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Facilitating Equitable Agricultural Development in sub- Saharan Africa The Case of Kenya.

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Presentation on theme: "Facilitating Equitable Agricultural Development in sub- Saharan Africa The Case of Kenya."— Presentation transcript:

1 Facilitating Equitable Agricultural Development in sub- Saharan Africa The Case of Kenya

2 Contents O Objectives, TORs and methodology O Agricultural sector in Kenya: an overview O Evolution of polices and outcomes O Stakeholders and their relations O Stakeholder participation in policy process O The Private sector in agriculture O Smallholders and agricultural development O Challenges for various stakeholders O Recommendations

3 Objectives, TORs and Methodology O Analyse the enabling environment for inclusive agricultural development in Kenya O An overview of the sector O Policy, legal and regulatory frameworks in the sector O Relationships existing between policy makers and key stakeholders O Private sector in Agriculture and smallholders O Recommendations for policy

4 Methodology O Literature review O Secondary data from MoA, MoT and several parastatals O Primary data from O -FGDs with farmer organizations, O Key informants from agricultural sector O Consultations with FNRG

5 Agricultural Sector in Kenya: An overview O Contributes to 23 per cent of GDP, 65 per cent of total exports and 70 per cent of employment O Economic growth is highly correlated with Agricultural growth (figure 1.1) O More than 80 per cent of total agricultural production is done by low income smallholders with farms ranging from 0.25 to 2 acres O Consists of 6 sub-sectors – Livestock, food crops, industrial crops, fisheries and forestry O Horticulture contributes 33 per cent of GDP and 38 per cent of export earnings

6 Agricultural systems, production and trade O 16 per cent arable land in medium to high potential areas O Land fragmentation is too high, about 4 million farms are less than an acre O Small holders re about 6million with farm sizes ranging between 0.25 to 3 ha O Major crops cash crops include, horticulture, tea, coffee, sugarcane and cotton O Major food crops include maize and rice

7 Trends in productivity O General low productivity per ha for most crops except tea and horticulture O Decreasing area under production for key crops such as cotton, sugar, coffee which are directly linked to poverty alleviation O Increased area under production for maize but decreasing yields (productivity) O Low technology adoption and poor farming methods

8 Evolution of policies & outcomes O Pre-independence policies were mainly colonial, Africans were not allowed to grow any cash crops but they provided labor for the British farmers O Post independence – 1960’s to 70’s O government intervention and support in production and marketing O Smallholders organized in cooperatives O Rapid growth in agriculture (6 per cent)

9 Evolution of policies cont’d O Liberalization era 1980’s to 90’s O Liberalization as a conditionality for Aid O SAPs saw abolition of marketing boards and cooperatives O Abolition of government support in production and marketing O Declining growth in the sector to -4.1 percent at its lowest O Post liberalization policies eg SRA O Emphasis on the need to revitalize agriculture O Increased agricultural spending and an increase in agricultural growth

10 Stakeholders O G overnment institutions O Ministries – Ministry of Agriculture, Ministry of Regional Development Authorities, ministry of cooperative Development and Marketing, ministry of fisheries Development and ministry of Livestock Development O Their role is mainly policy implementation, creating an enabling environment O Parastatals for various crops – managing the production and marketing of various crops O Producer organizations – umbrella organizations for farmers O NGOs and civil society –advocacy and lobbying O Research institutions- provide evidence based research O Donor Agencies and ODAs, - funding for projects and programs O Farmers, private sector and agro-processors

11 Relationship between stakeholders O Individual smallholders produce or subsistence and may sell to middle men or producer organizations O Some have contractual arrangements with agro-processors e’g sugarcane industry O Middlemen either sell directly in the local markets, supermarkets or they sell to aggro- processors O relationship.docx relationship.docx

12 Relationships between stakeholders in policy process O Pre- independence policies were largely made by the colonialists to suit them, no participation of any other stakeholders O Post independence policies were dictated by the government with no participation from other stakeholders O In the 1990’s era of SAPS policy was largely influenced by doors and policy process was largely a donor / government affair O Post liberalization –involved participation of private sector lobby groups, advocacy through civil society and POs through policy round tables

13 Private Sector in Agriculture O Typology – O farmers, middlemen, Processors and foreign investors O Supporting institutions – financial and credit, capacity building, marketing and information support O Agro –processing and value added is still low O FDI predominantly large farms –dominion and horticulture sector (employment, vs competition) O Middlemen – exploitative to smallholders during surplus periods

14 Constraints for private sector development in agriculture O Macro-economic environment – inflation, high interest rates and high taxes O High cost of energy O High cost of labour O Poor infrastructure O Policy and regulatory environment not conducive for smallholders O Lack of clear regulatory measures to protect smallholders against exploitation by middlemen O Regional Trade policies that are not harmonized and therefore hamper exports O Cartelization o the agricultural sector

15 Smallholders in Agriculture and their constraints O Constitute 80 per cent of total agricultural output O Lack of technology and poor technology absorption O High cost of inputs O Lack of information and knowledge en better agricultural practices O Lack of proper marketing channels hence exploitation by middlemen O Poor access to credit O Poor infrastructure especially rural access roads O Cheap imports –sugar, maize, rice and cotton sectors (dis-incentive for production) O Lack of proper representation in policy decisions – lobbying is mostly done by large farmers eg wheat sector

16 Conclusions O Major highlights O Poor policy, legal and regulatory frameworks that hamper development of the sector O Poor resource allocation and investments in the sector by the government (poor planning) O Low FDI inflows O Low technology adoption resulting in low productivity O Poor infrastructure O Macro-economic environment that is not conducive for investments and growth of the sector O Corruption, cartels and cheap imports virtually leading to a collapse of sugar, cotton, rice and perhaps maize sectors

17 Recommendations O Need to increase resource allocation to a desired level of 10 per cent of government expenditure and a need to review recurrent vs. development expenditure O Urgent need for stabilization of macro-economic environment O Urgent need of investments in rural infrastructure and irrigation O Creation of a stimulus package for investments in agro- processing, value added and export promotion in the region O Addressing corruption and cartels hampering the development of some sub-sectors O Enhancing support services for smallholders by strengthening their producer organizations and cooperatives, including institutional capacity for policy advocacy and lobbying O Address regional disparity in resource allocation and government’s investments

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