Flower growers and exporters in East Africa are calling for stronger regional cooperation to address rising freight costs, trade barriers, and tax challenges threatening the competitiveness of the horticulture industry.
Kenya Flower Council Chief Executive Officer Clement Tulezi said geopolitical tensions, particularly the conflict in the Middle East, had sharply increased the cost of doing business, leaving growers and exporters struggling to maintain operations.
“The growers and exporters are basically surviving at the moment,” Tulezi said, noting that the industry was unlikely to record significant expansion in the coming year unless the operating environment improved.
Speaking to the media on the sidelines of the launch of Horticulture Council of Eastern Africa (HoCEA), he said freight costs had become increasingly uncompetitive over the past five months, adding that prolonged disruption in the Middle East could further affect the movement of flowers to international markets.
Tulezi urged the government to expedite payment of Value Added Tax (VAT) refunds owed to exporters, saying the outstanding claims were affecting companies’ cash flows.
“In Kenya alone, we are looking at about Sh12 billion that the government owes us,” he said, adding that some claims dated back two to three years despite regulations requiring VAT refunds to be processed within six months.
He said the accumulation of VAT refunds was becoming unsustainable, with some companies owed more than Sh2 billion individually.
Tulezi complained about the current voucher system for settling VAT refunds, saying exporters needed a mechanism that would allow them to offset the amounts against a wider range of tax obligations.
He also called for fresh produce to be treated as a strategic sector in policymaking, noting that growers and exporters faced more than 50 taxes and levies annually. “We need to have a situation where policy is created depending on the sector,” he said.
Tulezi said the region also needed to make better use of existing frameworks under the East African Community, the Common Market for Eastern and Southern Africa (COMESA), and the African Continental Free Trade Area (AfCFTA).
He cited instances where flowers produced in Kenya or Ethiopia were routed through the Netherlands before being exported to markets such as Ghana, increasing costs and undermining regional trade.
“Products that are coming from Uganda should find their way as a region and trade as a continent,” he said.
Tulezi said harmonising sanitary and phytosanitary (SPS) requirements, customs procedures, and other regulatory measures would make it easier for agricultural products to move across borders.
He also urged East African countries to negotiate collectively with airlines and freight operators, saying individual countries had limited bargaining power. “If we put our collective voice together, then we have leverage over this,” he said.
The regional flower industry exports close to 500,000 tonnes annually, according to Tulezi, creating an opportunity for growers and exporters to consolidate volumes and negotiate more competitive freight rates.
He said improved movement of goods and people, harmonized standards, and reduced trade barriers would enable East African producers to benefit more from the region’s large consumer market and strengthen their position in international trade.
State Department for Trade representative Matthew Kipchumba Komen said the government would work with the private sector to identify policy gaps and negotiate removal of barriers limiting access to regional and international markets.
Komen said the launch of the Horticulture Council for Eastern Africa (HOCEA) comes at a time when the private sector is increasingly looking beyond individual countries and embracing regional markets.
“The private sector has matured, especially in the horticultural sector, and is now thinking on a regional platform,” he said, assuring governments support to the sector through policy interventions and negotiations aimed at opening markets in Africa, the European Union, the United Arab Emirates, the United States, and other international destinations.
Uganda Flower Exporters Association Executive Director Esther Nekambi said the regional body was seeking to strengthen the capacity of smaller and less-developed horticultural markets so they could access international markets while also benefiting from intra-regional trade.
Nekambi said harmonizing standards across East Africa and addressing non-tariff barriers (NTBs) would be critical to improving trade, particularly for smallholder farmers and small and medium enterprises.
“We want to grow together and probably have a better future,” she said, adding that fragmented standards and regulatory requirements were making it difficult for businesses to trade across borders.
Nekambi noted that smallholder farmers and SMEs often lacked the capacity to understand and take advantage of regional trade protocols, adding that the regional platform would therefore seek to translate the protocols and agreements of Regional Economic Communities into simple, user-friendly tools and manuals that agricultural value-chain actors could use.
HoCEA Chairperson Dr. Jacqueline Mkindi said the council would provide a unified voice for the region’s horticultural industry while pushing for solutions to cross-border trade barriers, logistics challenges, technical requirements, and inefficiencies affecting farmers and exporters.
“We will focus on reducing post-harvest losses, which are estimated at between 30 and 80 per cent in some horticultural value chains, through farmer training, improved infrastructure, and better handling of produce,” she said.
Dr. Mkindi promised that HoCEA would not only mobilize resources to support infrastructure, collection centers, and cold storage facilities, but it would also help farmers and other value chain actors understand international markets while at the same time seeking greater participation of African producers in the development of international standards, instead of waiting to comply with requirements set elsewhere.
HoCEA will be a regional, private-sector-led platform established to strengthen coordination, advocacy, market access and institutional engagement within the horticulture sector.
HoCEA is working with national horticulture associations across the region, with support from TradeMark Africa (TMA), with the council expected to provide a stronger regional voice for the sector and create a platform through which industry players can collectively engage policymakers and other stakeholders on issues that affect horticulture competitiveness.
By Wangari Ndirangu
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