Dar es Salaam, Tanzania — The European Union (EU) has announced that it will spend Euro 4.5m ($5.88m) to support horticulture sector in a bid to increase smallholder farmers' income through better access to markets.
EU and the government of Tanzania have recently signed a financing agreement for the 10th European Development Fund - Support to Trade and Agriculture in Tanzania, a statement availed to East African Business Week in Dar es Salam said.
"This support aims at providing support on key commodities which offer opportunities for pro-poor trade, such as fisheries, cotton, coffee, tea and horticulture," the EU Ambassador to Tanzania, Filiberto Sebregondi said.
In line with the recently adopted Tanzania Horticulture Development Strategy 2012-202, the support to the horticulture sector will aim to increase smallholder farmers' income through better access to markets (national, regional and international markets), strengthening value chain linking smallholder farmers to markets.
Mr. Sebregondi said; "The present support will contribute to the development of the horticultural industry, increasing production income generation and consumption of fresh horticultural produce in Tanzania."
He added that by fully exploiting the potential of this sector, it can contribute to improving nutritional status and poverty alleviation.
"The projects to be supported should be demand-driven from horticulture stakeholders to exploit the fast growing demand and market opportunities available at the national, regional and international markets but should also contribute to a long term goal of strengthening the capacity of the sector," he said.
On his part the Deputy National Authorising Officer for European Development Fund (EDF), Mr. Samuel Marwa expressed the government's appreciation to the EU and its member States for the support.
"The government appreciates the timely decision by the EU and its member states to allocate funds for financing the horticultural sub-sector in Tanzania...this support has come at the right time given the challenges being faced by the horticulture sub-sector," he said.
In Tanzania, the horticultural sector has set an ambitious target to raise revenue of $1bn over the next five years to compete favourably with the regional leader, Kenya.
The Permanent Secretary in the ministry of Agriculture, Food Security and Cooperatives Mr Mohamed Muya said that the sector's phenomenal growth over the last few years is set to grow even further.Muya said that the country was gearing up for competition, with the target of raising a minimum of Tsh1.4trn ($876.76m) by 2015 from the current Tsh150bn ($93.91m) annually.
Kenya currently collects Tsh3trn ($1.88bn) from its flower farms despite the fact that Tanzania has more fertile land than the rest of the EAC member countries.
"The horticultural products' market is growing very fast with commodity prices shooting up every day," Muya said.
Horticulture industry is the fastest growing sub-sector of the national economy, with a growth rate of 8-10% per annum.
It encompasses the production, processing and marketing of flowers, fruits, vegetables, seeds, spices and herbs.
The subsector has been recognized as an engine for country's social-economic growth and a significant contributor for rural poverty alleviation. The industry generates more than $358m per year and it offers direct employment to about 350,000 Tanzanians.