Unveiling the statistics in Nairobi, Hosea Machuki, Chief Executive Officer of Fresh Produce Exporters Association of Kenya said the sector has remained resilient amid various challenges, both fiscal and operational.
“The sector has seen marked resilience and continued growth and huge potential which has enabled it weather various challenges such as the Brexit shock and fertilizer shortages which the sector faced,” said Machuki said.
Flower exports contributed 113.16 billion shillings ($1.1 billion) up from 82.24 billion shillings ($818 million) earned in 2017, representing 37.8 per cent growth.
Fruits and vegetables earned 12.83 billion shillings ($119million) and 27.68 billion shillings ($26 million) in 2018, up from 9 billion shillings ($89 million) and 24.06 billion shillings ($239 million) earned in 2017, respectively.
The cut-flower export still remains the largest earner, contributing 74 per cent of the total fresh produce annual earnings, fruits at 8 percent and vegetables at 18 percent.
In 2018, the horticulture industry was hit hard by acute shortage of soluble fertilizer resulting from stringent and lengthy clearance process by the Kenya Bureau of Standard at the port of entry.
The sector was also hit by the imposition of 16 percent Value Added Tax on pest control products and VAT return estimated to be 3.5 billion ($30 million) increasing the cost of production, resulting in non-competitiveness in the international markets.
“These challenges has compounded the many challenges Kenyan farmers face including numerous taxes, and levies at national and county governments, high energy costs, trade and phytosanitary restrictions in several potential markets, and the recent notice on closure of run-way during the valentine peak season,” said Clement Tulezi, chief Executive Office, Kenya Flower Council.