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A Value Chain Analysis of Fresh Vegetables in Kenya and Tanzania

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SLE Publication Series Market-driven development and poverty reduction: A value chain analysis of fresh vegetables in Kenya and Tanzania Commissioned by Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) GmbH – Beratungsgruppe Entwicklungsorientierte Agrarforschung (BEAF) African Insect Science for Food and Health (icipe) and The World Vegetable Center – Regional Center for Africa (AVRDC-RCA) Associated Partners GTZ – PSDA Nairobi Ministry of Agriculture, Kenya Project Team: Thomas Koenig (Team Leader), Jantje Blatt, Kristian Brakel, Kristina Kloss, Thorsten Nilges, Franziska Woellert Nairobi, Berlin, January 2008 Disclaimer: The findings, interpretations, and conclusions in this report are those of the authors. They do not necessarily represent the views of the German Federal Ministry for Economic Cooperation and Development (BMZ) or the German Technical Cooperation (GTZ). Schriftenreihe des SLE (Seminar für Ländliche Entwicklung) SLE Publication Series (Centre for Advanced Training in Rural Development) Herausgeber / SLE Seminar für Ländliche Entwicklung Editor (Centre for Advanced Training in Rural Development) Humboldt Universität zu Berlin Sitz: Hessische Straße 1-2 10115 Berlin, Germany E-Mail: [email protected] Internet: www.agrar.hu-berlin.de/sle www.berlinerseminar.de Redaktion / Gabriele Beckmann Managing Editor SLE Layout Dorian Frieden SLE Druck / Zerbe Druck & Werbung Printing Planckstr. 11 15537 Grünheide OT Hangelsberg Vertrieb / SLE Distributors Hessische Straße 1-2 10115 Berlin 1. Auflage 2008 / 1-200 1st edition 2008 Copyright 2008 by SLE ISSN 1433-4585 ISBN 3-936602-32-8 Titelbild / Central Market in Arusha, Tanzania, and onion bags in Tanzania for the Cover photo cross-border trade, Kristian Brakel Foreword v Foreword The Centre for Advanced Training in Rural Development (Seminar für Ländliche Entwicklung), at the Humboldt University Berlin, has trained young professionals in the field of German and international development cooperation for more than forty years. Three month consulting projects conducted on behalf of German and international cooperation organisations form part of the one-year postgraduate course. In multidisciplinary teams young professionals carry out research on innovative future- oriented topics, and act as consultants. Involving various local actors in the process is of paramount importance here. The findings of this “applied research” provide an immediate contribution to solving development problems in rural areas. Over the years, SLE has managed more than a hundred consulting projects in more than sixty countries, and regularly publishes the results in this series. th In 2007 four groups from the 45 course of the SLE simultaneously executed projects in Burkina Faso, Kenya and Tanzania, Mozambique and Philippines which focussed on the planning and poverty-orientation of development programmes. The present study was sponsored by the German Technical Cooperation (GTZ) and the German Federal Ministry for Economic Development and Cooperation (BMZ). Prof. Otto Kaufmann Carola Jacobi-Sambou Dean Director Agricultural Horticultural Faculty SLE – Centre for Advanced Humboldt University Berlin Training in Rural Development vi Acknowledgements Acknowledgements Preliminary Note On 27 December 2007 the presidential election was held in Kenya. Immediately following the election large-scale riots took place to protest against the delay in the vote count and against the election result itself. Since then there have been violent clashes along political and ethnic lines in the course of which almost 800 people have lost their lives. The study team is appalled by these events. We were in Nairobi and the neighbouring regions in Kenya during the election campaign and we spent a very peaceful time there. During the months spent in Kenya the SLE group had no inkling that the situation would escalate to such an extent. On a day to day basis we did not experience Kenyan tribal allegiances as a universally determining factor. Our partners and the people we interviewed for the study cooperated beyond ethnic lines. Our thoughts go out to these people who were so helpful and open to us during our stay. The thought that the lives of some of our partners are endangered by the riots and that others might be the victims of violence is very distressing for us. We truly hope that peace will soon return to Kenya and – with the support of the donor community – that reforms take place that will really help the poorest Kenyans. First of all, the study team would like to thank GTZ-BEAF, represented by Michael Bosch, for the commission to carry out the present study. Dr. Dagmar Mithöfer, icipe, and Stefan Pletziger, AVRDC; acted as the representatives of our partner institutions in Kenya and Tanzania. We are very thankful for their support with logistics and organisation as well as their brilliant expertise. Hassan Mndiga, AVRDC, was a very important key resource person who provided a great deal of important input for the study. In Kenya we cooperated closely with GTZ-PSDA, represented by Eberhard Krain, Margaret Orina and Heike Höffler. Monica Mueni and Virginia Mwai, both Ministry of Agriculture in Kenya, were very supportive during the data collection in Kenya. All of them helped the team to establish contacts to interview partners and provided detailed information on the Kenyan situation. Our cooperation with the translators was fruitful and effective in carrying out the interviews at all levels as we intended. We would like to thank Gladys Machange, David Solomon, Mayson Ruangisa, Peter Karanka and Francis Imani in Tanzania and Teresiah Mbugua and Gibson Githaiga in Kenya for their excellent cooperation. During our data collection the team split up into subgroups at different production sites and markets to carry out interviews. We appreciated the collaboration with our Acknowledgements vii counterparts in assisting us in contacting all the interview partners and receiving detailed information about the local situation. In Tanzania we cooperated with Simon Loto, Arumeru District, Mr. Maganga, Karatu District, and Fatuma Mdibalema, Arusha Municiplatiy Council. In Kenya Peter Ndungu, Farm Concern International, and Peter Makokha, MoA, both in Kieni West, Obadiah Mwangi in Mwea as well as Duncan Murithi, Farm Concern International and Monica Mueni, MoA, assisted us in Nairobi. For the issue of cross-border trade we would like to thank Josphat Mugambi, Kenyan trader, in particular for his open minded cooperation. We talked to more than one hundred interview partners in both countries. This study would not have been possible without their willingness to spend so much time with us. The SLE team, namely Iris Paulus and Gabi Beckmann provided valuable comments on our work at different stages. Nicholena Gann proofread the study to check the English language and Dorian Frieden finalised the layout. We would like to express our thanks to everybody mentioned here for their particular support and contribution to this study. The SLE-Team viii Executive Summary Executive Summary In recent years horticulture’s relevance has increased in East Africa. Mainly export oriented middle and large scale enterprises have benefited from this development. At the same time, domestic demand for horticultural products has increased due to a rapidly growing urban population and relatively high income elasticity linked to demand for vegetables. Agriculture in general plays an important role in both countries’ economies as the share of the Kenyan and Tanzanian GDP indicates (24% in Kenya und 45% in Tanzania). Strengthening the labour intensive horticulture sub-sector could contribute to poverty reduction, because the majority of the poor population lives and works in rural areas. This is one of the core hypotheses of the present study. Horticulture in this context includes the entire value chain from production up to consumption of vegetables. Tomatoes and onions were chosen as the focus products of the study, because both commodities play an important role in the domestic vegetables market and, furthermore, the two research institutes icipe and AVRDC, with whom the study team cooperated, are particularly interested in these crops. The following three major research areas were identified: • Investigation into the potential for poverty reduction within a market-driven development of the respective value chains, • Analyses of the cross-border onion trade between Tanzania und Kenya, • Value chain comparison of the two countries. First of all, in order to carry out the survey the poor actors of the value chains were identified, secondly their relation and power distribution among the actors was analysed and thirdly the legal regulations in force, the issue of standards in particular, were considered. The analyses of fresh vegetables’ value chains include the input supply, production, various stages of trading and marketing and finally consumption. Transport has been considered as a cross-sectional issue, because different actors provide this service at different stages within the chains. The regional cross-border trade of onions between Tanzania and Kenya is subsumed under domestic trade in statistical terms. In addition to this functional perspective of value chains, there is an institutional perspective focusing on the actors’ contribution to the chains. The study team combined this institutional perspective with the livelihood approach in order to determine the actors’ living conditions and their vulnerability within the value
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