17 May 2018

Kenya: High Costs Taking Shine Off Tea, Coffee Exports to UK

Kenya could lose its competitive edge in coffee, tea and flower exports to the UK on account of high cost of production compared to other exporters.

A report by Overseas Development Institute in partnership with Export Promotion Council (EPC) indicates Kenya is ceding its share of the market to rivals such as Rwanda, Ethiopia, Cote d'Ivoire and Zimbabwe.

Kenya, known for its cut flower to the European market, is losing out to Ethiopia, which is coming out strongly in floriculture. The county is also losing to Rwanda on fermented black tea and coffee to Cote d'Ivoire.

Aarti Krishnan, a senior research officer with the Overseas Development Institute said Kenya has to diversify exports to the UK market, cut down on cost of production and provide incentives to boost share of trade in Britain andcompete with the emerging threats. "The government has to step in and address standards, cost of production and offer incentives to remain relevant in the UK market," she said.

She pointed out that, for instance, Ethiopia has offered incentives to farmers and exporters, who enjoy subsidised freight charges to European market.

"There has been stiff competition that has affected the value of goods that we export to the UK market and this report is aimed at helping us to restore our share," said EPC chief executive officer Peter Biwott.

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