development and the return of extension services we will enable farmers to move from subsistence to commercial farming. We will support the National Land Commission and fund the adjudication and titling of land, assisting them in their endeavor to promote land ownership as a factor of production and thereby enhance food security,” he said.
Last month, the President initiated the national programme to enhance land ownership by giving tittle deeds. The process started in coastal region and it is expected to spread to other parts of the country.  
Over the years farming has assumed a new dimension with individuals and even groups embracing technology farming. For example, in various areas farmers are busy practicing money-making agribusiness, for example, greenhouse farming, fish farming, dairy farming and urban farming among others.
The youth, contrary to past notions that they cannot embrace farming to earn a living, are currently raking substantial cash thanks to adoption of greenhouse farming. The greenhouse farming is now gorgeous activity to the youth disabusing the notion that agriculture is only meant for the old. For instance, a group of 15 youths in Namanga area in Kajiado County are a happy lot after embracing greenhouse agriculture as an income generating activity.  
Olchanda Youth Group registered early last year is operating a double kit greenhouse to grow tomatoes for sale. Elias Mwiti coordinator of the group confirms that the group secured credit from the Youth Enterprise Development Fund (YEDF) under a loan product dubbed Agrivijana which targets youth of between 18-35 years. Amiran Kenya which has signed a memorandum of understanding with YEDF offered training on modern farming to the youth. The group borrowed Kshs358,344 from the youth fund and managed to acquire two mini greenhouse tunnels which have capacity of accommodating 600 tomato plants enough to produce 10,000 kilogrammes of tomatoes for a period of nine to ten months.
Before the end of this month the youth fund will have financed the setting up of 55 greenhouses in various counties in Nyanza, Central, Western, Rift Valley, and Eastern province. “We have signed an MOU with Amiran Kenya for the latter to supply greenhouses to youth venturing into commercial farming,” says YEDF agri-business project manager Morris Murimi. Under the programme the fund management says 400 greenhouses will be established thus contributing to creation of more than 1,000 jobs.
Urban farming is also taking shape in the country with landlords raking huge amounts of money for sale of products they are farming in spaces within their estates. In their home compounds landlords are using sacks, timber, buckets and small containers to grow food crops mainly, cabbages, tomatoes and onions.  
Urban farming in the country, however, is still untapped but the government realizing its potential has developed a policy which is currently being discussed by sector stakeholders. Nancy Karanja, a resident of Nairobi County says urban farming is taking shape owing to the expanding middle class and demand of food in the country. “Urban farming is a lucrative business which if fully utilized can assist growth in the country. The high demand of food that has been created due to the increasing urbanization can be realized through practice of urban farming,” she says.
Karanja on her part is equally earning similar proceeds out of urban farming in Njiru area of Nairobi County. Nancy in her one acre plot takes care of livestock, fish and grows fresh produce using the green house technology. The new concept is picking up especially owing to various dynamics such as population increase leading to pressure on available land for farming.
The government through the National Irrigation Board (NIB) is undertaking 120 projects geared towards increasing area under irrigation by more than 600,000 acres. The ambitious plan being implemented in various places in the country is being financed through budgetary allocation and donor funding to the tune of Kshs10.8 billion in the current financial year with the view to enhancing food security in the country.
NIB General Manager Daniel Barasa says the projects are being implemented under the Expanded Irrigation Programme (EIP) initiated in 2011 to accelerate irrigation expansion and development. The irrigation schemes are part of a comprehensive agricultural revitalization programme government is intending to implement in the current fiscal year aimed at expanding, enhancing productivity and transforming agriculture into a business venture.
Eng. Barasa added the projects will assist in involving more families into farming in order to produce for the surging population. “Presently, 120 projects have been established targeting to increase area under irrigation by 636,912acres. The projects which are at different stages of implementation are broadly classified as expanded irrigation programmes funded by the government and donors,” he said.  
Some of the irrigation schemes under the EIP are located in Machakos, Nyeri, Busia, Kitui, Makueni, Isiolo, Meru, and Kajiado counties. The board is implementing six irrigation development projects financed by various development partners among them JICA, World Bank, BADEA, Kuwait Fund and OFID. The projects include Mwea Irrigation Water Management Improvement Project, Kieni irrigation development, Kayatta irrigation, Bura rehabilitation and Lower Nzoia irrigation project Phase 1 and 2.
But various quarters have blamed the dismal growth of commercial farming in Kenya to lack of a comprehensive framework to guide partnerships between the government and the private sector. For example, farmers are not subsided unlike their counterparts in the developed world who are assisted with incentives thus being able to produce more food.  
Even though government has waived debts facing coffee, rice and sugar farmers, more is yet to be seen in terms of providing funds to support the growers expand their farming. This is well explained by the fact that Kenya is yet to enhance the budgetary allocation to more than 10 percent stipulated in the Maputo Declaration on Agriculture and Food Security in Africa of 2003.
In 2003 African heads of state met in Mozambique and pledged to allocate 10 per cent of their national budget to agriculture by 2008. To date, Burkina Faso, Ethiopia, Ghana, Guinea, Malawi, Mali, Niger and Senegal have exceeded this target and most countries have made significant progress towards this goal. The Declaration contained several important decisions regarding agriculture, but prominent among them was the “commitment to the allocation of at least 10 percent of national budgetary resources to agriculture and rural development policy implementation within five years”.  In Kenya the budgetary allocation stands at below five percent.  
The absence of the guiding structure has equally hampered the country’s efforts to enhance food security as farmers are not provided with incentives that would see them boost production. Government has embarked on a number of strategies to ensure the sector plays its meaningful role in the building of the national economy. Early this year, three legislations were enacted to enhance governance among others. The laws include Agriculture, Fisheries and Food Authority (AFFA) Act 2013, Crops Act 2013 and Kenya Agricultural Research and Livestock Act 2013. They were gazetted early this year after repealing of 131 Acts of Parliament that govern the sector.
In the current financial year, government will establish a Kshs2billion agri-business fund to de-risk and leverage commercial bank’s lending to smallholder and commercial farmers throughout the country. The fund will be increased to Ksh20billion in within four years to expand its access to as many Kenyans who venture in farming as a business.  
But changing dynamics in the sector including the government’s decision to enact a new framework geared towards engaging the private sector and other players in order to boost production has seen agricultural organizations begin responding to farmer’s needs. For instance it has led to the emergence of diversification farming approaches such as greenhouses, fish farming especially through fish ponds and irrigation.
Various companies and associations are undertaking programmes targeting the youth and small scale farmers. The efforts are geared towards repositioning agriculture as a lucrative occupation where farmers are generating income. Elgon Kenya and Amiran Kenya Ltd, for instance, recently initiated programmes aimed at educating the young people and small scale growers. The programme covers areas of training on best practices that would improve on crop yields, making the occupation attractive.
Bimal Kantaria, a director at Elgon Ltd says that his organization has invested over Kshs3 million in training targeting farmers in parts of Central and Rift Valley regions. “We believe training is a key component in making agriculture attractive to the youth and training programmes like this would help minimize wastage and improve crop yield in the country. This would make agriculture meaningful to the youth,” he said. Elgon Kenya intends to introduce more programmes that cover new technologies in crop production such as greenhouses.
Amiran Kenya Deputy Managing Director Yariv Kedar says his company has invested Kshs7.83 million to finance training of farmers as an alternative means to make agriculture attractive to both the youth and the old.
The fish industry for the last five years has recorded impressive performance as farmers embrace fish farming. Since 2009 the programme has led to the establishment of 50,000 fish ponds in various parts of the country. Players are raking significant revenue as well as assisting in job creation. Professor Charles Ngugi says fish production through the fish pond is a diversification strategy in the agriculture sector geared towards enhancing food security over and above income generation.

Corporate News

Jamii Bora Bank secures Sh600 million equity Finan...

Jamii Bora Bank Limited (JBBL), a fast growing SME focused bank, has received a Sh600 million equity [ ... ]

CMA ranked most innovative Regulator

The Capital Markets Authority (CMA) has received recognition for being the Most Innovative Capital M [ ... ]

PTA Bank rebrands, commits to increase funding for...

The Eastern and Southern African Trade and Development Bank, commonly known as PTA Bank, has changed [ ... ]

Recent Posts

A portal for Labour Market Information

Kenya is facing serious unemployment and underemployment challenges. According to the 2017 Human Dev [ ... ]

Why change? Why not?

One of the biggest mistakes we business people make is executing the plan/do model. We plan, and the [ ... ]

Need to Improve Employee Retention

In the recent past, there has been raging debate about the competency of our higher education gradua [ ... ]

Copyright © 2018 Small Medium Enterprises Today. All Rights Reserved.
Designed by : Penum Limited