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Agricultural Policy in Kenya: Issues and Processes

A paper for the Future Agricultures Consortium workshop,
Institute of Development Studies, 20-22 March 2006

by

Patrick O
...
O
...
atieno@kenyaweb
...


Contents
Page
Acronyms and Abbreviations

2

1
...
Key Policy Issues
Key Policy Concerns
Possible Concerns
Consistency with SRA priorities

3

3
...
Sufficiency of Structures and Processes to Implement SRA

33

5
...
Appendix

38

7
...
Introduction
Agriculture remains the backbone of the Kenyan economy
...
Over 80% of the
Kenyan population live in the rural areas and derive their livelihoods, directly or
indirectly from agriculture
...
The development of
agriculture is also important for poverty reduction since most of the vulnerable groups
like pastoralists, the landless, and subsistence farmers, also depend on agriculture as their
main source of livelihoods
...
The development of the
sector is therefore important for the development of the economy as a whole
...
Trends in the
growth rates for agriculture, GDP and employment, show that the declining trend
experienced in the sector’s growth especially in the 1990s, is reflected in the declines in
employment and GDP as a whole (fig
...
in Appendix)
...


Policies for agriculture consist of government decisions that influence the level and
stability of input and output prices, public investments affecting agricultural
production, costs and revenues and allocation of resources
...
Improved agricultural production has been
seen as one of the overall objectives for poverty reduction in the country
...

Due to limited availability of high potential land, it has been envisaged that increasing
agricultural production will have to come from intensification of production through
increased use of improved inputs, diversification especially from low to high value
crops, commercialisation of smallholder agriculture, and increased value addition
through stronger linkages with other sectors
...

2
...
The key areas of policy concern, therefore, include:
•
•
•

Increasing agricultural productivity and incomes, especially for small-holder
farmers
...

Encouraging diversification into non-traditional agricultural commodities and
value addition to reduce vulnerability
...

Encouraging private-sector-led development of the sector
...


Key policy concerns
i
...
The performance of agriculture, which
remains the backbone of the economy slackened dramatically over the post
independence years from an average of 4
...
This decline culminated in a negative growth rate of -2
...
As
a sector that engages about 75% of the country’s labour force, such a decline
implies lower levels of employment, incomes and more importantly, food
insecurity for a vast majority of rural Kenyans
...
A decline in agriculture
has thus far reaching implications in terms of employment and income inequality
as well as food security for the country (UNDP 2002)
...
This was mainly because the
decline in agriculture’s performance since the mid 1980s was not matched with
any real transformation in the economy which would have ensured that the share
of other sectors in GDP and employment increased as agriculture’s share declined
(ILO 1999)
...


•

It is recognised that low productivity, reflected in low yields per acre of land is
among the main sources of high unit production costs in agriculture in Kenya
...
The objective of policy makers in this
area, therefore, is to increase output using improved technologies of farming,
which would inevitably increase farm productivity and hence farmers incomes
...
The SRA (2004-2014)
recognises this and that to improve smallholder farm productivity as well as
increase incomes, smallholder farming must be changed from producing for
subsistence to commercial profitable businesses
...
When agriculture is technology-led,
not only is food security achievable but also poverty alleviation is also possible
...


4

•

ii
...
The major marketing constraints comprise high
transportation costs due to dilapidated roads, improper handling, poor storage
facilities and wastage
...
For livestock marketing, limited cattle holding grounds and meddling
with stock-routes has limited access to markets
...
The two sets of interventions, in enhancing agricultural
productivity and marketing systems as recognized too by the SRA (2004-2014)
will lead to agricultural growth
...
Only about 17% of the country’s land is high and medium potential
agricultural land where most intensive crop and dairy production take place
...
This means that
increasing agricultural production will have to come from intensification of land
use in the high and medium potential lands
...
There is low utilisation of irrigation
potential with only less than 7% of the cropped land under irrigation 1
...
This spills over to negatively affect agricultural
incomes and hence investments in rural areas
...
The current
ravaging drought is a stark reminder to this
...
Recurrent droughts, floods and the associated losses are
concerns that have featured much in public debate in the recent past
...
Despite the enormous potential for irrigation, irrigation
based farming is not widely practiced
...
This has been due to low utilisation of
water, lack of efficient technologies, destruction of rainfall catchment areas, poor
management of government irrigation schemes, degradation of surface water,
uncontrolled exploitation of underground water, leading to a drop in the water
table and increase of water extraction costs, sluggishness in permit allocation for
use of water, the lop sided Nile Treaty among others
...


5

irrigation is important in increasing arable land, productivity per acre of land,
stability of agricultural output during adverse weather conditions and stemming
famines achievable only with addressing factors that hinder irrigation efforts
...


Limited diversification of Agricultural production: Narrow base of agricultural
products, especially exports leads to high vulnerability of incomes to the
international market trends
...
Only a few commodities (coffee, tea, dairy, maize, wheat, beef, and
horticulture provide livelihood for over 85% of the population while coffee and
tea alone provide 45% of the wage employment in the sector
...


•

Primary agro-based products constitute about 51% of the country’s total exports,
with the value of exports from agricultural sector accounting for 64% of total
exports (Kenya 2003)a
...
This is mainly
due to limited diversification, and low value addition in agricultural exports
...


•

Kenya has not exploited its agricultural potential to the full which is necessary to
diversify into no-traditional commodities
...
The country has varied climatic conditions suitable for diversified
agriculture into specialised niches like horticulture, herbs, spices, fruits and even
lean beef, but which have not been exploited to the fullest despite very good
efforts made in horticulture and fruits
...
The inability to effectively monitor and enforce compliance
and rules governing offshore territorial waters has curtailed full exploitation of the
offshore fishing potential
...


•

Produce from agriculture is commonly marketed with minimal processing
resulting in low revenue earning capacity to farmers, fishermen and creation of
fewer employment opportunities for citizens
...
Some of these measures recognized by SRA (2004-2014)
include, provision of appropriate incentives for establishing agro-industries in
rural areas; focused research on value addition regarding processing, storage and
packing of agricultural produce; promotion of partnerships between smallholders
and agribusiness; improvement of supportive infrastructure, e
...
, rural access
roads, rural electrification, water and telecommunications; and undertake training

6

for farmers and farmer institutions in value addition among others
...

•

iv
...


There is also limited exploitation of the regional market potential
...
g
...
, and trade liberalisation are yet to be exploited to a significant
level
...
Furthermore, the country
can become a regional hub for exports to the opened up markets through regional
integration and trade liberalisation to the Far East as well
...
The performance of the sector is affected right from the
production to marketing domestically and even internationally
...
Poor infrastructure has also contributed
to the poor market integration in the country
...
Some of
these include provision and maintenance of rural access roads to facilitate the
movement of agricultural produce to markets, establishment of agro-based
industries to increase the value of agricultural produce, education, training and
extension services to enhance the adoption of modern farming techniques,
establishment of local market centres to open up markets for farmers produce,
rural electrification to facilitate agro-processing and safe storage for the produce
...

Inadequate and declining research in agriculture: During the first decade of
independence, agricultural research emphasised cash crops and major food crops
led to major break throughs in these commodities, which largely contributed to
increased agricultural production
...
Productivity from small
scale farms has therefore been lower than from the large scale farms
...
Training for agricultural extension staff also expanded
...

The decline in government allocation to the sector has contributed to this
continuing trend
...
High costs have led to inadequate application of improved
purchased inputs on most of the farms
...
The research system in place for agriculture also
faces a number of problems like lack of strong research-extension-farmer
linkages, inadequate funding, and high turnover of research scientists due to poor
incentives
...
Institutional
failure due to lack of capacity by the private sector to take over the functions
previously performed by the state after liberalisation of the sector
...


•

A number of constraints have however hindered further progress in research
...
The
ability of Kenyan agriculture to play its role in the economy depends on the
research agenda that the country charts out for its national agricultural research
system
...
Although agricultural research is currently
coordinated by Kenya Agricultural Institute (KARI), a critical problem is
availability of research funds
...


vi
...
The lack of finance for
agriculture limits increasing production and investment in value addition activities
in agriculture
...
Agricultural credit
available to farmers has tended to diminish over time since independence
...

Thus to improve agricultural productivity and incomes, especially of smallholders
most of whom reside in rural areas, access to affordable financial credit is
important to enable them acquire new farming technology - a necessary input in
realising the higher productivity goal
...


There has been a bias of credit towards large farms and cash enterprises
...

Limited development and exploitation of the livestock sector
...
Kenya’s livestock sector contributes 10% to the GDP and about 42%
of total agricultural output (Republic of Kenya 2002)
...
The sector also earns
foreign exchange through the export of live animals, hides and skins, dairy
products and processed pork products besides providing raw materials for agrobased industries
...
Although
livestock keeping is commonly practiced through out Kenya, more than 60% of all
Kenya’s livestock is found in the ASAL where it employs 90% of the local
population
...


•

The development of the livestock sector is however constrained by a number of
factors
...
This, coupled with lack of
reliable markets has seriously undermined efforts to realise the full development
potential of the sector
...
The
marketing problem has been aggravated by the poor state of infrastructure, which
increases the marketing costs
...
The withdrawal of government subsidies as part of
economic reforms meant that many farmers became unable to afford such
services, leading to reduction in their use
...
This has led to the problem of poor quality livestock through
problems of inbreeding and limited use of improved inputs
...

The high potential for exports from livestock and livestock products remains
unexploited due to inadequate capacity in standardisation and quality control as
well as inadequate processing capacity
...
The
shortage of high quality breeding stock acts as a further constraint to the
exploitation of exports from the livestock sector
...


•

9

•

•

•
•

viii
...
This has meant that
alternative management systems for livestock production have to be adopted
...
Inadequate water facilities, poor marketing
infrastructure and poor animal husbandry practices as well as poor slaughtering
practices limits the quality of hides for exports
...
Milk marketing was liberalised in 1992, leading to the proliferation in
the market of private processors and informal traders/hawkers of raw milk
...
The
production and marketing of beef products has been affected mainly by the
collapse of the KMC
...
Poor
timing of livestock sales, with majority of pastoralists selling their stock under
very desperate circumstances, is another problem
...

The revitalisation of the livestock sector will therefore require among other things,
the rehabilitation of marketing infrastructure facilities, facilitating the private
sector to invest in both primary and secondary livestock processing plants close to
production areas
...
Reviving
and privatising the KMC to provide a market outlet for livestock will also
contribute to reducing the vulnerability of livestock farmers especially pastoralists
whose livelihoods depend on livestock
...

Lack of a comprehensive land use policy: This has over time led to difficulties of
access and utilisation of land
...
Land is an important resource in agriculture in Kenya and lack of
access to or ownership of land is considered one of the major causes of poverty
(UNDP 2002)
...
Only less than 20% of the country’s land surface is high and
medium potential
...

Issues on land that are relevant to agricultural development include conflicts
between different land uses due to the lack of a coordinating body that can ensure
harmony between different users (Kenya 1994)
...

The failure by the existing land conservation policy and the need to have attendant
laws to generate environmentally sound land use habits for sustainable
10

•
•

development is a relevant concern for agriculture
...
This is compounded by
the lack of a well coordinated land management policy with respect to various
land uses
...

The lack of accurate and up to date database information on land is also a critical
issue
...

The problems of pastoral land tenure relations, with its roots in the dispossession
of pastoral communities of their lands by the colonial administration, has
implications for agricultural development especially food security and
sustainability
...
There is therefore need to provide a legal framework that
defines and recognises pastoral land and related natural resource rights
...


Possible Policy Concerns
• Maize is the main staple commodity in the country and therefore important for
food security
...
The majority of
Kenyans are food insecure due to inadequate strategic reserves in major food
commodities, and lack of proper distribution systems that can facilitate the
efficient movement of food commodities from surplus to deficit areas
...
The main cause of shortfalls especially in maize has over
time resulted from the low use of fertilisers, lack of finance and the withdrawal of
other services like extension by the government
...
The incidence and prevalence of food
insecurity, however, is greatest in the arid and semi-arid lands (ASALs) due to
poor resource endowment and scanty and unpredictable rainfall patterns
...
This has
compounded the problem of food security in the ASALs
...
It is not easy to reconcile that in a country where agriculture is the
mainstay of the economy, famine is so frequent
...
These include,
famine brought about by drought, floods and rapid deforestation
...
Further, poor logistics worsen famine
management even with bumper harvests in the food basket regions of the country
particularly the north rift
...
Famine amidst plenty reflects generally on the country’s state of
unpreparedness in the face of a disaster
...


•

Increasing importance of small scale agriculture in the sector, coupled with its
declining productivity and low incomes are a concern especially relevant to
poverty reduction efforts
...
Food production also
accounts for a major share of small scale agricultural production (Republic of
Kenya 1999)
...
This is because of the high poverty levels in the rural areas
especially among smallholder subsistence farmers
...
Women provide 75%
of the labour force in small scale agriculture and manage 40% of the small scale
farms
...
Despite women’s significant contribution to agriculture, they face a
number of constraints, especially limited access to productive resources like
improved inputs, extension, and marketing facilities which limit their productivity
...
The
expansion of rural investments like infrastructure is likely to have more beneficial
effect on women, the majority of whom are among the
...
These disparities have meant that poverty levels have continued to
be higher in the rural areas where the majority of the population reside
...
As agricultural land continues to be scarce, and rural
poverty continues to increase, agricultural practices that conflict with the
12

environment have increased
...
The poor engage in farming practices that negatively
affect the environment and reduce the potential for ASALs
...
Low productivity, with pressure on the
natural resource base has led to migration into Arid and Semi Arid Lands
(ASALs) with inappropriate farming practices and negative environmental
consequences
...
But even in these regions, most of the activities
people engage in are agricultural
...

Consistency of policy concerns with SRA priorities
The key policy concerns discussed so far are to a large extent consistent with SRA
priorities
...
The primary objective of the strategy is to provide a
policy and institutional environment that is conducive to increasing agricultural
productivity, promoting investment, and encouraging private sector involvement in
agricultural enterprises and agribusiness
...
Among the objectives of the institutional
reform agenda set out in the SRA are: increasing productivity to lower per unit costs
of production, improve the extension service system, improve the link between
research, extension and the farmer, improve access to financial services, encourage
growth of agribusiness, reduce taxation of agriculture, increase market orientation and
improve the regulatory framework
...
These are
the areas of concern for the development of agricultural sector in terms of boosting
productivity and incomes, and ensuring food security, irrigation farming and
enhancing diversification into non-traditional commodities
...
These include the Poverty Eradication Commission
(PEC), the Poverty Reduction Strategies Paper (PRSP) and Economic Recovery
Strategy (ERS), with all emphasising agriculture as the main sector both for poverty
reduction and economic development
...
It thus has to be marketed aggressively so that stakeholders can buy it
and take ownership of the various measures that it prescribes to revitalise agriculture
...
This is another major oversight of the policy document and ought to be
thought out and formalised
...
Some of that
manpower could be lacking in skills required for the successful implementation of the
SRA
...
This could bring about haphazard and inconsistent implementation
of the policy framework and deny the economy of the benefits envisaged from it
...
Agriculture grew at an
average rate of 4
...
4% in 2000
(Kenya 2001)
...
It
has been argued that despite agricultural sector’s importance in GDP, the sector’s
performance is dominated by a few cash crops, concentrated in the high potential
areas
...
Hence positive growth in the sector even during the first decade did
not lead to a reduction in poverty 2
...
Especially important is the extent to
which it is participatory and encourages participatory policy processes
...

The SRA nonetheless also recognises efforts from other sectors that are necessary to
achieve its objects for example in having the right and stable macroeconomic
environment, supportive services in policy analysis and research, affordable financial
services, good roads especially rural access roads, rural electrification, water supply,
accessible and affordable curative and preventive health care and seeking to have the
resources and techniques to increase farmland under irrigation
...
These
devolved funds are creating rural infrastructure that without them would not have
been undertaken at all
...
In addition they also open up
markets for farmers whose produce would reach destination markets with difficulty
and at higher costs
...


14

3
...
In an effort to discuss the structures and actors in
agricultural policy, we present a summary and discussion of two studies that have
attempted to identify the main players and policy making processes
...
The overriding purpose is an analysis of drivers of change in Kenya
...
The resulting consequences have been that “corruption has flourished,
public institutions have declined, growth has faltered and poverty has worsened” (p6)
Elite Attitude to Change and Prospects
In regard to attitude to change the report laments that the very same political elite
benefiting from the status quo have generally opposed desirable patterns of change
...
This somewhat complacent position
is seemingly based on the view that “better prospects for pro-poor change” were
created by the election of the NARC government in 2002
...

Analysis Framework and Approach
The study, in terms of methodology, applied the “Drivers of Change” approach
adopted by DFID as an analytical tool notably in Zambia, Nigeria and Asian
Countries to understand processes of change at the country level
...

On the premise that critical obstacles to bringing about change lie in the realm of
political economy and governance the study for the most part relies on political
economy analytical framework
...
The
rationale for the framework is on the one hand to highlight the plight of the poor and
argue for pro-poor change
...
The form taken by these
forces depends on the nature of incentives and restraints resulting from changes
emanating from social, economic, political and institutional processes which keep
altering the context for policy making
...
The various actors the report identifies and processes
discussed are set out in a table (p7) as follows:
Table 1: The relationship of drivers of change considered
Contextual Factors
Institutions
Globalization, trade and Political process
investment
Public administration
Regional influences and The rule of law
integration
Land rights
Demographic change
Ethnicity
Urbanization
Gender
Deteriorating
infrastructure
The rise of the informal
sector
Changing rural livelihood
Human development
HIV/AIDS

Agents of Change
The political elite
Civil servants
Parliamentarians
Political parties
Local government
The judiciary
The military
Civil society organizations
Trade unions
Academic
and
policy
research units
Faith groups
The media
The private sector
Donors

To summarize, three types of drivers identified that may drive or block pro-poor
change are categorized as follows:
i)
ii)
iii)

Long-term process of social and economic change-referred to as
contextual factors, globalization, urbanization, human development
etc
...

Reform minded organizations and individuals – referred to as agents of
change notably the political elite, parliamentarians, political parties,
etc
...
The listing could have been more analytical taking
into account the fact that policies are relevant to drivers of change to different degrees
depending on the particular issues at stake
...

A case in point is agriculture policy affecting virtually all the actors since agriculture
is the dominant sector in the economy and the majority of the poor live in the rural
areas and struggle to earn a living from agriculture
...
Furthermore, certain policies are of immediate and direct consequences
16

in improving conditions of the poor, for example land tenure reform leading to
landless poor having access to or owning land for agricultural production to satisfy a
critical basic need food
...
Rather, analysis
should be directed towards specific drivers of change for whom issues/problems in
agriculture policy area/sector, for example, are of relevance and will therefore
participate in that policy process
...
They may of
course participate in the policy process for other areas but this invariably will be to a
lesser degree depending on the nature and extent of relevance of the policy issues
...
The
implication is a revision of the drivers of change listing to bring out key factors and
various actors in the agricultural policy process
...
At the same time, as individual actors
in the policy process they are also top of the list of agents of change in agriculture
...
The argument in a nutshell is that there will be varying
configuration of actors for different policies even the various pro-poor policies
...
This could have logically limited the scope of actors relevant to this
agricultural policy process considered
...
In the case of contextual
factors there is a glaring omission of fundamentally important factors some of which
have actually been referred to peripherally as exogenous shock, for example drought
(p8)
...
Post independence
Kenyan policies especially for agriculture, and specifically land, have roots in the
colonial settler economy
...
The implication is to take into account the historical dimension and
consider historically derived policies/acts as contextual factors
...

In relation to demographic issues critical concerns comprise first the fact that poor
family households are large and those in the rural areas either have no land or the land
has been subdivided into units that are no longer economically viable
...
Thirdly, population settlement has virtually followed

17

geographically suitable zones for crops and livestock under rainfed agricultural
production
...

The deterioration of infrastructure has increasingly become a major hindrance to
development initiative in Kenya generally and is indeed turning out to be a major
stumbling block to pro-poor change
...
A key concern in this regard is expansion and proper maintenance of
various modes of transport and communication for adequate coverage of the rural
areas
...
At the same time the report correctly
points out the rise of the informal sector is an indication of failed development
...
Al
...
As a contextual factor in addressing
pro-poor change, it is necessary to go beyond the now familiar general policy
prescriptions of improving access to credit, regulatory requirements, business and
skills development, etc
...
Secondly, the location of enterprises, mostly in the rural
areas and the key role played by agriculture, both commercial and subsistence
agriculture
...
These issues taken into account
are pointers to the fundamental contribution of sound agricultural policy and
development in the rise of the informal sector
...
A direct link could be made
between the livelihoods discussion raising issues of increasing inequality,
landlessness, falling food production, HIV/AIDs pandemic etc to human
development, in the broader context of human capital development
...
Also to be taken into
account is the important dimension of social capital formation closely related to
access to credit and kinship community organization for participation in the
agricultural development process
...
It is
important to point out in relation to female-headed households being poor that a

18

sizeable proportion are in subsistence agriculture in which most rural poor are found
and is the only way of life known to them
...

It is decried that Millennium Development Goals (MDGs) as pointers to poverty
reduction efforts face grim prospect that they will not as a whole be realized in the
foreseeable future
...
The key problem areas in effecting pro-poor change leading to
meeting these goals are well recognized by the Kenya government in her policies on
issues of broad-based economic growth, access to markets, services and assets,
political and social empowerment, etc as the report explicitly states (p9)
...

There is definite truth in growth decline in recent years for the whole economy and
particularly, the agricultural sector overall
...
All is therefore not lost or erased, what is of grave concern is that there has
been increasing inequality
...


Political context of Agriculture Policy making
The report while expressing optimism regarding policy reform with the installation of
the NARC government in 2002 at the same time had deep rooted reservations
...
Secondly, the report surmised
that political elite could revert to “previous behaviour” with adverse consequences for
growth and poverty reduction
...
The reality unfolding has revealed that it
is the reservations that actually contained valid predictions
...
The initial claims that
contradictory public pronouncements on policy by ministers and senior civil servants
were due to a different style of leadership and administration, compared disparagingly
to Moi regime, that delegates actual authority to ministers has been proved false
...
The implication of this very fluid trend for policy is
ever changing power sharing arrangements yielding unstable political alliances that is
also transforming the political landscape of patron-clientelism
...

This implies some knowledge of the reforms and also a certain measure of political
will but not necessarily a complete understanding of change especially those that were
imposed
...

It can therefore be said generally that the political elite at the minimum are aware of
the changes, they should know of most of them but not necessarily have a full
understanding
...

The politics of the agricultural sector and indeed most sectors of the Kenyan economy
are greatly influenced by patronage revolving around the presidency and his cabinet
...
The analysis of drivers of change however puts
emphasis on political elite apparently viewed as a homogenous entity and considered
the crucial determinants of change in a patron-clientalist framework
...
The agriculture sector policy is a good example where there are
diverse interests among various policy actors based on geographical climate regions
which determine agricultural commodity produce and marketing and also coincides
with ethnic origins
...
It needs to be
emphasised in this connection that the political elite acts in alliance with economic
and social elite and not in isolation
...
A
significant indication of this trend is cooptation of former KANU regime key players
and power brokers in the agricultural process into the NARC regime
...

What shapes the policy environment?
The paper by Smith and Karuga (2004), reports on the study commissioned by the UK
Department for International Development (DfID)
...
A number of factors are
identified as shaping policy in the sector
...

i
...
This has been the case for all the
three regimes, from the Kenyatta, through Moi and now Kibaki NARC regime
...
Kenya’s political system, with the concentration of power in the
presidency, determines how policy is made
...
The directives have to be implemented and if not earlier
budgeted for, have to be fitted somewhat in the existing budgetary framework (Smith
and Karuga 2004)
...
It has been argued by some that these
productions have over the years been associated with particular ethnic groups
...

Rent in the agricultural sector is created by artificial shortages through licensing and
restrictions applied to the production and marketing of agricultural commodities,
inputs and services
...
This mainly explains the reason why the heavy regulatory framework and
government involvement with almost all agricultural legislation is maintained
...

Smith and Karuga (2004) argue that this relationship between ethnicity and
agricultural practices has shaped agricultural policy to a large extent whereby policy
formulation processes at times have tended to be influenced in favour of and/or
neglected given products apparently to favour or otherwise penalise given ethnic
groups
...
This is essentially
attributed to historical factors underlying cash crop production for export
...

It is however important to observe that other factors apart from the patrimonial state
have played a significant role in influencing agricultural policy
...
Coffee is a case
in point where conditions in the international coffee market and weather conditions in
Brazil have influenced the benefits of Kenya coffee farmers
...

One of the main arguments put forward by the proponents of agricultural marketing
reforms in the late 1970s, was that agricultural sector was overly penalised especially
through the domestic marketing system, to the extent that agricultural exports suffered
from negative net protection
...
Biased
agricultural development policies also emphasised only high potential areas, at the
neglect of low potential and marginal areas
...
These
forces have over time led to concentration of economic activities in some areas

21

compared to others
...
The
nature of policies pursued and implemented overtime is a major factor in this regard
...
This has resulted in wide regional differences in access to
infrastructure and certain agricultural services (UNDP 2002)
...
Little incentives have existed for the Kenyan political elite to listen to the
poor
...
The result of this has been that rents have been extracted
regressively from the poor directly through lower farm-gate prices for their produce,
higher prices for food and inputs and indirectly through lower wages and/or rent for
land
...
The first
phase of the Kenyatta regime displayed signs of genuine interest in farming and the
success of it, all embodied in the vision to reduce poverty, ignorance and disease
...
Land settlement
schemes and tenure policies resulted in notable success in this phase
...
The initiatives made to evolve agricultural policy
during this period were demand driven responding to local stakeholder needs
...
Nevertheless, the emphasis on import
substitution industrialisation strategy adopted over the period to the mid 1980s,
undermined the sustainability of achievements realised in agriculture during the first
decade of political independence
...
The over
protection of industry also penalised agriculture through negative terms of trade
between agriculture and other sectors
...
The
penalisation of agricultural exports, together with the protection for import substitutes
that failed to lead to increased domestic efficiency in production, were some of the
main arguments for structural adjustments programmes initiated in the late 1970s
...
These
include the end of easy options like no breakthroughs in agricultural research like
high yielding varieties, no room for further subdivision of large scale farms, decline in

22

provision of extension services and inputs and the decline in donor support for
targeted agricultural programmes
...
10
of 1965 was to revolutionise agriculture through provision of extension services,
training, and introduction of modern farming techniques
...

A number of special development programmes, were initiated largely with donor
support to enhance the development of agriculture and the rural areas in general
...
These include the insufficient attention to involve the stakeholders
and lack of coordination among different actors
...

In the mid 1970s and 1980s Smith and Karuga (2004) argues, considerable donor driven interventions influenced policy
...
Donors also invested substantially in rural infrastructure, like rural
access roads, storage facilities, production and marketing facilities like sugar and
coffee
...
The structural
adjustment programs (SAPs) of the 1980s for the agricultural sector focused on
market liberalization and price decontrols, which were expected to reduce
opportunities for rent extraction through the marketing chain by the elite
...
It created
mistrust and the highest level of misunderstanding between the government and
donors and represents the area where the gap between policy formulation and
implementation was widest
...

The next phase of the 1990s was one of historic reduction of donor funding labelled
by some the “donor-do-nothing phase”
...
At any rate,
considerable policy related activities in the agricultural sector such as price decontrol,
market liberalization and trade policies were undertaken during this time
...
In the same year,
the government and a joint donor group began an ambitious reform agenda in the
agricultural sector to establish an agriculture sector investment program (ASIP) - a
holistic financial and operational sector support policy
...
However, the
unfavourable economic and political environment in which the ASIP was initiated
resulted in failure and poor outcomes
...
First lesson learnt was that it is extremely
important to cultivate local ownership and commitment to policy reforms or else they
fail
...
Second local factors
like the political economy that could have been crucial for the successful
implementation of the proposed policy reforms were neglected, downplayed and
ignored
...
They often thought that by talking to the government they had
gained this access only to dawn later on them that they were in deed talking to
individuals without influence in policy formulation, a fact that is typical of
patrimonial states
...

ii
...
On that basis, five plausible forms of policy
initiation and formulation process can be distinguished
...

At the bureaucratic level, like at the directorate or permanent secretary level, a
number of policies are initiated, formulated and approved by the minister
...
Interministerial co-ordination at the permanent secretary (PS) level with adequate
consolations with the Treasury for the allocation of funds for their implementation
predominated
...
There are also some important
policy decisions initiated by the bureaucrats but which need them to write a cabinet
paper for their approval
...

Some policy decisions are executive presidential directives with the role of the
technocrats being to accommodate them within the resource envelope and
methodology of implementation
...
The bureaucracy thus simply rubber stamps the directives
...
The budget represents a summary of presentations made by ministries as to
the programs and projects for funding in the evolving fiscal year
...
They are usually likely to be implemented because
they have resource allocations attached for their implementation
...


24

Policy decisions affecting agriculture are also made during the budget preparation
process
...
The
ministry of agriculture (MOA) has to make policy decisions it perceives can best
enable it achieve its objectives, not only annually but also in the medium term that
captures two outer fiscal years
...
The budget making process also provides for sector
hearings giving an opportunity to the other sectors whose decisions may have some
impact on agriculture to also contribute to its decision-making within it
...
The Ministry of Finance is therefore crucial in the
realisation and implementation of policies
...
Such is the case of the
development planning process
...
This is
also the case with the sessional papers or documents arising from task forces
...

The long history of foreign aid to Kenya has meant that there are policy initiatives
that are typically donor driven
...

Significantly, there are some that are taken over by government and resources
deployed for maintenance
...
The bureaucrat’s role has diminished increasingly after 1985 with policy
decisions being shaped more by the executive’s views instead
...
These
executive declarations have persisted and traversed the three post independence
political regimes
...
The circle formulating policy has been limited in size, concentrated in
the ministry of finance (MOF) and the Central Bank of Kenya (CBK)
...
The MOA
technocrats consider their inputs ignored by MOF since their budget submissions
detailing priorities for the ministry get reordered without consulting with them
...
O’brien and Ryan (2001) however note that economic policy
formulation group, within the policy formulation circle of the CBK and the Finance

25

ministry has been small with controlled internal discussions
...
Another reason given is the desire by the core policy makers to
prevent potential losers from the policy from mobilising opposition
...

TA has enabled the training of key policy advisers in the core ministries, especially
public sector economists in policy analysis
...
They have moved out of public service due to low pay, poor leadership
and inadequate resources with which to operate, leading to low morale, and
productivity
...
These include coordination of resources related
to technical assistance due to multiplicity of donor objectives, preferences and
strategies
...

Also emerging in the recent past are policy decisions that receive inputs from
enhanced voices of parliamentarians, the private sector, civil society and smallholders
as the process becomes more systematic, transparent and inclusive
...
And when the NARC government came to power in December 2002,
the preparation of its blue print for economic revival, the Economic Recovery
Strategy for Wealth and Employment Creation (ERSWEC) which addressed policy
issues in the agricultural sector as well, received widespread stakeholder consultations
with parliamentarians, donors, trade unions, professionals, financial institutions,
industrialists, ASAL representatives amongst others
...
The
Agriculture, Land and Natural Resources Committee is tasked to process and/or vet
proposed legislation from all the six ministries 3 involved in the sector
...
For instance, caucuses
have been created comprising MPs from areas growing three commodities, namely,
the Coffee and Tea Parliamentary Group (COTEPA) and the Sugar Parliamentary
Group (SUPA)
...

Along the same vein have emerged various civil society interest groups, which are
comprised of more farmers
...
Currently
efforts are underway to unite the sub-sectors into a national umbrella body with
representation from all the groups to enable them deal with issues that are crosscutting that include policies and a common voice in the policy process
...
Prior
to the era of reforms, the government dominated the allocation and management of
resources in the country
...

This meant limited participation by other stakeholders especially the private sector,
the civil society as well as the general population in the development process
...
It has further been argued that even within these
government institutions, the policy formulation group remained narrow 4
...
These largely contributed to the
success in the performance of the sector witnessed during this period
...

Government authority over the economy was also increased through the regulatory
framework and steady expansion of controls on macro economic variables like
domestic prices, interest rates, foreign exchange, and external trade
...
In the
wake of reforms however, there has been increased focus on the role of other actors,
with sustained advocacy for participation in resource mobilisation allocation and
management
...

Donors played an important role in policy reforms in the agricultural sector,
especially in the implementation of reforms in agricultural marketing and prices,
whose implementation were sometimes linked to donor conditionalities
...
The growing importance of programme and structural lending has
therefore had implications for the role of donors in policy formulation
...
It is argued that some technical assistance
advisors have had positive impact on the economic policy making process in the
country (O’Brien and Ryan 2001)
...
S and T
...
Ryan (2001)
...
In
...
, D
...
Holmgren (eds)
...
Lessons from ten Case studies, the World Bank, Washington D
...


27

resources through technical cooperation has at times led to lack of effective
implementation of development policies
...

In general, when analysing policy processes in the country, it is important to note that
one of the problems with effectiveness of policy has been the lack of implementation
of policy pronouncements
...
While
policies in the 1960s and early 1970s were mostly implemented, this has not been the
case over time
...
Some policies have also tended to respond more to short
term interventions, rather than focus on long term sustainable development
...

The conduct of the policy process in agriculture, therefore, is not a straight forward
formalised step by step exercise involving defined and recognised institutions
...
The process involves the central government, ministry of
agriculture, the executive, parliament and its caucuses, civil society (NGOs, FBOs,
CBOs, trade unions, etc), the budget process, development partners, interest groups,
the farming community, ethnicity and even the political system
...

iii
...
Through the
DFRD, central government departments are all represented at the district level,
leading to decentralisation of power and management of responsibilities
...
But still, it remained largely broad and was also relatively more
participatory than was the practice in previous years
...
There has emerged a relatively
greater role for various stakeholders and a voice for parliamentarians, the private
sector, civil society and the poor
...
The government subscribed to the
Poverty Reduction and Growth Facility (PRGF) in 2000, and started to prepare the
Poverty Reduction Strategy paper (PRSP 2001-04)
...
In a deviation from the past,

28

however, there were widespread stakeholder consultations nationally going down to
the grass roots
...
The Economic
Recovery Strategy for Wealth and Employment Creation (ERSWEC) was produced in
2003 to revive the economy
...

The Strategy for Revitalising Agriculture (SRA 2004) was started to complement the
ERS in agriculture and emphasises public-private sector partnerships to facilitate
competition, enhance markets, raise efficiency in the usage of resources and improve
private profitability
...

However, unlike the other policy framework documents before it that were
participatory, the SRA embodied no stakeholder consultations
...
It now nevertheless faces the challenge of
developing stakeholder ownership
...

The adoption of the PRGF by the government required it to formulate and implement
its budgetary process through the Medium Term Expenditure Framework (MTEF),
which seeks to link policy, planning and budgeting in order to improve budgetary
outcomes
...
Because the SRA outlines the agricultural sector priority areas set out
in the ERS, the MTEF process ought to allocate resources to these priority areas in
agriculture for their realisation
...

Policy making in general and within the ministry in particular, is tending towards
evidence-based findings from research undertakings of local consultants, universities
and policy research institutes (PRIs), which policy formulation had made very limited
use of in the past
...

Although Smith and Karuga (2004) argue that a general perception tends to persist of
low demand for evidence-based policy analysis and formulation due to the fear of loss
of power, influence, current employment and even economic rent through informed
policy reforms, there is some shift towards this direction given that some ministries
and other private organisations make use of the PRIs as much as they can to inform
their policies
...
The MTEF budgetary process will be required to allocate
resources as per the agreed priorities amongst the various stakeholders
...

iv
...
This has highlighted the role of
different stakeholders in the initiation and implementation of development projects
...
A number of initiatives illustrate these emerging
processes
...

The Millennium Villages Project
The Millennium Villages Project is a donor supported initiative that emerged after the
SRA had been produced
...
However, those
goals pertaining to the agricultural sector find themselves embodied with those of the
project
...

The MVP applies all the MDGs targets agreed upon by the UN member countries
aimed at reducing poverty
...
Kenya’s Sauri sublocation was selected in July 2005 to be the first Millennium Research Village5
...

The principal objective of this project is the eradication of absolute poverty by 2025,
but with a medium term goal of cutting it to half by 2015 through the holistic
application of the MDGs targets
...
Poverty, however, is relative and the poor who are targeted by the
project are the “poorest of the poor” generally referred to as the “extreme poor” or the
“absolute poor”, who comprise one sixth of humanity and cannot meet their basic
needs of survival unaided
...


5

The Earth Institute (2005), Annual Report: Millennium Research Villages
...


30

In recognition of this tragedy engulfing a sixth of humanity, the Earth Institute came
up with this project to assist them come out of the poverty trap and make first steps
towards development
...
The project works with investments of about US $50 – US $70 per
person per year and calls for investment in what is termed the “big 5”, which include
investments in agriculture, basic health, education, power, transport and
communication, and safe drinking water and sanitation
...

Smallholders have received inputs namely; fertilizer, seeds, and extension services
...
The MVP has been seen as an example of a donor initiated and implemented
process, but one that works with local stakeholders, the government and local
villagers all of whom act to complement donor resources financially or through own
labour
...
They have
had a bumper harvest; have new and renovated dispensaries with staff and medicine;
and their rural access roads have seen some improvement
...
Such efforts have
the potential to sustain long term agricultural development and should therefore be
facilitated
...
Being a pilot project, however, the currently visible
achievements could be short-term for the period of the project
...
The major challenge, therefore, remains how to sustain the gains into the
long-term and also entice the ripple effects into the future ad in neighbouring villages
and beyond
...

At the same time, the short lifespan of the project also means that its weaknesses have
not emerged and that the jury is still out
...
The anticipated
impact is that it would generate the desire to emulate what goes on in Sauri and have
similar outcomes
...
That could generate some
resentment as they would also expect financial support that may not be readily
available
...
They would tap into the resources they would
readily access like their own labour
...

The challenge for the government is also lack of the amount of resources that would
be required for such an initiative
...
The Needs Assessment and Costing Report estimated, for example, that
the country requires US $ 61 billion between 2005 and 2015 to achieve the MDGs
...
The bonding of the people and
the government to provide supplementary resources in terms of human effort and
additional local resources is, therefore, necessary but not sufficient
...
Tapping this and
even depending on it is unadvisable given the inability to honour even the
development assistance targets pegged as a ratio of their respective GDPs to the
developing world in general
...
Such initiatives date back to the
early 1980s when the District Focus for Rural Development (DFRD) was introduced
...

The motivation for the introduction of devolved funds was the desire to avoid
government red-tape, delays in disbursement, increase absorption rates, and
encourage people participation on prioritization of their needs in their localities to
enhance their ownership of projects amongst many other reasons
...
These Funds were
aimed at establishing rural/urban infrastructure with the incorporation of people’s
voices
...
Such developments
reflect a more participatory approach to resource mobilisation and utilisation where
development priorities as identified by the people are used
...

The funds impacts are important for the agricultural sector to facilitate the realization
of its goals
...
The access to markets and information provides
opportunities for use of improved technology for agro processing, storage, and other

32

forms of value addition
...
They open up more markets, create the potential to
add value to raw produce via the availability of rural power for agro-processing,
reduce wastage of raw and perishable commodities due to good rural roads and
possible cold storage facilities due to availability of power, and improve health status
of farmers thus enhancing their productivity amongst others
...
The
SRA does not explicitly reflect the devolution of funds as an important aspect for its
implementation, although the contribution of these funds especially rural
infrastructure is crucial for the envisaged commercialised, private sector led
agriculture
...

For the Funds to create the impacts for which they were designed, they not only need
continuity in terms of adequate funding, but also proper management structures with
the required capacity to deliver on their mandates
...
The management of some of them like the
CDF and LATF, has shown signs of being misused by the political elite to satisfy
their political objectives
...
At the same time, basically all of them anticipate wider
consultations with stakeholders and the respective communities, who also face limited
capacity problems
...
However, they may still not have the
necessary skills to perform these tasks
...
Capacity building for the Funds
management and stakeholders to perform roles anticipated for them under the various
Funds would be quite crucial for them to realise their roles satisfactorily
...
This will ensure that
agriculture where majority of the population is employed benefits from such
initiatives
...
The Funds thus have significant potential to influence and shape policy
implementation in agriculture, despite their current problems both
...
Sufficiency of Structures and Processes to Implement SRA
The success of any strategy in achieving its objectives depends on the structures that
exist to facilitate its implementation
...
The reform
agenda envisioned by SRA is ambitious
...
The structure of implementation has already been thought of
...
The national forum is expected to review progress
and discuss challenges limiting it and how to resolve them
...
But if practice in the past is anything to go by then presidential decrees might
still influence agricultural policy from the outside
...

The implementation framework also considers inputs from other sectors that are
important for its realisation
...
g
...
The committee also
comprises of private sector representatives
...
It is envisaged that at this level, technical inputs necessary for
the achievement of SRA can be brought on board akin to the Sector Wide Approaches
(SWAPs) initiative
...
This is particularly important since one of the factors constraining the
development of agricultural sector is the lack of coordination among the different
players in the sector
...
In the
recent past, the donors have also been encouraging consultative and participatory
processes in policy decision-making to enhance stakeholder and local ownership of
policy reforms 6
...
Nonetheless, donor
interests are flexible and are clothed in conditionalities, which can be susceptible to
variations thereby having the potential to disrupt the policy framework
...
It can only be
hoped that the proposed annual National Forum will have the capacity to deal with
such an eventuality
...
, NGOs, CBOs, FBOs
Workers Trade Unions and agricultural trade organizations amongst others to:
enhance farmers’ capacity to organize and use resources more efficiently; provide
education, health and extension services; provide advocacy for improved governance,
human rights and environmental protection; supply credit to disadvantaged groups
among others
...
This is,
nevertheless, beyond the SRA
...
Workers unions in the agricultural sector can be particularly
disruptive to the production process due to work stoppages
...
worldbank
...

The SRA, in particular, presses for private sector led growth in agriculture
...
The level of interaction
between government and the private sector must increase and stumbling blocks that
may impinge on private sector operations must be dealt with to create an environment
where they can make the envisaged contribution in the sector by SRA
...

Lessons, therefore, have to be drawn from previous initiatives on agricultural
development especially with respect to implementation, where lack of coordination
has been a major contributor to their failure
...
It is very important, therefore, for the supporting sectors and the
new development initiatives to integrate the agricultural sector when formulating their
agenda
...

In addition to some of the considerations mentioned above pertaining to the
framework, the SRA faces also faces a number of challenges in its implementation
...
The task ahead
is to market it to stakeholders for them to own up the intended reforms and effectively
participate by giving inputs in the implementation process
...

Secondly, the SRA lays out a massive reform initiative that requires it to have the
right manpower in place for its implementation
...
Capacity
building for the kind of staff and skills required are not well spelt out in the document
...
Such reforms will also require changes in
institutional structures for their implementation
...
These devolved funds are creating rural infrastructure that, without
them, would not have been undertaken at all
...
In
addition, they also open up markets for farmers whose produce would reach
destination markets with difficulty and at high costs
...


35

Fifth is that the strategy envisages a wider market for agricultural commodities to
expanded regional and international markets
...
It is only with such an
assessment that they can determine what share of the market of these commodities
they can capture and talk of expanded markets for the sector’s produce
...

Beyond anything else, the SRA’s implementation requires the budgetary process to
allocate sufficient funding for the proposed reforms
...
There are therefore some inconsistencies here in
the sense that the SRA is long term whereas the budgetary framework is short- to
medium-term
...
This
will necessitate quite close collaboration between the strategy’s implementation and
the budgetary process to ensure that up to its 10th year of implementation the
budgetary process will be able to allocate adequate resources to its projects and/or
programmes
...
In addition, if the decision makers at the
resource allocation level have not been involved and/or lobbied as it seems due to lack
of stakeholder consultations when the strategy was being prepared, then the reforms
might not see the light of day because they require resources for their implementation
...

It is important to recognise that the emerging policy formulation environment has
fundamentally changed over time
...
However, there are still a
number of weaknesses, which include lack of reliable and updated data, weaknesses
in the budgetary process, problems of inter-ministerial co-ordination, personality
driven processes, vested interests and confused paradigms and policy narratives
...
These include donor coordination and support, strengthening voices and creating local ownership of and
commitment to the policy and budgetary processes
...
However challenges still exist even with this restructuring
...
Lack of funds for extension services also threatens
the realisation of technical service delivery
...
Due to the acknowledged lack of funds, it
will also be necessary to secure additional funding to strengthen extension service

36

delivery and to rationalise all projects to avoid duplication (Kenya 2006)
...
This calls for a unified strong ministerial
monitoring and evaluation
...
service

1992-96

Total GDP

1997-2000

References
ILO (2002)
...
Jobs for Africa
Programme, ILO Area Office, Dar es Salaam
...
Kenya: Meeting the Employment challenges of the 21st
Century, Geneva
...
Draft National Livestock
Policy
...
and Okello, J
...
Kenya’s Agricultural Policy and Sector
Performance: 1964-1996, IPAR, Occasional Paper No
...

Njuguna, N
...
and Gareth, W
...
Strengthening the Incentives for
Pro-Poor Policy Change: An Analysis of drivers of change in Kenya, Summary
Report to DFID
...
S and T
...
Ryan (2001)
...
Devarajan S
...
Dollar and T
...
Aid and Reforms in Africa
...
C
Republic of Kenya (2006)
...

Nairobi
...
Economic Survey 2005
...

Republic of Kenya (2004)
...

Republic of Kenya (2003a)
...

Republic of Kenya (2003b)
...
Ministry of
Planning and National Development, Nairobi
...
National Development Plan 2002–2008
...
Economic Survey 2001
...
Kenya Human Development report 1999
...
Ministry of Agriculture, Livestock Development and
Marketing
...

Smith, L
...
(2004)
...


39

UNDP (2003)
...

UNDP (2002)
...

Were, M
...
Al
...
12
...
worldbank

---