19 May 2019

Kenya: Agriculture Masterplan Requires U.S.$2.2 Billion

Kenya requires a staggering $2.2 billion to resuscitate the agricultural sector from its current decay and ensure the country becomes a key regional food producer.

Another $2 billion is needed to finance infrastructure projects like roads in areas with high agricultural potential to ensure that produce reaches markets.

The enormous financial requirements form the bedrock of a new agricultural sector revival master plan that Kenya has developed.

"The strategy is based on the belief that the food security requires a vibrant, commercial and modern agricultural sector that supports Kenya's economic development sustainably and its commitments to regional and global growth," says the Agricultural Sector Transformation and Growth Strategy.

Ironically, Kenya has come up with a new agricultural sector master plan even as numerous other blueprints are gathering dust in government shelves while the ambitious Galana-Kulalu irrigation project, intended to be a model in irrigation-drive agriculture has collapsed after gulping about $100 million.

According to the Economic Survey 2018, Kenya's food import bill declined in 2018 to $1.7 billion due to favourable weather conditions from a record high of $2.3 billion in 2017.

One-stop shops

In coming up with a new strategy, Kenya is taking the cue from Ethiopia and Tanzania, which have managed to fix the sector by increasing the productivity of smallholder farmers, expanding large-scale commercial farming and investing in agro-processing.

The two countries have witnessed substantial growth in production averaging 8.9 per cent annually.

The new blueprint states that up to 80 per cent of resources required to revive the agricultural sector will be financed through public-private partnerships in the agro-processing and increasing arable land under cultivation.

The government and its development partners will put in the remaining 20 per cent, meaning the Exchequer must raise an additional $10 million annually in budgetary allocations, a 30 per cent increase from current levels.

Another goal under the master plan is to unlock 50 new large-scale private farms with 2,500 acres or more, a move that should release some 150,000 acres for crop production.

The country will also work to set-up six agro-processing hubs using a one-stop-shop; it will also set up a rapid public-private partnerships process for local and export markets, strengthen research and innovation and monitor food system risks like pests, diseases, climate change and global price shocks.

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