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Informal stakeholder meeting_kenya_ppt-victor

Informal stakeholder meeting_kenya_ppt-victor






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    Informal stakeholder meeting_kenya_ppt-victor Informal stakeholder meeting_kenya_ppt-victor Presentation Transcript

      • Context and Study Objectives
      • Exploring Agritrade-Rural Livelihoods-Food Security Linkages
      • How Regional and International Agritrade Impact Rural Livelihoods and Food Security
      • Policy, Institutional Frameworks and Interplay of Stakeholders
      • Conclusions and Recommendations
      • World’s malnourished increased from over 800 million in 2008 to 923 million in 2009 (FAO, 2009)
      • Kenya ranks 29 among the countries with worlds poorest food security
      • Effects partly due to recent droughts and rising food prices as well as rising poverty
      • Rising food poverty: expenditure is about 60 percent of poor household’s incomes
      • 70 percent of the Kenyan population are market-dependent and net buyers of food
      • dependence on rain fed agriculture has seen output from maize fall from a surplus of 9 million bags in 2006 to a deficit of 35 million bags at present.
      • Kenya thus relies on imports and Trade is important for stabilizing the national food supplies and food prices.
      •   However trade is affected by tariffs, NTBs and subsidies.
      • After Government Withdrew agricultural support measures following liberalization:
        • food security started worsening by early 90s
        • By 2003, the country relied more on imports to fill food deficits;
        • About 25% of value of agric exports and 14% of the total exports were now being diverted to import food .
        • Food imports have not necessarily helped the poor since at household level (mainly in the rural and among the poor in towns and urban centers) food insecurity has increased;
        • incomes of the poor have plummeted, and they can’t sufficiently buy the imported food from the market
    • Some Stylized Facts about Kenya Agritrade, Poverty and Food Security
      • Trade deficit has been widening
      • Value of exports increased by 14% in last 2yrs but that of imports grew faster and at a higher rate (16%)
      • Poverty still remains high and overlaps largely with rural areas
      • Where 67% of pop lives, affecting largely small-scale farmers
      Variable 2000 2002 2003 2005 2006 2007 Economic growth 5.8 1.3 Agric as % of GDP 24 Exports value (mn) 69,285 244.5bn 412.4bn Imports Value 314.9bn 605.1bn Export as % of GDP 23.6 27.4 25.1 Import as % of GDP 30.4 29.8 37.5
    • Poverty Rates Selected Years (1992-2007)
      • With such statistics in poverty, there is also a markedly increase in food insecurity in the past few years
      • Food Security definitions
        • secure access by all people at all times to enough food for a healthy, active life’ World Bank (1996). This implies
          • Availability of enough food for an active healthy life;
          • access to this food; and
          • the guarantee of access to it at any time [Christiaensen 1995]
        • Availability is thro local food prod or imports ; access is thro ability to purchase enough quantity of quality food ( income and food price ) and this to be so on a sustainable basis
      Region 1992 1994 1997 2000 2007 Rural 42.o 46.8 52.9 59.6 49.1 Urban 29.3 28.9 49.3 51.5 33.7 National 46.3 46.8 52.3 56.8 46 Source: Kenya Economic Surveys (Various Issues), KNBS 2007
      • Identify linkages between trade, rural livelihoods and food security more specifically within the Kenyan context.
      • Determine magnitude and composition of regional trade in Agriculture (both formal and informal) and inherent effects on rural livelihoods and food security.
      • Carry out a review of national policies related to agriculture – food security, trade, and regional integration
      • Literature review to establish the Linkages between Trade, Livelihoods and food security.
      • Secondary data used for trend analysis
      • Primary data – FGDs with farmer organizations.
        • Key Informants
      • Review of Policies, Legal and Regulatory Frameworks
      • Dependence on Agriculture for Livelihoods
      • In the rural the poor are linked to agriculture as
          • farmers, laborers, transporters, marketers and processors of produce and as suppliers of non-agricultural services to households whose income is principally agriculture-derived
          • food purchase is their main consumption expenditure
      • In the rural towns and large cities
          • They engage in the processing and distribution of agricultural products from the hinterland.
          • They buy most of their food needs in addition to supplies from rural relatives, and
      • So to the extent that trade affects agriculture then it affects rural livelihood as well
      • Agricultural trade and Rural Livelihoods (II)
      • Thus if incomes from agric trade are rewarding then we expect:
        • Rural households’ incomes to increase hence increased demand for food and other consumer goods,
        • creation of non-farm jobs and employment diversification, especially in small towns close to agricultural production areas
        • surplus rural labor is absorbed, raises demand for agricultural produce and again boosts agricultural productivity and rural incomes
      • Thus, impact on rural livelihood comes through
        • falling real food prices,
        • creation of employment,
        • higher real wages, and
        • rising incomes fro small farm households
      • Agricultural trade and Rural Livelihoods (III)
      • Trade affects rural livelihoods through importation and exportation and policies thereof
      • Domestic
        • Production, with main determinant being price farmers receive and boost government revenue which can also be ploughed back through support
        • Policies (like subsidies) that dampen world prices create uncompetitiveness of products produced by countries who cannot afford subsidies
        • Reduce incentive to invest in agricultural infrastructure, agricultural research and development,
      • Agricultural trade and Rural Livelihoods (III)
      • International
        • Countries can produce and export based on their factor endowments
        • Use income from exports to import national food requirements
        • Ability to import food depend on incomes generated from imports and world price of food
        • Thus Export competitiveness and price matter
      • Linkages between agricultural trade and rural livelihoods therefore occur in three phases according to Evans 1990:
      • 1. rural households earn higher incomes from production of agricultural goods for non-local markets, and increase their demand for consumer goods
      • 2. this leads to the creation of non-farm jobs and employment diversification, especially in small towns close to agricultural production areas
      • 3. which in turn absorbs surplus rural labor, raises demand for agricultural produce and again boosts agricultural productivity and rural incomes (Evans, 1990).
      • Trade Liberalization such as SAPs – many sectors became uncompetitive.
      • International trade policies such as
      • Subsidies -dampened world prices, leading to collapse of many agricultural sectors in developing countries
      • NTBs – such as standards have also acted as barriers for developing country exporters.
      • Consequently, production declined and this led to a drop in employment for farmers and dependency on imported food leading to major changes in food prices and worsening the food security and livelihoods situation.
      • Poverty rates in Kenya are 46.1 percent. Rural poverty is higher than the national average and stands at 49.1%.
      • Rural poverty mostly associated with agriculture and land
        • Highest in ASALs in Eastern and North-eastern – due to poor climatic conditions
        • High potential areas e.g Central are over exploited due to population pressure
      • Poverty is highly correlated with food security i.e high poverty areas are the most food insecure – Asals and Coast
      • Food security worsened since 1990s and by 2003 imports were 14 percent of total value of imports and 25 percent of agricultural imports.
      • Statistics show that only 47 percent of the entire Kenyan population is food secure.
      • Hence Kenya’s dependency on food Aid has continued to rise over the years and is observed to have high peaks in 1993, 2001 and in 2007
      • Currently WFP is feeding a total of 3.6 million people in 25 districts and 535,000 children are given school meals through the school feeding program
      • Food imports especially cereals have also increased – deficits last year was 95,000MT met through imports
      • Most imports come from the region Uganda and Tanzania 108,155 MT and 56,900 respectively
      • More than 70 percent of Kenya’s Population live in rural areas
      • Agriculture and pastoralism the mainstay of the Kenyan Rural economy
      • An average of 68% rural household income is derived from off-farm incomes, and around 32% comes from own production (crops and livestock products), with maize and wheat being the leading sources of crop income.
      • Incomes from Agriculture alone are not sufficient to meet food needs especially in ASALs hence purchase of food is very common.
      • Exports
        • dominated by the agricultural sector- horticulture 22%; tea 17.9%, others eg petroleum and manufactured exports about 45 percent of exports.
        • Main destinations EU – 22 %; and Africa – 60 Percent
        • Exports to the COMESA and EAC region consist of manufactured products such as Fermented tea (35%), Cement (4.5%), Cigarettes (4.2%) amongst others
        • Exports to Africa increased 26% in the past 10 years
        • Exports to Africa facilitated by EAC and COMESA customs union
        • - Main barriers to Exports include NTBs, poor infrastructure and delays at various border points
      • Imports –
        • Kenya’s imports mainly consist of petroleum products (14 percent of total imports); crude petroleum (9 percent); industrial machinery (11 percent); and motor vehicles (6.4 percent).
        • Main source of Kenya’s imports include Middle and Far East, UAE and EU countries including South Africa.
        • Kenya also imports food specifically maize from EAC and COMESA countries to meet shortages
      • an important aspect of cross-border trade among small traders along Kenya –Uganda and Kenya-Tanzania borders
      • Provides a source of income for traders and also provides food – improved access to food.
      • Occurs due to restrictive policies and NTBs – Magnitude is hard to measure
      • Involves small but significant amounts of food products moved over short distances using as bicycles, and boats
      • Goods entering Kenya included, maize, beans, bananas, fresh fruits and vegetables-tomatoes, onions avocados, pineapples and Textiles
      • Goods leaving Kenya included counterfeit batteries, cigarettes, detergents, beverages, sugar, mattresses and other household goods
      • Reasons for illicit trade:
        • delays at the border which in some cases along Busia-Malaba border was up to 7 hours
        • High Administrative costs -numerous requirements such as trade licenses – business and road license, phyto-sanitary certificates
        • Corruption and bribery at police checkpoints
      • Magnitude is hard to measure
      • Positive aspects#
        • Improve access to food#
        • drives down prices of goods# - a plus for consumers but not producers
        • Provides incomes and improves livelihoods for traders#
      • Continued high prices of food due to:
        • a) sustained high level of effective demand in the country, especially in main urban centers,
        • b) accelerated appreciation of the Kenyan currency in recent years
        • c) the impacts of increased internal production costs, given the general cost of inputs and other production outlays, and
        • d) the overall rise in inflation, - rising to 31.5 percent in May and 29.4 percent in June 2008,
        • e) Overwhelming dependence on maize as the key staple for the majority of the population.
        • f) drought and poor weather conditions;
        • g) rising food prices which is a global phenomenon as well as
        • h) The post-election violence which occurred in 2008 January
      • Increased imports – cheap food imports acting as a dis-incentive for producers although this has improved access to food
      • On one hand –loss of incomes for producers and labourers but on the other hand creation of employment and incomes for traders
      • Dependency on food aid has also acted as a dis-incentive for production although it has provided much needed food for millions of people in extreme food insecurity
      • Trade liberalization under SAPs and various trade agreements such as EAC and COMESA have led to openness and reduction of tariffs
      • Even after the trade regime was liberalized cheap food imports have suppressed domestic food prices and therefore food production
      • Food security policy has laid much emphasis on Maize sector ignoring other sectors which could raise incomes of rural folk#
      • Food Security policy not coherent with trade policy
      • Food Security#
        • Kenya Food Security Meeting & - Advisory role
        • Kenya Food Steering Group – Policy and administrative
        • NCPB – strategic grain reserve
        • Ministries and Government departments –MoT, MOA
      • Institutions for food security not coherent with those of Trade
      • Stakeholders: Farmers and Small scale traders; Millers and Transporters; ODAs and NGOs;
      • Need for an equitable global environment for trade; removal of subsidies.
      • Taking care of regional NTBs to enhance regional trade
      • Most of what needs to be done is mainly at National level
        • Need for a clear and comprehensive trade policy that takes into account food security issues
        • Addressing infrastructural bottlenecks and redistributive mechanisms from surplus to deficit areas.
        • Need for a comprehensive institutional framework to enable private sector participation in the process as well as consolidation of information for future referencing.