Kenya flower industry resilient
Double taxation is discouraging new investors eyeing flower industry, making many growers venture into Ethiopia where cost of production has been reduced, Kenya Flower Council said.
Despite the higher costs due to multiplicity and duplication of taxes by the county governments, KFC said, no grower has fully relocated to Ethiopia. KFC chief executive Jane Ngige said in a media briefing session, that the five major investors who are alleged to have relocated to Ethiopia, Uganda and Zimbabwe late last year still have active operations in the country.
“These investors did not close their operations here. They only expanded to countries which have growth prospects,” she said in a media briefing, flanked by officials from Brand Kenya, Horticulture Crops Directorate, Kenya Plant Health Inspectorate Services and the International Floriculture Trade Expo.
The organisations have come together to address challenges to protect Kenya’s huge market share in the multibillion-global flower market.
This follows growing competition, mainly by the fast growing Ethiopian flower industry that enjoys heavy subsidies from the government, stoking fears that it could overtake Kenya in both production and exports.
Kenya has sustained the lead in the exports of cut-flowers in the global market for decades.
Kenya National Bureau of Statistics data shows cut-flowers exports reached 122,825.25 metric tonnes in 2015 from 114,763.78MT in 2014.
Ethiopia has many tax incentives to encourage investors following a discovery that it has a good climate to grow flowers.
