Flower Industry in Kenya and Its Effect on the Economy

1.1 OVERVIEW OF THE FLOWER INDUSTRY

The Kenyan flower industry is the 3rd largest flower supplier in the world and is among Kenya's three top foreign exchange earners. It contributes to the country's prominence as a key African economy and has provided a source of income for many Kenyans. The industry has, however been the focus of several damaging media exposés and academic research articles documenting extensive human rights and environmental abuses. Furthermore, changes in consumer behavior in Western countries, the major importers of Kenyan flowers, are pressuring for a transition to more ethical business practices and towards credible accreditation. Industry stakeholders, NGO's and accreditation bodies have therefore taken steps to improve farms' conditions. The flower industry promises to make important contributions to Kenya's economic development by providing rural employment, attracting foreign investment, and improving domestic technology and infrastructure.

Kenya's horticultural sector currently ranks as one of the economy's fastest growing industries, the second largest foreign exchange earner after tea. This has been reflected in virtually year on year expansion in fruit, vegetable and flower exports, a trend that saw the industry rise 31% in 2003 with total exports reaching 130 000 tonnes in 2003. Top on the list of fresh horticultural crops exported annually are cut flowers, French beans, runner beans, snow peas, Asian vegetables, pineapples, mangoes, tomatoes, paw paws and passion fruit.

The history of the export of fresh horticultural produce from Kenya dates back to the period before independence when Kenya, then a British colony, was required to contribute to the running of the budget for East Africa. After independence the industry continued to flourish with exports starting to go to Europe and thus opening up the potential for Kenya in the export market.

Overall exports to the European market started to increase in the 1970's with the Netherlands being the largest importer, taking a 71 per cent share by volume, with most distributed through the auction system. Next came the United Kingdom on 20 per cent, followed by Germany on 6 per cent. Success can be attributed to Kenya's ability to provide high quality products on a year-round basis, backed by daily airfreight arrivals to key destinations.

Kenya has seen phenomenal growth in its exports of cut flowers recently even taking into account mounting competition from Colombia, Ecuador, Israel, India, China, Zimbabwe, Zambia, Ethiopia and Uganda. The Kenya flower industry like the horticultural sector is continuing with its rapid growth and in the year 2000 saw another 3.6 percent increase in exports to a record 38,000 tonnes. The export of roses continued to dominate the export market with sales up from 24.6 million kilograms in 1999 to 28.4 million in 2000, a