Farmers are supporting a move to revert Kenya's market leader in the tea industry into a parastatal, saying the change would give them control over the agency. They say while it was initially meant to protect farmers' interests, the Kenya Tea Development Agency (KTDA) has been riding on their backs and should be regulated to ensure closer scrutiny of its operations.
"The management has been enriching themselves at the expense of farmers instead of assisting them," said James Kinyanjui, the secretary general of the Kenya United Small Scale Tea Owners Organization (KUSSTO). "If each factory is autonomous and with its managing director, it will
let the farmers run their affairs."
KTDA, a private smallholder tea farmers' organisation representing approximately 430,000 growers, was un-linked from the government in 2000 through a legal notice. MPs recently passed a motion to compel the agriculture minister to repeal the notice. MP Jimmy Angwenyi, the mover of the motion, argued that turning KTDA into an authority would enable farmers to get fertiliser at cheaper prices. 23 MPs from tea-growing areas demanded the immediate disbandment of KTDA for allegedly defrauding farmers of Sh600 million ($89 million). The legislators also accused the body of improper procurement of tea fermenting machines, at the expense of farmers.
However, critics say the move to reverse the 2000 privatisation would be a slap in the face of liberalisation and would impact the local industry tremendously.
The KTDA defended itself against allegations of improper tendering, saying that as a private company, it was not subject to public procurement rules. It is run by farmers, other shareholders and an elected board of directors. Ideally, it is the farmers who hold the whip. But Kinyanjui said that KTDA does not represent the interests of farmers, who only employed it to manage the 54 tea factories in the country. Instead, he said KUSSTO was the legitimate representative of the country's tea,farmers.
But MPs say the small-scale farmer has no say in decision-making regarding procurement of machines, motor vehicles and industrial oil, whose cost impacts on their incomes. But it should not be lost on observers that in 2000 the MPs' successfully argued for the privatisation of KTDA. Government interference and a convoluted public procurement system, which give birth to corruption, were then cited as reasons why government had to keep off KTDA.
The Agency has entered into a three-year sustainable tea production project with Lipton, the world's best tea-selling brand that buys about 40 per cent of KTDA tea, which could enhance the premium on Kenyan tea in the world market.
Tea is Kenya's second top foreign exchange earner, behind tourism. Tea production fell 5.4 percent to 310.6 million kg last year due to drought, but income over the year rose 11.8 per cent to Sh 47.3 billion ($705 million).
Business Daily
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