KENYA – Pakistan and Kenya have held discussions on ways to enhance bilateral trade in the agricultural sector between the two countries, notably in tea export and rice import.
Speaking in Islamabad after holding bilateral talks with the Pakistan Federal Minister of Food Security and Research, Chaudhary Tariq Bashir Cheema, Kenya’s Agriculture and Livestock Development Cabinet Secretary Mithika Linturi announced major strides in improving the current inter-trade relations.
In addition to the tea sector partnership, Linturi noted the government is pursuing knowledge transfer from Pakistan, especially in the implementation of modern farming technology like drip irrigation, to improve Kenya’s food security.
Pakistan, which is a relatively Semi-Arid country with a population of 220,000 million people, is food secure due to reliance on irrigation farming.
Sources to pt Profit, a Pakistan media house, said that Pakistani authorities proposed a barter trade system due to the ongoing economic crisis. Islamabad plans to export rice and pharmaceuticals in return for tea from Nairobi.
According to Pakistan’s tea association, the country has imported almost 234 million kg of tea from Kenya in the last year, while the importers have also paid Rs65 billion in revenue to the government.
The tea industry is among the leading foreign exchange earners for Kenya, accounting for 26 percent of the foreign exchange earnings and two percent of the National Gross Domestic Product.
In a bid to boost its exports to the leading tea export market, Pakistan, accounting for 52% of total tea exports, Linturi said the Kenyan government is working to ensure that Kenya’s tea is exported with added value.
Speaking in Karachi, Pakistan, during the Pakistan Tea Association annual gala event, The CS noted the move will increase the farmers’ and exporters’ earnings.
He said: “Kenya is rated among the highest producers of quality tea worldwide with 77 market destinations worldwide, but our export earnings are not higher than other countries like Sri Lanka and China who export their tea with added value.”
“Pakistan imports 52 percent of Kenyan tea, making it our largest trade partner in the tea sector, but we are still facing challenges in the trade due to lack of value in addition to our tea.”
Among the efforts taken to increase export with added value, the CS said, include the establishment of Special Economic Zones (SEZ) in Mombasa to replace the current Export Promotion Zones (EPZ). The establishment of SEZs is a key flagship project under the Kenya Vision 2030 economic pillar.
According to Linturi, the SEZs may be a better scheme to circumvent challenges faced in the tea sector than the EPZs owing to numerous administrative, monetary, and tax incentives.
He further promised to develop a tea subsector by providing fertilizer subsidies to cushion farmers against increasing the cost of production, as well as introduce other incentives to further enhance the competitiveness of Kenyan tea globally.