Delayed tax refunds and high charges facing horticultural producers have come under scrutiny, with Agriculture Cabinet Secretary Mutahi Kagwe calling for reforms to give investors more room to grow their businesses and create jobs.
Kagwe said the government must make it easier for horticultural companies already operating in Kenya to remain profitable and put more money back into their businesses rather than face rising costs that could limit expansion.
Speaking during a horticulture industry showcase, the CS called for legitimate tax refunds to be processed and paid more quickly, saying investors could use the money to expand their operations and support additional employment.
Kenya’s horticulture industry contributes about Sh145 billion to the economy each year, with the flower industry making up approximately 57 per cent of that contribution.
Kagwe said investment in the sector was already creating opportunities for value addition, pointing to the local packaging of Kenyan flowers for supermarkets in the United Kingdom as an example of how reinvestment can support jobs and increase the value of exports.
He further called for a review of levies, tariffs and other charges imposed on horticultural producers, arguing that lowering the cost of doing business would encourage more production and investment.
“You cannot get growth out of taxation. You get growth out of production,” the CS said.
Kagwe said Kenya’s trained workforce remains an important advantage for the horticulture industry, but added that investors also need a predictable environment in taxation, security and tariffs if they are to remain and expand their operations.
He urged Kenyans to take a greater interest in the sector and invest across the horticultural value chain, alongside international investors already operating in the country.
At the same time, the government is working on measures to help the industry deal with climate change and interruptions affecting major international markets, Kagwe said.
He pointed to research on crop varieties that can withstand climate-related challenges and the use of new technologies as part of efforts to protect future agricultural production.
Kagwe also announced plans to set up a private-sector liaison function at the Kenya Agricultural and Livestock Research Organisation (KALRO).
The proposed function is intended to bring researchers and industry players closer together, ensuring that public research responds to problems facing producers while also helping research institutions learn more about innovations coming from private companies.
The government is also expanding the use of digital tools in agriculture through the Kenya Agricultural Digital Information Centre (KADIC).
Kagwe said the programme covers technologies such as drones for spraying, soil testing and soil analysis, with soil health receiving increased attention as farmers turn to technology to improve production.
On export markets, Kagwe said the European Union remains a key trading partner for Kenya’s horticulture industry.
He said Kenya is up to date with the agreements and requirements that guide its trade with the bloc.
However, the industry continues to face external pressures, including geopolitical disruptions in the Middle East.
According to Kagwe, these disruptions affect Kenya’s access to markets for exports such as flowers, tea and coffee, while also affecting the supply of important agricultural inputs such as fertiliser and petroleum products.
Despite the challenges, the CS said the horticulture industry continues to grow and that the government will work with industry players to strengthen its competitiveness.
He said the focus will also be on increasing value addition, creating more employment and expanding opportunities for Kenyan produce in international markets.