Kenya and the Netherlands sign framework of cooperation to diversify transport of perishables using sea freight

Kenya, through Kenya Flower Council and the Embassy of the Kingdom of the Netherlands, signed a framework of cooperation, which is set to strengthen the efforts in adoption of sea freight for perishables in Kenya. The signing took place at the International Floriculture Trade Exhibition (IFTEX) at Oshwal Community Center in Nairobi, Kenya, bringing together stakeholders in the floriculture sub-sector such as growers, breeders, regulators, buyers, partners, among others

Signing of Framework of Cooperation between Kenya and the Netherlands

Export of Kenyan flowers to Europe in the wake of Covid-19

Flowers are the major export products from Kenya, accounting for 70% in foreign exchange earnings from Horticulture sector, with volumes of cut flowers exported in 2020 increasing by 17% to 210 million tonnes in 2021. The value grew from Ksh 107 billion -Ksh 110 billion by 2021, going to show how important this sub-sector is.

Speaking during signing on the framework, Mr. Richard Fernandes, Chairman of the Kenya Flower Council (KFC), noted that despite the effects of Covid-19, the industry remains one of the largest employers providing employment to approximately 200,000 people directly and many more indirectly. KFC plays a leading role by supporting Kenyan growers and exporters in complying to global sustainability standards. The KFC silver is recognized as the only three internationally benchmark standards set by the EU Base on Floriculture Sustainability Initiative.

In the wake of Covid-19, limited passenger air travel saw flights converted to cargo freights in a bid to cushion the airlines. Transport has become alarmingly more expensive, accounting for almost 50% of horticulture export costs, and are domiciled in freight charges. Therefore there is a need to rethink how we do business and to discuss how the sector can position itself as profit margins shrink.

Impact of the framework on trade sustainability

The framework provides an opportunity for players to explore alternative freight options, given the growing cost and carbon foot print that air freight has. Adoption of sea freight is expected to be a milestone towards a more sustainable sector geared towards reduction of the carbon footprint which contributes to climate change.

Mr. Maarten Brouwer, Ambassador of the Embassy of the Kingdom of the Netherlands in Nairobi, noted that the cooperation was emphasized during the visit to Kenya in April 2022 by Minister for International Trade and Development Cooperation Ms. Liesje Schreinemacher, who together with Cabinet Secretary of Transport James Macharia signed a Letter of Intent on the shared ambition to improve the connection of ports through a 'Cool Logistics Corridor'. He added that, by combining both transport systems (namely air and sea), Kenya would be well-positioned to become the East-African hub for perishables and ready for the future.

Sea freight also opens up new markets for Kenya. Bigger capacity and lower freight costs could increase sales to Middle and Far East. It is however important to incorporate the supply chain requirements of perishable goods in new infrastructures, for instance, Standard Gauge Railway (SGR), ports, container depots as well as realizing efficient customs clearance procedures of perishable goods leaving Kenya. 

From left to right: Clement Tulezi, Ingrid Korving, CAS Hon. David Osiany, Amb. Maarten Brouwer, Anke Robertus

As the countries position themselves for this transition, there is a lot to gain from further  developing the Kenyan sea freight capacity. According to key note speaker Hon. David Osiany, Chief Administrative Secretary for the Ministry of Industrialization, Trade & Enterprise Development: “Investments done by the Government of Kenya in port and inland networks provide opportunities for cooling logistics infrastructure, which supports adoption of agricultural exports to sea freight. The Netherlands has the technical expertise in this area and looks forward to working together with Kenya in the development of the cold logistic chains for sustainable trade.”

Importance of stakeholder collaboration

For the framework to effectively work, stakeholders must constantly engage to understand changes within the freight space and how they can work to accommodate each other. For instance, Phytosanitary services are a key component in the horticulture space. Speaking during the signing, Dr. Isaac Macharia, Director of Phytosanitary services, Kenya Plant Health Inspectorate Service (KEPHIS), noted that 38-48% of flowers are exported to EU countries. KEPHIS has put in place measures to mitigate challenges that face the export of flowers. "These measures aim towards exporting produce free of pests and diseases, such as  the False Coddling Moth (FCM), which is a quarantine pest in the European Union. We are aligned to adoption of sea freight and have the capacity to support stakeholders,” according to Dr. Macharia. This statement was echoed by Mrs. Ann Gikonyo; Deputy Director of Market Research and Product Development at the Horticultural Crops Directorate.

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