United Kingdom now third biggest buyer of Kenyan goods

Workers at Molo River flower farm in Rongai, Nakuru. FILE PHOTO | NMG 

By CONSTANT MUNDA
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Summary

• Earnings from exports to the UK increased 12.22 percent in the first quarter of the year to Sh13.29 billion compared to a similar period in 2019, according to the Kenya National Bureau of Statistics (KNBS) data.
• The UK, which buys about 19 percent of Kenya’s cut flowers, is also a major destination for farm produce such as tea, vegetables and fruits.
• Overall, Kenya’s exports rose 14 percent year-on-year to Sh179.8 billion against a 0.4 percent rise in imports to Sh426.4 billion in the first three months of the year, helping narrow the country’s goods trade deficit by 7.5 percent to Sh246.6 billion.

The United Kingdom has overtaken the Netherlands and the US to become the third biggest buyer of Kenyan goods, latest official data shows, in the wake of coronavirus-induced lockdowns and international travel restrictions.

Earnings from exports to the UK increased 12.22 percent in the first quarter of the year to Sh13.29 billion compared to a similar period in 2019, according to the Kenya National Bureau of Statistics (KNBS) data.

The growth, the KNBS says, is largely attributed increased orders of cut flowers by Kenya’s former colonial master, helping London move from fifth to third largest importer of the country’s merchandise.

Exports to the Netherlands, Kenya’s top cut flower destination, contracted 9.08 percent to Sh13.15 billion, pushing Amsterdam to fourth from second spot in the list of Kenya’s top global buyers.

The Kenya Flower Council, a lobby for large-scale flower farms, said the UK left its skies open longer than the Netherlands, which has in recent years been Kenya’s largest market in Europe and second globally after

Uganda.

“We now have better freight into the UK than the Netherlands. Even when we were in the heat of Covid shocks about two months ago, the UK remained open,” KFC chief executive Clement Tulezi said on the phone.

“That’s why you saw we had an initiative called Flowers of Hope into the UK and not the Netherlands, which had logistical challenges.”

Under the ‘Flowers of Hope campaign by KFC and the Kenya Private Sector Alliance (Kepsa), Kenya donated bouquets to UK’s health workers battling Covid-19.

Local farms handed similar flower donations to workers at the Kenyatta National Hospital, Mbagathi Hospital, Pumwani Maternity, Mama Lucy Hospital and National Spinal Injury Hospital.

The UK, which buys about 19 percent of Kenya’s cut flowers, is also a major destination for farm produce such as tea, vegetables and fruits.

Land-locked Uganda remains the country’s largest market with merchandise valued at Sh18.88 billion in the first three months of the year, the official data indicates, a growth of 15.6 percent compared with the first quarter of 2019.

Earnings from goods ordered by Pakistan, predominantly tea, went up a modest 3.16 percent to Sh13.47 billion, pushing the Asian country up one spot to replace the Netherlands as the second biggest market in the first half of 2020.

Sales to the United Arab Emirates (UAE), however, grew at the fastest pace among top buyers of Kenyan goods at 24.02 percent to Sh12.88 billion, largely because of increased orders for tea, the KNBS said.

The data shows exports to the US – largely textiles and apparel under quota- and duty-free African Growth and Opportunity Act (Agoa) – were largely flat at Sh12.16 billion, a marginal 0.41 percent drop compared with Sh12.21 billion a year ago.

Overall, Kenya’s exports rose 14 percent year-on-year to Sh179.8 billion against a 0.4 percent rise in imports to Sh426.4 billion in the first three months of the year, helping narrow the country’s goods trade deficit by 7.5 percent to Sh246.6 billion.

A persistently higher trade deficit, economists say, slows down creation of new job opportunities for the growing number of skilled youth as most revenue earned within Kenya is spent on buying goods from foreign factories, thereby raising production and job openings in major source markets such as China and India.

Kenya has struggled to diversify her exports away from the traditional tea, horticulture and coffee, which are largely sold raw, exposing its farmers to price shocks in international markets.