Kenya’s open borders spell doom for struggling farmers

Kenya, a nation whose growing population’s appetite and tastes have grown in leaps and bounds, is struggling to feed itself.

Unable to boost local production to meet its insatiable demand, the country has opted to keep its borders open to free inflow of all kinds of food products.

In the next 12 months, for example, its East African Community (EAC) neighbours Tanzania and Uganda will shut their borders tight against the entry of most food products from outside the region. Kenya will not.

Imported food in Uganda, including processed tea and coffee, chocolate, biscuits, sausages, refined sunflower, onions, and garlic, will attract a tariff of 60 per cent as opposed to the common external tariff (CET) of 25 per cent, reveals the latest EAC Gazette notice.

For Tanzania, imports of processed coffee, chocolates, sweets, tomato sauce, and chewing gums will be slapped with a duty of 35 per cent.  

However, Kenya, with ambitions to industrialise by 2030, has opted to protect select industries such as steel, paper, wood, and textile with an import tariff of between 25 and 35 per cent (in the case of textile) rather than CET of 10 per cent.  Farmers, on the other hand, have been left to their own devices.

Dr Kennedy Manyala, an economist, says Kenya has to partially close its borders if it is to industrialise, noting that the clearest sign of a poor nation is having a disproportionately large agricultural sector.

This explains why the country is finding it prudent to protect its industries, but not its farms. Because Kenya’s manufacturing is largely agro-based, the neglect of agriculture has had a knock-on effect on the country’s industrialisation.

Until June 2022, a starving Kenya will keep its doors open to all manner of food imports, catalysing the death of the nation’s critical sector. It will let in all sorts of food and beverages from the region and beyond at EAC’s CET or, as in the case of wheat, lower.

Wheat, whose consumption per person has more than doubled in a decade to 2018, will attract a duty of 10 per cent instead of the CET of 35 per cent.

Maize, the country’s staple food might also join wheat in the list of food commodities that Kenya wants to be exempted from the 35 per cent CET.

This is if the Agriculture Cabinet Secretary Mwangi Kiunjuri has his way.  

Last year, official data showed that the country spent Sh174.9 billion importing food and beverages.

This was an increase of 214 per cent from Sh53.6 billion it spent a decade earlier in 2008.

As a share of total imports, food imports have increased from seven per cent in 2008 to 10 per cent last year, with the country’s imports dependency ratio (IDR) getting worse.

IDR shows the extent to which a country is dependent on food imports over its domestic supply. And Kenya has increasingly been relying on food produced elsewhere.

Not so much for its neighbours. According to figures by United Nation’s Food and Agriculture Organisation (FAO), Uganda, Ethiopia, Tanzania, and Rwanda, have lower cereal imports dependency ratio, meaning most of their domestic supply of maize, wheat, rice, and other cereals are produced locally.

With a three-year average of 32.7 per cent between 2011 and 2013, Kenya has the highest cereals IDR, higher than Africa’s average of 28.9 per cent.

Ethiopia’s dependence on imported cereals is at seven per cent, Uganda (8.6 per cent), Tanzania (12.2 per cent) and Rwanda (32.5 per cent).  To agricultural experts, sufficient supply of cereals is an indicator of food security in a country.

Timothy Njagi, a research fellow at Tegemeo Institute, an agricultural policy think tank, says the high consumption of rice and wheat are responsible for the increased cereal imports dependency ratio. 

“There was a time we imported only 60 per cent of our wheat, now we are importing 90 per cent,” said Njagi, noting that most wheat farmers have since divested into maize.

A new report on the food situation in the country by the Kenya National Bureau of Statistics (KNBS) shows that between 2013 and last year, the country’s total food import dependency ratio rose from 10.5 per cent in 2014 to 18.5 per cent in 2017 before it declined to 15.1 per cent in 2018.

Except for animal products and potatoes, Kenya has had to import nearly all the other food crops to supplement depressed local production.

KNBS notes that an increase in the country’s overall IDR was mainly due to increased importation of vegetable products whose IDR increased from 12.7 to 22.5 per cent between 2014 and last year.

“This implied that more vegetable products were imported so as to meet the rising demand in the country,” read part of the report.

Fish, whose importation, especially from China, has always touched a raw nerve, actually has the highest IDR, surging from 19.4 per cent in 2014 to 30.6 per cent in 2016.

In the latter year, Kenya imported processed fish worth Sh1.5 billion from China, Thailand, and UAE, according to data from the United Nations.

The country also bought Sh373 million worth of fish liver oils from the UK; Sh363 million worth of fish fillets from Tanzania, China, Norway, Uganda, and the UK.

The demand for fish among Kenyans has gone up significantly, with a recent study on the consumption patterns of meat by Kenya Markets Trust, a non-governmental organisation, showing that low-income households preferred fish to beef as it (fish) can come in “manageable portions.”

“Consumers in the low-income segment prefer fish because of the ability to buy cheap portions and products like omena and fish remains that can be stretched to feed more people than the smallest units of red meat,” read the report in part.

Maize’s IDR has been erratic. It decreased by 62 per cent to stand at 4.9 per cent as production in 2015 improved. Then a debilitating drought in part of 2016 and 2017 saw maize’s IDR shoot to its highest level - 33.4 per cent.

Some 15 million bags of maize valued at Sh39.6 billion were imported in 2017. As the country has grown richer, supported mostly by an expanding service sector, consumption of food per person for almost every foodstuff, including cereals, fruits, meat, and milk has increased.

In 2013, one person consumed, on average, 28kg of wheat.

This increased to 41.3kg last year. It is the same with rice whose consumption per capita in the same period increased 8.4 per cent from 12.2kg in 2013 to 20.6kg in 2018.

However, consumption of milk and products has declined by 19.5 per cent from 112.8kg to 93.3kg in the period under review.

Consumption of potatoes per person also declined from 41.9kg to 29.9kg.   

Most of Kenya’s imported food comes mainly from Uganda and Tanzania. The rest, especially processed, is brought in from Asia and Europe.

Imports of primary foods such as maize, onions, tomatoes, garlic, beans, eggs, tea, milk, citrus fruits have increased eight-fold in the last 10 years in value - from Sh3 billion in 2008 to Sh25 billion in 2018. Most of these foods and beverages have come from Uganda, Tanzania, and Ethiopia.

Between 2011 and 2018, the trade surplus that Kenya enjoyed against the three East African nations, as it exported to them more than it imported, has been slashed by 61 per cent from a net export of Sh104.8 billion to Sh41 billion.

The gain has been tremendous for Uganda. In 2011, Kampala’s exports to Kenya - mostly agricultural produce - were valued at Sh10.3 billion. Seven years later, exports had increased by nearly five-fold to Sh49.4 billion.

Also, as more Kenyans have found themselves in urban settings where they have been too busy to prepare ugali, they have increasingly shifted to non-maize, processed foods, especially those made of wheat.

For example, while the per capita consumption of maize has stagnated at 69kg in ten years, that of wheat and wheat products has more than doubled from 16.3kg in 2008 to 41.3kg in 2018.

Thus, a lot of the foods that Kenya has imported have been processed, rising by 60 per cent from Sh27.4 billion in 2008 to Sh88 billion last year.

Interestingly, some of the processed foodstuff Kenya has imported, such as processed tea, tomato paste, and tropical fruits left the country in raw form.

For example, in 2016, Kenya imported processed tomatoes worth Sh666 million after exporting raw ones valued at Sh5.9 million to countries such as Qatar.

Majority of the processed tomatoes came from China. Other countries where Kenya imported processed tomatoes include the UAE, Italy, and Egypt.

In 2016, tropical fruits such as mangoes worth Sh10 billion were exported to France, Netherlands, Germany, the UK, UAE, and other European and Middle East countries. Yet, the country spent Sh634 million to import fruit juice from South Africa, UAE, Egypt, the UK and Spain where Kenya had sold its raw fruits.

Failure to improve its agricultural productivity, including protection of farmers, has had a knock-on effect on the manufacturing sector which is largely agro-processing.

Kenya has been lackadaisical in its handling of the agricultural sector. Experts reckon that agriculture, which is a devolved function, has been abandoned by both the county and national governments, with each pointing an accusing finger at the other.

Kenya’s growth of total factor productivity (TFP) or the portion of output not explained by the number of inputs used in products such as seeds, fertiliser, labour - lags behind Rwanda, Ethiopia, and Tanzania, according to a World Bank study.

Kenya’s TFP is also well below that recorded for South Asia and South East Asian countries. The World Bank blames ineffective knowledge delivery system, including poor agricultural extension and advisory services, inability to adopt high-yield seeds and improved fertiliser usage for the decline in Kenya’s TFP.

For example, despite Kenya offering fertiliser subsidy to maize farmers, yields (1,628Kg per hectare in 2015) remained lower than its neighbours (Ethiopia and Uganda), found the World Bank report.

The yield levels were even lower than those achieved two decades ago (1,918 Kg/ha in 1994). “Rwanda and Ethiopia have benefited from increased investments in agriculture, specifically in terms of knowledge dissemination through extension services and use of technologies such as improved seed and fertiliser,” read the World Bank report.

For Kenya to raise its agricultural productivity levels, reckoned the World Bank, it has to increase its use of inputs which must be coupled with knowledge dissemination. The Government has unveiled a plan to ensure universal access to nutritious food as part of President Uhuru Kenyatta’s Big Four agenda.

Despite 83 per cent of its land being arid and semi-arid, only two per cent of Kenya’s arable land is under irrigation compared to an average of six per cent in sub-Saharan Africa and 37 per cent in Asia, according to the World Bank study.

As part of the food security pillar, the Government intends to place an additional 700,000 acres through private partnership programmes under maize, potato, rice and feeds production. It also plans to expand irrigation schemes and secure water towers and river ecosystems.

“On agro-processing, the strategy will involve the establishment of 1,000 SMEs focused on food processing to improve value addition, redesign of the subsidy model by focusing on specific farmers’ needs,” said Treasury in the 2018 Budget Policy Statement.

The Agriculture Ministry in partnership with the Council of Governors will also mobilise about Sh22 billion through a four-year strategy aimed at making agriculture attractive to young people.