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Coalition for African Rice Development

FINAL REPORT

Silas IREA Kenya National Consultant

October 2010

Mapping of Poverty Reduction Strategy Papers, Sector Strategies and Policies related to

Rice Development in Kenya

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Cover photographs Top: Rice ears collected from a small rice farm, Mandlakazi, Mozambique Middle: Row-planted rice, Nyachoda Irrigation Scheme, Nyanza, Kenya Bottom: Extension officer briefs a JICA mission, Nyachoda Irrigation Scheme,

Nyanza, Kenya Acknowledgement The study “Mapping of Poverty Reduction Strategy Paper (PRSP), Sector Strategies and Policies related to Rice Development in Kenya” was commissioned by the Coalition for African Rice Development (CARD) under the auspices of the Alliance for a Green Revolution in Africa (AGRA) and funded through a small Grant from the International Fund for Agricultural Development (IFAD). The study was carried out by Mr. Silas Mutea Irea - Rural Development Consultant The consultant would like to thank all those who volunteered information for the study for their kind support and constructive ideas. Special appreciation goes to Souleymane Diouf, the Study Regional Coordinator for his patient guidance in preparing this report. Disclaimer The contents of this report reflect the findings, interpretations and opinions of the consultant. They do not necessarily represent the opinions of CARD, AGRA JICA, Government of Kenya or their partners and should not be attributed to them. Silas M. IREA Consultant in Agriculture and Rural Development No. 4, 17th Kerarapon Drive P.O Box 851-00502 NAIROBI, Kenya Tel: +254-20-3505094/( )-722-751816 Email: smutea@publixafrica.com silasirea@yahoo.com

Nairobi, October 2010

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ABBREVIATIONS AND ACRONYMS AFC - Agricultural Finance Corporation AfDB - African Development Bank AGRA - Alliance for a Green Revolution in Africa AIDS - Acquired Immuno-Deficiency Syndrome AIE - Authority to Incur Expenditure AMS - Agricultural Mechanization Service ASAL - Arid and Semi-Arid Lands ASCU - Agricultural Sector Coordination Unit ASDS - Agricultural Sector Development Strategy ATC - Agricultural Training Centre AWP&B - Annual Work Plan and Budget CAADP - Comprehensive Africa Agriculture Development Programme CARD - Coalition for African Rice Development CDF - Constituency Development Fund CGA - Cereal Growers Association COMESA - Common Market for Eastern and Southern Africa DADC - District Agricultural Development Committee DAO - District Agricultural Officer DFID - Department for International Development EAC - East African Community ERS - economic Recovery Strategy ERSWEC - economic recovery Strategy for Wealth and Employment Creation FAO - Food and Agriculture Organization (of the United Nations) FARA - Forum for Agricultural Research in Africa FMTP - First Medium Term Expenditure Framework GAP - Government Action Plan GDP - Gross Domestic Product GOK - Government of Kenya HIPC - Highly Indebted Poor Country HIV - Human Immuno-deficiency Virus IFAA - Innovation Fund for Agriculture and Agribusiness IFAD - International fund for Agricultural Development IMF - International Monetary Fund IPRSP - Interim Poverty Reduction Strategy Paper IRRI - International Rice Research Institute JICA - Japan International Cooperation Agency JIRCAS - Japan International Centre for Research in Agricultural Sciences KARI - Kenya Agricultural Research Institute KASAL - Kenya Arid and Semi-Arid Lands KEPHIS - Kenya Plant Health Inspectorate Service KNFC - Kenya National Federation of Cooperatives KShs/KES - Kenya Shilling

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LBDA - Lake Basin Development Authority MDG - Millennium Development Goal MIAD - Mwea Irrigation and Agriculture Development MOA - Ministry of Agriculture MOWI - Ministry of Water and Irrigation Development MT/ton - Metric Ton MTEF - Medium Term Expenditure Framework MTP - Medium Term Plan NCPB - National Cereals and Produce Board NDS - National Development Strategy NEPAD - New Partnership for Africa’s Development NERICA - New Rice for Africa NIB - National irrigation Board NMK - Njaa Marufuku Kenya NPAI - National Programme for Agricultural Investments NPK - Nitrogen Phosphorus Potassium NRDS - National Rice Development Policy NRM - Natural Resource Management NSCF - National Stakeholders Consultative Forum NSDP - NERICA Sustainable Dissemination Project NVL - National Variety List O&M - Operation and Maintenance PCT - Post Control Test PDA - Provincial Director of Agriculture PDM - Project Development Matrix PER - Public Expenditure Review PRSP - Poverty Reduction Strategy Paper PSDA - Private Sector Development in Agriculture RIPU - Rice Promotion Unit RVC - Rice Value Chain SACCO - Savings and Credit Cooperative Organization SWAP - Sector-Wide Approach SRA - Strategy for Revitalization of Agriculture STI - Science, Technology and Innovations TARDA - Tana and Athi Rivers Development Authority TICAD IV - Fourth Tokyo International Conference for African Development TOR - Terms of Reference UK - United Kingdom WARDA - Africa Rice Centre WB - World Bank WUA - Water Users’ Association

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SUMMARY 1. This report presents findings of a study to map poverty reduction strategy papers, sector

strategies and policies related to rice development in Kenya. The main objectives of the study were to:

i) To assess the coherence and linkages between the National Rice Development Strategy (NRDS) and the relevant planning and programming frameworks including (a) Growth and Poverty Reduction Strategies or equivalent, (b) relevant Sector-Based Strategies, (c) Public expenditure frameworks at national/sector levels, (d) On-going rice related programmes/projects, and (e) Other relevant international programmes (including CAADP and NEPAD initiatives).

ii) To provide a basis for reconciling the NRDS’s requirements (demand side) in terms of policy, institutional and investments measures/actions and the related opportunities (supply side) as indicated in above planning frameworks and tools.

2. Kenya has had a long period of national development strategising as contained in Sessional Papers and Vision statements which have continued to guide medium term planning. Kenya has also consistently drawn sectoral strategies and plans for agricultural development starting with the Swynnerton Plan of 1954 to the current Poverty Reduction Strategy Paper called First Medium Term Plan 2008-2012 drawn under the Vision 2030 Strategy. Sectoral plans such as the National Water Master Plan and the National Rice Development Strategy are drawn against these broad strategies and policy blueprints.

3. Rice is the third most important staple cereal in Kenya after maize and wheat and Kenya is able to produce only 20% of her national needs. There is need to increase rice production through irrigation, rain-fed production and use of improved technologies, and there is great need to improve the rice value chain so as to raise efficiency of input supply, production, processing, handling and marketing of rice in Kenya and in the region.

4. Kenya has set for herself a target of increasing rice from the current 75,000 MT/year to 178,580 MT/year by 2018, the period set for implementation of the NRDS. This will be achieved using current funding frameworks through treasury allocations and through support from partner funding multi-lateral and bilateral agencies under the guidance of the Coalition for African Rice Development Initiative (CARD).

5. Kenya has set for herself lofty targets on how to achieve this rice increase. For example, the Irrigation and Drainage Master Plan Study (2009)1 of the Ministry of Water and Irrigation establishes the following:

1 Republic of Kenya, Ministry of Water and Irrigation, (2009), Irrigation and Drainage Master Plan.

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Plan 1. Increase irrigation and drainage command areas

Target: Develop new irrigation and drainage command areas at the rate of 32,000 ha per year. Specific interventions 1. Expansion of existing public irrigation schemes as follows:

• Increase Mwea scheme’s irrigated area from 6,000 to 10,000 ha • Increase Ahero scheme’s irrigated area from 860 to 3,000 ha • Increase Bunyala scheme’s irrigated area from 213 to 6,000 ha • Increase Hola scheme’s irrigated area from 870 to 2,500 ha • Increase Bura scheme’s irrigated area from 2,500 to 6,700 ha

2. New development of public irrigation schemes as follows:

• Develop 15,000 hectares in Kano Plain • Develop 1,300 hectares in Turkwel • Develop 1,340 hectares in Arror • Develop 6,000 hectares in Taita Taveta

3. New development of public drainage schemes as follows:

• Develop 15,000 hectares of drainage for agriculture in the Lake basin 4. Increase private irrigation schemes

• Around the Lake Victoria shores • In the Tana Delta area • Sugar cane irrigation in the sugar cane growing areas

5. Increase smallholder irrigation schemes

• Expansion of existing smallholder irrigation schemes by increasing water use efficiency and constructing 90 days storage

• Promote the use of bucket kit irrigation • Tap wastewater irrigation potential in urban areas

Plan 2. Rehabilitation of existing irrigation and drainage command areas Target: Rehabilitate existing irrigation and drainage areas at the rate of 8,000 ha per year Specific interventions

i) Rehabilitation of existing public irrigation schemes (West Kano, Perkerra, Bura, Hola, Mwea, and Bunyala)

ii) Rehabilitation of smallholder irrigation schemes Plan 3. Increase crop yields in irrigation and drainage command areas Target: Increase irrigation and drainage crop yields by at least 10% of the yield gap each year. Specific interventions

i) Improve availability and affordability of crop production inputs

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ii) Provide seasonal input credit iii) Enhance extension service delivery in irrigation and drainage command areas iv) Improve profitability of irrigated and drainage agriculture by securing markets

Plan 4. Diversification of livelihood in irrigation and drainage command areas Target: Contribute to crop and other enterprise diversification by expanding the range of horticultural crops, integrating livestock and fisheries in 100 irrigation and drainage projects per year. Specific interventions

i) Enhance fishery production through the introduction of aquaculture in irrigation and drainage canals

ii) Enhance livestock production through the production of high value fodder (alfalfa), utilization of irrigation crop residue as livestock feed and mitigation of irrigation-livestock conflicts.

iii) Increase in percentage of the area under high value crops in smallholder schemes iv) Increase in the area under food crops

Plan 5. Enhance utilization of modern science and technology Target: Enhance utilization of science and technology in irrigated and drainage agriculture by improving access to up-to date and relevant information and knowledge. Specific interventions

i) Reduce water losses through the lining of irrigation canals and construction of in-field overnight storage.

ii) Improve water use efficiency by improving water application methods and adopting appropriate cropping systems.

6. While these aspirations serve as the ultimate targets, they cannot be achieved in the

short and medium term under the present financing arrangements - the Medium Term Expenditure Framework (MTEF) and the Sector-wide Approach (SWAP) - where budgetary allocations for agricultural sector ministries account for less than 5% of the national budget. Moreover, more than 60% of this allocation goes to fund recurrent as opposed to development expenditure.

Under these circumstances, the MOA has prepared a roadmap to guide rice development to achieve annual targets and ultimately the 2018 production target of 178,580 MT. The roadmap is not a proposal of any project, but it encourages stakeholders (MoA, MWI, KARI, NIB, TARDA, PDAs, DAOs, etc.) to formulate as many realistic, efficient and effective projects as possible. It shows how to prepare a project at the national and district levels and recognizes the fact that although rehabilitation and construction of new big irrigation facilities is the most effective way to increase rice production, those projects may be considered in the long term strategy i.e. beyond 2018 when the NRDS expires. Within this roadmap and NRDS, a key strategy will be expansion of area planted with NERICA because this requires minimal investment.

7. To support the expansion of area planted with NERICA the roadmap envisages a simplified seed production system as set out in Figure S.1.

Figure S.1: Proposed NDERICA Seed Prod

Source: MOA/RIPU, 2010

8. It has been observed that rehabilitation of the Aheroimportant milestone in in Annex C.

9. A proposed JICA-funded implementation is scheduled to commence in 2011 and completion is planned for 2016. Details of this project are contained in Annex D.

10. With government funding and JICA support, in Mwea and Ahero this yearstill the dissemination of NERICA accordance with the road map. This can be financed through the existing fr

11. Report structure: The report1, a review of strategies, policies and expenditure frameworks in Section 2, an analysis of strategies, policies and expenditure frameworks Section 3 where matrices have been extensively usedNRDS. Gaps in the implementation of the NRDSSection 5 carries the opportunities for meeting the unsatisfied needsConclusions and Recommendations. The Appendices contain case studies of section of stakeholders in the rice value chain and presentations of onrecently completed projects related to rice development.

To support the expansion of area planted with NERICA the roadmap envisages a simplified seed production system as set out in Figure S.1.

Figure S.1: Proposed NDERICA Seed Production System

Source: MOA/RIPU, 2010

served that an increase of 1,000 MT of rice would be Ahero Irrigation Scheme could be completed in time. This

milestone in the road map. The Ahero project is presented in greater detail

funded Project in Mwea is the next milestoneimplementation is scheduled to commence in 2011 and completion is planned for 2016. Details of this project are contained in Annex D.

With government funding and JICA support, NERICA experiment Ahero this year. But the key to expansion of rice production in Kenya

the dissemination of NERICA to existing and new rice growing areas in accordance with the road map. This can be financed through the existing fr

The report presents a background on planning in Kenya in Section of strategies, policies and expenditure frameworks in Section 2, an

analysis of strategies, policies and expenditure frameworks in relation to NRDS Section 3 where matrices have been extensively used to match the strategies to

implementation of the NRDS are presented in Section 5 carries the opportunities for meeting the unsatisfied needsConclusions and Recommendations. The Appendices contain case studies of

of stakeholders in the rice value chain and presentations of onrecently completed projects related to rice development.

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To support the expansion of area planted with NERICA the roadmap envisages a

of rice would be attained in 2011 if Irrigation Scheme could be completed in time. This is an

The Ahero project is presented in greater detail

next milestone. Project implementation is scheduled to commence in 2011 and completion is planned for

ent have been initiated . But the key to expansion of rice production in Kenya

to existing and new rice growing areas in accordance with the road map. This can be financed through the existing frameworks.

in Kenya in Section of strategies, policies and expenditure frameworks in Section 2, an

in relation to NRDS in to match the strategies to

are presented in Section 4 while Section 5 carries the opportunities for meeting the unsatisfied needs. Section 6 bears Conclusions and Recommendations. The Appendices contain case studies of a cross

of stakeholders in the rice value chain and presentations of on-going and

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TABLE OF CONTENTS 1. INTRODUCTION ........................................................................................................................... 1

1.1 Background ............................................................................................................................. 1

1.2 Study Objectives ..................................................................................................................... 3

1.3 Methodology ........................................................................................................................... 4

2. STRATEGIES, POLICIES, PROGRAMMES AND EXPENDITURE FRAMEWORKS ............ 6

2.1 Kenya’s Early Strategies for Poverty Reduction and Transformation of Agriculture............. 6

2.2 Kenya after Independence ....................................................................................................... 7

2.3 Advent of the PRSP and Vision 2030 ..................................................................................... 8

2.4 Sector-based Policies, Programmes and Strategies ............................................................... 16

2.4.1 Overview of the Agriculture Sector .............................................................................. 16

2.4.2 The Swynnerton Plan .................................................................................................... 17

2.4.3 Agricultural Sector Development Strategy (ASDS) ...................................................... 17

2.4.4 National Rice Development Strategy ............................................................................ 23

2.5 Agricultural Policy ................................................................................................................ 27

2.6 Food Policy and Imports ....................................................................................................... 28

2.7 Programmes and Projects ...................................................................................................... 29

2.8 Current Public Expenditure Framework and Funding Processes .......................................... 32

3. MATCHING OF THE STRATEGIES, POLICIES, PROGRAMMES AND THE EXPENDITURE FRAMEWORKS WITH THE NRDS’ SUB-SECTORS.......................................... 33

4. DETERMINATION OF UNSATISFIED NEEDS ....................................................................... 41

4.1 Needs in the Operational Domain ......................................................................................... 41

4.2 Needs in the structuring domain ............................................................................................ 42

4.3 Costs of unsatisfied needs - Operational domain and structuring domains ........................... 42

5. OPPORTUNITIES FOR MEETING THE UNSATISFIED NEEDS ........................................... 47

5.1 NRDS Subsectors .................................................................................................................. 47

5.2 Rice Value Chain Analysis Findings ..................................................................................... 47

5.3 Relevant Opportunities for Increasing rice Production in Kenya.......................................... 49

6. CONCLUSION AND RECOMMENDATIONS .......................................................................... 52

6.1 Key Stakeholders in the Rice Value Chain ........................................................................... 52

6.2 Actions required to improve the status of the rice value chain ............................................. 52

6.2.1 Recommendations from the Rice Value Chain Study ................................................... 52

6.2.2 Actions from the Implementation of the NRDS ............................................................ 52

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LIST OF TABLES Table 2.1: Kenya Development Plans prior to Independence Table 2.2: Plans and other Intervention Measures in Independent Kenya to 2003 Table 2.3: Plans under PRSP Scheme Table 2.4: FMTP (2008-2012) Agricultural Subsector Major Constraints Table 2.5: ERS Strategies for Agricultural Development Table 2.6: Budget Allocation to the Agriculture Sector Ministries, KShs Million Table 3.1: Summary of Constraints and Solutions for Development of the Agricultural

Sector and Rice Sub-sector (Matrix 1) Table 3.2: Analysis of Strategic Measures and Actions to Improve Agriculture (Matrix 2) Table 3.3: Frameworks of Policies/Dialogue - Ongoing and Planned with Inputs for

NRDS (Matrix 3) Table 3.4: Programmes/Projects of Partners in Development with Inputs for NRDS

(Matrix 4) Table 3.5: Small projects with an input for NRDS Table 4.1: Number of Researchers, Technicians and Extension Workers in 2008 and

Targets in future Years Table 4.2: Institutional Roles Table 4.3: National Rice Development Strategy Implementation Framework Financing

Plan (2008-2013) Table 5.1: Actors in the Rice Value Chain Table 5.2: District Data and Potential of Rice Production Increase to 2010 Table 6.1: Norms for field inspections Table 6.2: Norms for laboratory analyses Table 6.3: Provisional Seed Production Schedule (NERICA No.4) LIST OF FIGURES Figure 1.1: Agriculture’s Contribution to the Kenyan Economy 2001-2005 Figure 2.1: Framework of the Role of Development Partners in the PRSP Figure 2.2: NRDS Implementation Framework Roadmap Figure 2.3: Proposed Rice Seed Production System ANNEXES A: Case Studies

Case Study 1: Kenya Plant Health Inspectorate Service (KEPHIS) Case Study 2: Marakwet West District Agricultural Office Case Study 3: Cereal Growers Association Case Study 4: Lake Basin Development Authority

B: Objectives set out in the National Water Master Plan for Rice Development C: Ahero Irrigation Scheme D: JICA-funded Mwea Irrigation Development Project

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1. INTRODUCTION 1.1 Background Agriculture remains the backbone of the Kenyan economy as it is the single most important sector contributing approximately 25% of the GDP, and employing 75% of the national labour force. Over 80% of the Kenyan population live in the rural areas and derive their livelihoods, directly or indirectly from agriculture. Given its importance, the performance of the sector is therefore reflected in the performance of the entire economy. The development of agriculture is also important for poverty reduction since most of the vulnerable groups such as pastoralists, the landless, and subsistence farmers, also depend on agriculture as their main source of livelihood. Growth in the agriculture sector would therefore be expected to have a greater impact on a larger section of the population than that of any other sector. For this reason, the development of the sector is important for the development of the economy as a whole. Strategies and policies for agriculture consist of government plans and decisions that influence the level and stability of input and output prices, public investments affecting agricultural production, costs and revenues and allocation of resources. These policies affect agriculture either directly or indirectly. Improved agricultural production has been seen as one of the overall objectives for poverty reduction in the country. The objectives of agricultural sector strategy have been increasing agricultural growth, seen as important for increasing rural incomes and ensuring equitable distribution of national wealth. Due to limited availability of high potential land as over 80% of Kenya’s land area is etierh arid or semi-arid, it has been envisaged that increasing agricultural production will have to come from intensification of production through increased use of improved inputs and irrigation, diversification especially from low to high value crops, commercialisation of smallholder agriculture, and increased value addition through stronger linkages with other sectors. This requires well-planned and sustained investment in the sector. Agricultural strategy, policy and financing frameworks in Kenya revolve around the main goals of increasing productivity and income growth, especially for smallholders; enhanced food security and equity, emphasis on irrigation to introduce stability in agricultural output, commercialisation and intensification of production especially among small scale farmers; appropriate and participatory policy formulation and environmental sustainability. The key areas of policy concern against which policy and strategy design revolve, therefore, can be summarised as:

• Increasing agricultural productivity and incomes, especially for small-holder farmers. • Emphasis on irrigation to reduce over-reliance on rain-fed agriculture in the face of

limited high potential agricultural land. • Encouraging diversification into non-traditional agricultural commodities. • Value addition to reduce vulnerability. • Enhancing the food security and a reduction in the number of those suffering from

hunger and hence the achievement of MDGs.

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• Encouraging private-sector-led development of the sector. • Ensuring environmental sustainability.

As most agricultural production in Kenya depends upon rainfall, crop production is easily influenced by weather. The country is frequently beset by droughts and food shortages, making the development of irrigation to stabilise food production, especially rice and horticultural crops, a key issue from the standpoint of food security. Development of irrigation schemes in an effort to meet the country’s rice deficit is therefore a priority consideration within Kenya’s Vision 2030. Figure 1.1 shows agriculture’s substantial contribution to the economy, 2001-2005. The scenario in the last five years remains basically the same. Studies show that a dollar of agricultural income generates an additional $0.63 of income outside the agricultural sector, while a dollar of non-agricultural income generates only $0.23 of income in the wider economy. This and related simulations suggest that economic growth strategies for countries like Kenya should give high priority to supporting the agricultural sector.2 There is now growing agreement that agricultural growth is a key to the expansion of an entire economy. In Kenya it has been shown that multipliers from agricultural growth are three times as large as those of non-agricultural growth.3 Figure 1.1: Agriculture’s Contribution to the Kenyan Economy 2001-2005

Source: Vision 2030

2 Meijerink, G. & P. Roza. 2007. The role of agriculture in development. Markets, Chains and Sustainable Development Strategy and Policy Paper, no. 5. Stichting DLO: Wageningen. Available at: http://www.boci.wur.nl/UK/Publications/ 3 Roger D. Norton, Agricultural Development Policy: Concepts and Experiences, FAO, 2004

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It is envisaged that rice production should be mainstreamed in Africa so as to replicate the Asian green revolution in which it was the core crop and where it is now the main staple food. The CARD partners believe that there is “considerable room for Asia-Africa solidarity and partnership so that we can share our experiences and deliver the best possible outcomes for Africa’s small-holder farmers.”4 Thus CARD will contribute not only to the improvement of food security, but also to rural development and poverty alleviation in the region. CARD candidate countries were requested to prepare a National Rice Development Strategy (NRDS), wholly owned by the government, drawing on the support of the Nairobi-based CARD secretariat as necessary. Development Partners such as the World Bank, IFAD and AfDB are ready to support the commitment of countries with regard to the CARD initiative. Kenya is in the first group of pilot countries alongside Cameroon, Ghana, Guinea, Madagascar, Mali, Mozambique, Nigeria, Senegal, Sierra Leone, Tanzania and Uganda. During 2009, each selected country designed its NRDS, which is the core subject of this study. The NRDS for Kenya (and for each of these countries) has to various extents focused on the following:

• review of the national rice sector, • challenges and opportunities related to the development of the rice sector including

in-country value addition, production, marketing and trans-boundary/regional issues, • priority areas and approaches including institutional and policy aspects, • Vision and scope of the NRDS, • Strategy by sub-sector, i.e. every component of the rice value chains with human and

financial resource needs and financing sources. 1.2 Study Objectives This study was commissioned by CARD with the aim of mapping the Poverty Reduction Strategy Papers (PRSP), Sector Strategies and Policies related to Rice Development in Kenya. The general purpose of the study is to facilitate the alignment of NRDS into other Strategies/ Policies/ Programmes, PRSP, Sector-based strategies, Funding Frameworks, Comprehensive Africa Agriculture Development Programme (CAADP), and others. Specifically the study is intended:

iii) To assess the coherence and linkages between the National Rice Development Strategy (NRDS) and the relevant planning and programming frameworks including (a) Growth and Poverty Reduction Strategies or equivalent, (b) relevant Sector-Based Strategies, (c) Public expenditure frameworks at national/sector levels, (d) On-going rice related programmes/projects, and (e) Other relevant international programmes (including CAADP and NEPAD initiatives).

4 Mr. Kenzo Oshima, Senior Vice President of JICA during TICAD-IV, 2008

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iv) To provide a basis for reconciling the NRDS’s requirements (demand side) in terms of policy, institutional and investments5 measures/actions and the related opportunities (supply side) as indicated in above planning frameworks and tools.

The outcome of this initiative is to:

1. Enhance the integration of NRDS’s with the Poverty Reduction and National Development Strategies (PRS/NDS), related sector priority setting and financing processes and the four pillars of the CAADP6) – by determining their linkages.

2. Lay the ground for broader donor support which will contribute to the funding of the NRDS implementation, and

3. Contribute to ensuring the sustainability of the funding of NRDS implementation. The specific duties assigned the Kenya national consultant are:

1. Mapping of on-going or planned poverty reduction and national development strategies, sector strategies, policies, programmes, related budget processes and expenditure frameworks of direct or potential relevance to NRDS’ financing;

2. Mapping of on-going or planned frameworks of dialogue of direct or potential relevance to the NRDS’ implementation;

3. Ensuring that investments in rice value chains is mainstreamed into Kenya’s national annual budget allocations;

4. To examine how resources can be mobilized from national and external sources for investments in rice value chains;

5. To analyse the role and responsibilities of key stakeholders who can improve the status of rice value chains in Kenya’s national strategies and investments plans;

6. To reconcile the proposed demand side of Kenya’s NRDS in terms of policy, institutional and investment measures with the related opportunities (supply side) as indicated in the above planning frameworks and tools; and

7. Identify gaps between the demand and the supply side of rice development strategies in Kenya in terms of programmes, various measures or actions to be undertaken, additional financial resources, and opportunities.

1.3 Methodology The study draws from secondary and primary data sources, the latter using a questionnaire (Annex 1) and face to face discussions. Desk research sources included government ministries and agencies inter alia Ministry of Agriculture (MOA); Ministry of Trade (MOT); National Irrigation Board (NIB); Ministry of Finance; Ministry of Planning, National

5Investments refer to both human and financial resources. 6 The four pillars of CAADP are: (i) Extending the area under sustainable land management and reliable water control systems, (ii) Improving rural infrastructure and trade-related capacities for market access, (iii) Increasing food supply, reducing hunger and improving responses to food emergency crises and (iv) Improving agriculture research, technology dissemination and adoption. The Sustainable development of livestock, fisheries, and forestry resources cuts across the four CAADP pillars and is considered in FASDEP II as the fifth CAADP pillar.

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Development and Vision 2030; Lake Basin Development Authority as well as multiple data sources on the worldwide web. Interviews and stakeholder consultations were held with relevant personnel in various Government Ministries, Departments, and Agencies (mainly parastatals), private sector and non-governmental organisations involved in rice development in Kenya. A Stakeholder Workshop held at the Kenya Agricultural Research Institute (KARI) on September 16, 2010 to present and discuss the Rice Value Chain Study and the status of implementation of the NRDS provided valuable information. Inspiring contributions from government ministries, agencies, farmers and private sector rice stakeholders (millers, traders etc.) showed the great interest that exists for rice development in Kenya. They provided insightful views on how to reconcile and integrate the NRDS with relevant national development policies and strategies, and private sector activities, and offered a wide range of views on the way forward in raising Kenya’s rice production and implementing other rice development strategies.

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2. STRATEGIES, POLICIES, PROGRAMMES AND EXPENDITURE FRAMEWORKS

2.1 Kenya’s Early Strategies for Poverty Reduction and Transformation of

Agriculture This section presents a review of the Poverty Reduction Strategy Papers (PRSP) process. PRSPs are essentially about prioritising budget allocations in order to achieve poverty reduction objectives. As such, the development of PRSPs presents an important opportunity for those working for agriculture, food production and related infrastructure improvements, which historically are poorly prioritised and inadequately funded by governments, Kenya included. Kenya has a history of planning for national and agricultural development.

Immense strides were made in the development of Kenyan agriculture towards the end of colonial domination from 1945 to 1960, in three phases:

• a recovery phase 1945-50 in which major efforts were made to combat soil erosion and locusts, both of which had increased as a result of the war policy of maximum production;

• a planning phase, 1951-55, in which the well-known Swynnerton Plan for African areas, and the complementary Troup report for the European farmlands, was prepared;

• a rapid development phase, 1955-60, in which farm enterprise and production was greatly accelerated, particularly in Kikuyuland (Central Province) where land consolidation was carried out.

In summary, Kenya has had a relatively long history of planning - in the first phase the emphasis was on soil conservation and European settlement; in the second the Swynnerton Plan came into effect, with a transformation of African agriculture in the high potential areas through the consolidation of holdings, the planning of farms, the use of leys and the promotion of cash crops; in the third the resettlement of African farmers on land purchased from white settlers became the principal activity immediately after independence in 1963; and in the current phase, there have been a series of development plans and PRSPs all aimed at combating poverty and ensuring food security. A summary of the plans drawn before independence is presented in Table 2.1.

Table 2.1: Kenya Development Plans prior to Independence Year Name of plan national/strategy/programme Period Duration, yrs 1946 Report of the Development Committee 1946-1955 10 1951 Report of the Planning Committee 1951-1955 5 1955 Progress report on the three-and-a-half year development plan 1955 The development programme 1954-1957 3 1957 The development programme 1957-1960 4 1960 The development programme 1960-1963 3

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2.2 Kenya after Independence After independence in 1963 and before the current Vision 2030 was drawn, Kenya has had two long-term policies have guided and several 5-Year Development Plans:

• Sessional Paper No. 10 of 1965: African Socialism and its Application to Kenya, and • Sessional Paper No.1 of 1986: Economic Management for Renewed Growth.

These long-term vision statements attempted to confront the country’s most entrenched problems by charting a vision of how development would tackle them. They formed the basis upon which 5-year plans were developed. The performance of the economy however has had its bright and dark moments. Whereas the country’s Gross Domestic Product (GDP) grew by an average of 6 per cent over 1964-1980 and 4.1 per cent over 1980-1990, the period 1990-2002 was one of declining per capita income with an average GDP growth of 1.9 per cent against a population growth of 2.9 per cent. All sectors of the economy suffered tremendous decline. Since 2003, Kenya has made tremendous effort to get the economy back on track through the Economic Recovery Strategy (ERS – 2003-2008) with the GDP growth rate recovering to 5.8 per cent by 2005. Independent Kenya has maintained a culture of 5-year development planning as shown in Table 2.2. In addition, Kenya has wished for a long time to join the league of newly developed economies and has carried out studies to determine the path towards attaining this goal. Further, there have been repeated ethnic/tribal clashes in Kenya every time a general election approaches and this has led to international NGOs seeking to intervene and create a peaceful country where development can thrive. Two reports over these two issues are listed below. Table 2.2: Plans and other Intervention Measures in Independent Kenya to 2003 National Development Plans Year Name of plan national/strategy/programme Period Duration, yrs 1964 Development plan for the period from 1964 to 1970 1964-1970 1965 Development plan (first) for the period 1965/66-69/70 1965/66-69/70 5 1969 Development plan (second) for the period 1970-1974 1970-1974 5 1974 Development plan (third) for the period 1974-1978 1974-1978 5 1979 Development plan (fourth) for the period 1979-1983 1979-1983 5 1979 Planning for progress: Our fourth development plan 1979-

1983: A short version 1979-1983 5

1984 Development plan (fifth) for the period 1984-1988 1984-1988 5 1986 Economic management for renewed growth: Mid-term review

1986-2000 1986-2000

1988 National development plan (sixth) for the period 1989-1993 1989-1993 5 1994 National development plan (seventh) for the period 1994-1996 1994-1996 3 1996 Eighth national development plan for the period 1997-2001 1997-2001 4 2001 Interim Poverty Reduction Strategy Paper 2001-2002 2 2003 Economic Recovery Strategy Paper 2003-2008 5 1980 International Labour Office (ILO): Industrial technology for socio-economic development: Final

report of UNDP/ILO project KEN/77/011 to the Kenya National Council for Sc. & Technology 1992 Friedrich Neumann Stiftung: Blueprint for a new Kenya: Post Election Action Programme

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2.3 Advent of the PRSP and Vision 2030 The introduction of the PRSPs in 1999 promised to create concrete opportunities for national and local civil society groups to represent the interests of their constituencies at the highest level of national policy making. Never before had the role of civil society in policy making been formally legitimised in this way, nor had it attained such a high profile. However, in reality the participation processes in PRSPs have not lived up to the optimistic rhetoric. A recent report from consultant “SGTS and Associates” for the UK Department for International Development (DFID) identified that: ‘In the majority of countries, participation by civil society in the PRS process has, as yet, been limited and superficial’. Even where space was provided for civil society groups to voice their opinions, these did not have an impact on resulting policies.7 The key objectives of the PRSP are to “link policy, planning and budgeting; to attain quality expenditures and efficiency gains; to institute a harmonius financing framework for equitable distribution of national resources and development initiatives; to enhance participation and ownership in a transparent, open and accountable manner; to give a voice to the poor; and to monitor and evaluate the poverty reduction and growth strategies.”8 The principles that guide PRSPs preparation are: • country-driven, promoting national ownership of strategies through broad-based

participation of civil society; • result-oriented and focused on outcomes that will benefit the poor; • comprehensive in recognizing the multidimensional nature of poverty; • partnership-oriented, involving coordinated participation of development partners

(government, domestic stakeholders, and external donors); and • based on a long-term perspective for poverty reduction.9

Kenya has so far recorded three PRSP milestones – Table 2.3 – and each Medium Term Plan after 2008 will be guided by the long-term “Vision 2030” blueprint (2008-2030). Table 2.3: Plans under PRSP Scheme Year Name of plan national/strategy/programme Period Duration, yrs 2000 Interim Poverty Reduction Strategy Paper (IPRSP) 2000–2003 4 2003 Economic Recovery Strategy For Wealth and Employment

Creation (ERSWEC also called ERS) and its companying Investment Programme 2003-2007, (March 12, 2004 (Revised))

2003-2007

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2008 First Medium Term Plan 2008-2012 5

7 Belinda Calaguas and Mary O’Connell (2005), Poverty Reduction Strategy Papers and Water: Failing the poor? Discussion Paper, WaterAid 8 International Monetary Fund (December 2003), Kenya: Poverty Reduction Strategy Paper Preparation Status Report, IMF Country Report No. 03/394 9 International Monetary Fund, PRSP Factsheet, September 2010

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The IPRSP drawn under a previous government regime was never submitted for IMF Joint Staff Assessment (JSA). However, after the change of government in 2002, it was used to draw the 2003 ERS which outlined the key aspirations for its economic and social programme for 2003-07. The focus of the 2003 ERS was how to stimulate economic growth, create employment and reduce poverty. The JSA of the IPRSP (2000) raised the following issues relevant to this study among others: • The importance of strengthening socio-economic statistics so as to strengthen poverty

analysis, diagnose more accurately causes of poverty, and monitor the effectiveness of poverty reduction programmes;

• The need to fully articulate supply-side measures to achive the medium-term growth objectives;

• The needd to deepen the consultation process; and • The importance of prioritizing expenditure, costing of identified poverty programmes,

strengthening the links between poverty reduction objectives and proposed policies, and incorporating them into the macro-economic framework; ... the importance of restructuring government expenditures to make room for spending in priority sectors (such as agriculture).

These considerations have direct relevance to rice development. Interventions proposed for agriculture in the ERS that followed the PRSP Status Report were to: • Provide one enabling legislation, and empower poor farmers through increased

smallholder access to credit, increased institutional efficiency and strengthened extension services, and

• Revamp the cooperative movement by reviewing the Cooperative Societies Act so as to improve governance in the sector.

The latter was particularly pertinent to rice development as at that time (1998-99), there was a major tussle between Mwea Irrigation Scheme farmers’ cooperative society and the NIB whose eventual conclusion was the removal of management of production operations from the hands of the NIB. Soon after, extension services, farm input supply, milling and marketing fell into the hands of the farmers with the result that scheme production and farmer incomes declined markedly. This report will now confine itself to the First Medium Term Plan (FMTP) 2008-2012 which has already been approved by the IMF and the WB and is under implementation. Once a PRSP is approved by the IMF and the WB, it provides the basis for negotiations and agreements among the participating stakeholders on the planning and implementation of poverty interventions in a country. One such intervention is enhancement of rice production and improvement of investment in the rice value chain with a view to enhancing farmer incomes and improving food security. The PRSP provides the centerpiece of policy as well as funding and resource allocation dialogue within the government and between stakeholders.

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Initially (in the 2000 IPRSP) agriculture and rural development emerged as the highest priority nationally followed by human resources development, physical infrastructure and trade all of which are relevant to rice development. The people indicated that over the years growth in agriculture had slowed down significantly and this was one major contributor to the rising poverty levels. The Kenyan PRSP process itself also had a number of incarnations. The Interim Poverty Reduction Strategy Paper (IPRSP) released in 2001, involved only limited consultations at the national level. Subsequently, consultations followed a three-tier approach at the national, provincial and district levels with stakeholders that included the Private Sector, Civil Society, Development Partners and local communities. This approach led to the formation of a National Steering Committee of stakeholders charged with the responsibility of spearheading consultations and ensuring inclusion at all levels. The consultations went down to the divisions, locations and villages. Civil society organisations contributed their views during the planning and priority setting stages of the PRSP. Special groups advocated for the inclusion of project activities that would assist in the well being of vulnerable groups. The initial focus was the development of inter-sectoral objectives and implementation methods that integrated the interests of various groups. However, it appears that the rice subsector could not be adequately addressed as civil society organisations (particularly rice cooperatives) did not have strong representation and had not been working in close collaboration with each other in a systematic way. Table 2.4 indicates the ranking of agricultural subsectors and the major constraints identified in them in the PRSP, and which are still evident in Kenya today. Table 2.4: FMTP (2008-2012) Agricultural Subsector Major Constraints

Agricultural Subsector Major constraints Crop development • Poor extension services

• Inefficient rural finance and credit system • Poor rural infrastructure • Poor marketing and distribution

Rural Water • Shortage of water supply • Poor management of water resources • Destruction of river catchments

Livestock development • Livestock diseases • Poor livestock marketing • Poor extension services

Food security • Prevalence of drought and food shortages Lands and settlements • Poor land policy and legal framework

• Negative cultural practices in relation to ownership of land by women

Source: FMTP, 2008 Under the Vision 2030, Kenya has proposed projects that will be implemented through five-year plans with the First Medium Term Plan (FMTP) running from 2008 to 2012 and replacing the Economic Recovery Strategy that expired in 2008. In the ERS phase of Kenya’s

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development (2003-2008), the agriculture sector growth improved markedly from negative 3% in 2002 when a new political order replaced a single party system government to a positive 5.4% in 2006. Similarly, the manufacturing sector expanded by 6.9% in 2006, up from 0.1% in 2002. Other than livestock development, the other subsectors are of direct relevance to rice development and the funding arrangements to mitigate their constraints should contribute directly to rice development. The emphasis on agriculture has now shifted and the highest priority in the FMTP is given to human resource development, physical infrastructure, and agriculture and rural development in that order. Physical infrastructure includes rural roads that are crucial to the efficient delivery of farm inputs and marketing of produce including rice. The FMTP carries over ERS subsectors as shown in Table 2.5. Table 2.5: ERS Strategies for Agricultural Development

Agriculture Subsector ERS Component Crop development • Research and extension services

• Access to credit • Diversification of enterprises and crop uses • Cooperative development • Value addition • Guaranteed minimum returns • Physical infrastructure development

Rural Water • Water and sanitation development Livestock development • Development of agriculture, livestock and fishing

• Food and nutrition • Development of arid and semi-arid lands

Food security • Prevalence of drought and food shortages Lands and settlements • Land administration and survey

• Land tenure in arid and semi-arid lands Source: ERS, 2003 In the 2005 PRSP it was targeted to raise the yields of major crops by 5% through breeding programmes, widespread accessibility to farm inputs and efficient extension services. The government further intended to support plans for rehabilitation and development of irrigation systems to support the revitalization of cotton and rice sectors.10 This was principally in reference to rehabilitation of Bura (cotton) and Ahero (rice) irrigation schemes both of which are now back in partial production. Overall, the aim of Vision 2030 is to transform the socio-economic structure from a situation where agriculture still accounts for 23 per cent of GDP and 56 per cent of employment while manufacturing accounts for barely 9.9 per cent of GDP and less than 2 per cent of employment. Services account for the bulk of economic activity at 51.6 per cent of GDP constituted mainly by informal sector activities.

10 IMF Country Report No. 05/11

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A large part of the financing of the infrastructure and projects scheduled for implementation under the FMTP 2008-2012 is expected to come from the private sector in the form of both local and Foreign Direct Investment (FDI). This is expected to be attracted by a vibrant, profitable and peaceful economy where the cost of doing business will have been reduced considerably with the implementation of wide-sweeping planned reforms under the recently promulgated new constitution.11 Today the government recognizes that the sector that would revive the economy is the physical infrastructure sector and also recognizes the need to identify with the PRSP priorities of agriculture and human resource development. Towards meeting basic needs, the government has developed an investment programme that will lead to growth in employment and reduction of poverty. The MTP addresses food crops classified into: cereals (maize, wheat, sorghum, rice, millet); pulses; and others. Most of these food crops have recorded increased production since 2002, with maize production increasing from 2.4 million tons in 2002 to 3.2 million tons in 2006. Production of rice increased from 40,498 tonnes in 2003 to 64,840 tonnes in 2006 (with about 80% of this production coming from Mwea Irrigation Scheme). The increase in rice production was attributed to expansion of rice production in Mwea, Yala and Bunyala Irrigation Schemes and revival of Ahero Irrigation Scheme. Access to financial services by farmers has increased significantly over the years as supported by data from financial institutions: banks, the Agricultural Finance Corporation (AFC) and Savings and Credit Cooperative Organisations (SACCO) which mobilise huge financial resources some of which are directed towards agriculture activities. Following its revival, the AFC has increased its loan disbursement to farmers from KShs 90.7 million in 2002/03 to KShs 1.79 billion in 2006/07. This is of direct potential to rice production as farmers can obtain seasonal loans repayable upon sale of produce at harvest. The FMTP states that it is estimated that intensified irrigation can increase agricultural productivity four-fold and depending on the crop, incomes can be grown ten-times. Experience from other countries shows irrigation is a major driver of agricultural productivity. In recognition of this, the government has elevated the importance of irrigation by creating a Ministry of Water and Irrigation. Some water deficit countries (notably Egypt and Israel) have proved that co-ordinated development and utilisation of irrigation does transform economic development. There is a strong drive towards promoting irrigated agricultural production in the FMTP for both food and cash crops. Funding of irrigation and drainage has continued to grow over the period 2003-2007. As a result, most of the districts have implemented an average of two projects per year. For example, 87 new schemes were constructed increasing the area under irrigation by 8,200 hectares, 16 irrigation schemes rehabilitated, 131 new irrigation and drainage schemes identified, 12,409 irrigation farmers trained on irrigation water management, and 105 Water Users’ Associations (WUAs) formed. All this is directly relevant to rice development.

11 Government of the Republic of Kenya (2008), PRSP First Medium Term Plan, 2008 – 2012

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Following the strengthening of agricultural extension service delivery the number of farmers reached per year increased from 1.0 million in 2003 to 2.1 million in 2007. Over the MTP period, measures will be taken to revamp the key extension institutions of Agricultural Training Centres (ATCs) and Agricultural Mechanisation Stations (AMSs) through rehabilitation and upgrading of facilities and equipment. Since 1999 when the NIB and Mwea farmers disagreed over the costs charged by the former for their supplies and services, extension services in Mwea have experienced a steady decline. Neglect of water delivery and reticulation structures led to heavy water losses and a severe shortage resulted in water theft illegal diversions and a decline in hectarages planted. A revamped extension service should remedy this situation and lead to smoother production arrangements. It is envisaged that Mwea soon go back to the 1980s practice of double-cropping (i.e. two rice crops per year). The FMTP is emphatic on the use of inputs such as fertilisers and purchased (certified) seed. The annual fertiliser demand increased from 329,449 tons in 2002/03 to 410,214 tonnes in 2006/07. Production of certified seeds for various crops increased from 12,998 tons in 2002 to 34,682 tonnes in 2006. The volume of imported seeds increased from 1,217 tons to 4,773 tons over the same period, respectively. Prices of inputs increased steadily during the same period negatively affecting the returns to farmers. The use of NPK fertilisers for planting and Urea for topdressing are common practices in Kenya. The government has declared its commitment towards ensuring that certified seed is produced by governmental entities where this is unable to attract commercial seed farmers.

Process of implementation of the PRSP Proposals made in the PRSP are implemented through the normal government process of planning, budgeting, release of funds to ministries where the Permanent Secretary is the key accounting officer, departments and other holders of Authority to Incur Expenditure (AIE). Budgeted estimates are officially printed and these Printed Estimates form the basis of spending for the Financial Year. An AIE holder running a project/programme then applies released funds to the implementation of approved activities in the Annual Work Plan and Budget (AW&B) used to initially forward the estimates to the Ministry of Finance for budget allocation. Preparation of annual work plans as well as new projects and programmes must address specific aspects of the PRSP. A monitoring and evaluation process on the application of funds and achievements of project/programme targets is then used to ensure that funds are spent in accordance with the AW&B. At the end of the Financial Year an audit confirms the year’s expenditure and reports on conformity with government expenditure guidelines. Key Stakeholder roles and responsibilities In Kenya the PRSP is purely a government process – created, implemented and monitored by, and funded through the government. Using guidance given in suggestions of what should be done by the PRSP, civil society organisations may propose projects through line ministries as described in the PRSP. The role of these civil society organisations has been improved by the allocation of funds to constituencies through the Constituency Development Fund (CDF). Thus, it will be possible for the rice sector to claim a share of the funding from the treasury so

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long as it proposes relevant projects targeted at developing the rice industry which are approved through the CDF process. Key stakeholders in the PRSP and their roles (Figure 2.1) are as follows:

• government ministries, • development partners involved in funding of government programmes, projects and

giving other forms of support such as facilitation, technical assistance, policy advice, and aid coordination, and

• civil society organisations and the private sector. Figure 2.1: Framework of the Role of Development Partners in the PRSP

Source: Kiringai, Jane and D. K. Manda12

Conditionality imposed on borrowing for both sector finance and general budget support The experience with structural lending revealed the ineffectiveness of ex ante conditionality where aid was contingent on promises of reform. In the 1990s ex post conditionality was proposed as an alternative. Under ex post conditionality (sometimes called results-based or performance-based aid) the amount of aid depends in a previously agreed way on progress realised over a given period and measured by an agreed set of indicators.13 On the advent of the PRSP in 1999, instead of imposing conditionality and demanding policy alignment from recipient countries, donors were expected to draw their conditionality from a

12 Kiringai, Jane and D. K. Manda, (2002), The PRSP Process in Kenya, Second Meeting of the African Learning Group on the Poverty Reduction Strategy Papers (PRSP-LG), 18-21 November 2002, Brussels, Belgium. 13 Jan Willem Gunning, Budget Support, Conditionality and Impact Evaluation, Practitioners’Forum on Budget Support, May 5-6, 2005 Cape Town, South Africa.

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comprehensive, nationally elaborated strategy on development and poverty reduction. Previous policy-based lending instruments had focused on external and internal macroeconomic reform with specific conditionality focused on deregulation, privatization, and macroeconomic variables such as inflation and public sector deficits. The IMF as well as the WB had earlier based their conditionality on the so-called Policy Framework Paper (PFP), which – as admitted by the IMF in 2002 – had primarily been a product of the Bank and the Fund. It has been proposed that instead the budget-support programme should be aligned with an operationalized version of the PRSP. Its conditionality should relate to the government’s performance on service delivery to the poor. In addition, albeit to a lesser extent, conditionality is expected to aim at macroeconomic stability for the attainment of poverty reduction through enhanced economic growth.14 Over the last twenty years, Kenya has followed an economic regime of deregulation, privatization and macroeconomic practices that have been mildly effective in controlling inflation though not particularly effective in controlling public sector deficits. These deficits have been financed mainly through local borrowing using various Central Bank finance instruments. With the completion and operationalization of the first PRSP in 2003, Kenya satisfies the minimum conditionality for budget support. The funding process The Institute of Economic Affairs observes that “one of the key challenges facing the agriculture sector is under-funding. The Ministry of Agriculture budgetary allocations for 2009/10 is under 5% of the total budget and the under-funding aspect is confirmed by the request for additional funds amounting to KShs.3.2 billion of development budget during 2008/09 revised budget, albeit a substantial sum going towards purchase of grains during shortfalls in 2008. Equally, Parliament needs to exercise its oversight on the implementation of the above planned Programme on food security by monitoring implementation against set targets and timelines.”15 In spite of this however, the PRSP proposes ingenious ways of funding its activities as presented in the discussion below which consists of excerpts lifted from the PRSP. Implementation of the MTP 2008-2012 will require significant resources such that even after aligning the funding requirements for implementing the identified strategic thrusts with the MTEF budget, wide gaps still remain. The foreseen sources of funds are as follows: • Government Funding: With regard to government funding, the sector will prepare its annual Public Expenditure Review (PER) reports to form the basis for resource bidding under the overall MTEF budgetary process. In this regard, all the sector members will be involved in the budget process to ensure that the annual ministerial PERs and sector reports

14 Martin Knoll, United Nations Conference on Trade and Development, Budget Support: A Reformed Approach or Old Wine in New Skins? Discussion paper No. 190, October 2008. (There are recorded cases of an uncoordinated multiplicity of donor conditionalities that have impeded disbursement of budget support funding calling for greater donor conditionality harmonization.) 15 Institute of Economic Affairs, (June 2009), Budget 2009/2010, A Guide for MPs

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accommodate their respective needs. It should therefore be the responsibility of the Ministry of Agriculture to ensure that due attention is paid to funding for rice development. • The Kenyan National STI Fund: The objective of the Science, Technology and Innovations fund is to secure adequate local and international funding in support of the national Science, Technology and Innovation sector Medium-Term Plan. The fund is formulated as a general national fund with a framework that allows for the creation of various specific funds to meet specific funding needs in the STI sectors. This includes infrastructure development, applied research (such as crop variety trials), and innovation support among others. • Venture Capital: The private sector will be targeted to provide capital to bridge the gaps in Science and Technology as well as financing innovation programmes. The macroeconomic environment for attraction and growth of venture capital will also be created. In addition, the financial services sector will be strengthened and focused to support the growth of venture capital. The programme will also focus on public – private STI funding as well as general financing of STI initiatives. • Development Partners: Development partners are currently supporting the government in some of the initiatives outlined in the MTP. The sector therefore plans to engage their support to fill in the resource gap between the MTEF budget and Medium-Term Plan budget. The relationship between the sector and the development partners will be strengthened by developing strategic alliances based on the needs and policy direction of the Vision 2030. Subsequently, the development partners will form a Joint Financing framework that will fund the implementation of the projects and programmes. 2.4 Sector-based Policies, Programmes and Strategies 2.4.1 Overview of the Agriculture Sector All government programmes, project, and strategies related to the agriculture sector are prepared and implemented by the Ministry of Agriculture (MOA). It is the lead ministry responsible for policy, planning, and implementation for the agriculture sector within the context of a coordinated government setting. MOFA also collaborates with development and donor partners to achieve policy objectives in the agriculture sector. The development strategies and policies drawn and the plans and programmes/projects undertaken by the MOA are presented below. The following agricultural policies, strategies and programmes have played key roles in transforming Kenyan agriculture over the years:

i) Swynnerton Plan ii) Agricultural Sector Development Strategy (ASDS) iii) Strategy for Revitalization of Agriculture (SRA) iv) The Kenya CAADP Compact

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v) National Rice Development Strategy (NRDS) These are discussed with emphasis on their role for rice development in Kenya. 2.4.2 The Swynnerton Plan One of the earlest cases of a comprehensive agricultural strategy in Kenya was the Swynnerton Plan which was a colonial agricultural policy that appeared as a government report in 1954, aiming to intensify the development of agricultural practice in the then colony. The plan was geared to expanding native Kenyan's cash-crop production through improved markets and infrastructure, the distribution of appropriate inputs, and the gradual consolidation and enclosure of land holdings.

The main objective of the plan was to create family holdings large enough to keep the family self-sufficient in food and also enable them to practise alternate husbandry and thus develop a cash income. It was envisioned that 600,000 African families would have farming units of approximately ten acres (4 ha) a family, which would raise their average productivity in cash sales from ₤10 to ₤100 a year after providing for their own needs. In drawing up his 5-year plan, Swynnerton assumed twenty years would be needed to fully implement it.

The plan recommended that all high-quality native land be surveyed and enclosed; that the policy of maintaining 'traditional' or tribal systems of land tenure be reversed; and all the thousands of fragmented holdings be consolidated and enclosed. The 'progressive' farmers would thereby be able to obtain credit, which had been previously denied them, whilst the new title deeds would create security of tenure which would lead to investment and rural development. Furthermore, it recommended that native African farmers be allowed to grow cash crops, be given a major increase in technical assistance, and have access to all marketing facilities, all of which were previously available and restricted to the white settler minority.

The results were dramatic: the value of recorded output from the small-holdings rose from ₤5.2 million in 1955 to ₤14 million in 1964, coffee accounting for 55 per cent of the increase.

In 1960 there was a political change of heart which resulted in the discouragement of European settlement; but these plans are still broadly the basis of agricultural policy in Kenya. On the whole, it was a period of advance, slowed and impeded by political opposition as Kenya fought for her independence, but nevertheless resulting in marked material benefits and, in the research field, providing the basic knowledge for more spectacular advances.

2.4.3 Agricultural Sector Development Strategy (ASDS) The ASDS 2010-2020, (2010), is the successor to the Strategy for Revitalisation of Agriculture (SRA) (2004) which saw growth in the agricultural sector surpass the projected 3.1% p.a. and attain 6.1% in 2007 its anticipated final year. The ASDS is anchored on two strategic thrusts:

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• increasing productivity, commercialization and competitiveness of agricultural commodities and enterprises

• developing and managing key factors of production. Assuming a conducive external environment and support from enabling sectors and factors, the ASDS has set the following targets to be achieved by the agricultural sector by 2015 among others:

• Reduced food insecurity by 30 per cent to surpass the MDGs. • Increased contribution of agriculture to the GDP by more than KES 80 billion per year as

set out in Vision 2030. • Divest from all state corporations handling production, processing and marketing that

can be better done by the private sector. • Reformed and streamlined agricultural services such as in research, extension,

training and regulatory institutions to make them effective and efficient. The ASDS is implemented through District Agricultural Development Committees (DADC) made up of the sector ministries and stakeholders. Priorities on implementation are agreed upon at district development committees and DADCs, as well as at constituency development committees. It recognizes the following challenges and constraints (ASDS, p.24ff) which are of direct relevance to rice development:

• Inadequate budgetary allocation: Insufficient budgetary allocation to the agricultural sector is a key constraint. In 2003 under the Maputo Declaration, African Heads of State committed to allocate 10 per cent of their annual budgets to the agricultural sector. Kenya has not yet achieved this target; by 2008, the sector was receiving 4.5 per cent of the budget. This insufficient allocation has reduced human resources and service delivery by Government institutions.

• Reduced effectiveness of extension services: The effectiveness of extension

services declined over the last two decades due to use of inappropriate methods and a sharp reduction in operational budgets and human resources in the sector ministries. In particular, livestock extension in ASALs has been underfinanced. While much has been achieved in the last 5 years, inadequate financial and human resources continue to constrain the sector.

• Low absorption of modern technology: Although Kenya has a well-developed

agricultural research system, use of modern science and technology in agricultural production is still limited. Inadequate research–extension–farmer linkages to facilitate demand-driven research and increased use of improved technologies continue to constrain efforts to increase agricultural productivity.

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• High cost and increased adulteration of key inputs: The cost of key inputs such as seed, pesticides, fertilizer, drugs and vaccines is high for resource-poor farmers. Such high costs lead to low application and adulteration of inputs.

• Limited capital and access to affordable credit: Farming is considered highly risky

by the formal banking sector, thus it gives farming little attention. Without credit farmers are hard-pressed to finance inputs and capital investment. A number of microfinance institutions are operating but they tend to increase the cost of credit, reach only a small proportion of smallholder farmers, and provide only short-term credit. The formal banking system is just beginning to develop credit facilities particularly suited to small-scale farming.

• Pre- and post-harvest crop losses: There have been high levels of waste due to pre-

and post-harvest losses occasioned by pests and diseases, and lack of proper handling and storage facilities. Smallholder farmers are unable to control pests and diseases due mainly to lack of information.

• Low and declining soil fertility: The rising population density has contributed to the

subdivision of land to uneconomically small units. Moreover, reducing fallow periods and continuous cultivation have led to rapid depletion of soil nutrients, declining yields and environmental degradation.

• Inadequate disaster preparedness and response: There is low preparedness,

response capacity and coping mechanisms in the event of disasters such as drought, floods, fires, diseases and pests. Early warning and response systems need to be strengthened and widened.

• Multiple taxes: As they transport or market their farm produce, farmers have been

subjected to multiple taxes from local authorities and Government departments. This has contributed to reduced net farm income and created distortions in marketing structures without necessarily improving the services that these authorities are supposed to deliver.

• Inadequate infrastructure: Poor rural roads and other key physical infrastructure

have led to high transportation costs for agricultural inputs and products. This has reduced farmers’ ability to compete. In addition, electricity in rural areas is often not available or is expensive, leading to reduced investment especially in cold storage facilities, irrigation and processing of farm produce.

• Insufficient water storage infrastructure: The high variability of floods and

droughts is likely to increase with global climate change. Water harvesting and storage infrastructure need to be expanded to store the run-off for livestock watering points, irrigated agriculture and fish farming.

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• Inadequate storage and processing facilities: Inadequate storage facilities constrain marketability of perishable goods such as fish, dairy products, beef and vegetables. Lack of fish-processing facilities close to Lake Victoria and the coastal area (Mombasa) has limited the extent of exploiting fish resources.

• Inadequate markets and marketing infrastructure: While Kenya’s agriculture is

better developed than that of most countries in Sub-Saharan Africa, the domestic market is too poorly organized to take advantage of the regional market. The local marketing information system has recently been established but has not been well utilized.

These are the areas where efforts should be targeted in order to develop rice in Kenya. In spite of these challenges and constraints however, Kenya has many opportunities and advantages that can be exploited to build a robust and dynamic agricultural sector including:

• Abundant human resources: Kenya is endowed with a massive but underused human resource capacity. Primary, secondary and post-secondary education has expanded and produces thousands of graduates each year. This resource can be used to change the face of agriculture in training and research to develop new and relevant technologies, and to create and expand agribusiness.

• New and expanding markets: Kenya is uniquely placed to take advantage of

expanding domestic, regional and international markets. Due to the diverse agro-ecology, the country can produce a wide range of temperate, tropical and subtropical products. Large and expanding markets for traditional products like maize and other cereals, beef and dairy products, tea, coffee and pyrethrum exist.

• Potential for increasing production: Not much effort has been put to increasing

production of traditional commodities in Kenya. Agricultural productivity can be increased in multiples through better use of unused land in traditional farming areas, and through irrigated agriculture.

• Vast irrigation potential: Kenya’s irrigation potential is estimated at 540,000 ha of

which only about 105,000 ha is exploited. The potential for exploiting irrigation can be expanded by 1 million ha by developing the Tana and Athi river basins. Lake Victoria has a 253-km shoreline in Kenya that is basically unused despite the huge irrigation potential.

• Potential for increasing yields: Yields of crops and livestock are far below their

optimum. Yields of maize, sugar and dairy are one-tenth of global potential. Rice yields are also way below potential, a situation that can be remedied by observing appropriate planting, fertilizer application and other cultural practices.

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• Value addition: Value addition includes processing, branding, quality certification and accreditation, as well as farm-level quality improvements that the market values. It is estimated that 91 per cent of total agricultural exports are in raw or semi-processed form. Thus, the country loses billions in earnings by not adding value to its produce.

Given the challenges and constraints facing agriculture and agricultural potential and the available and emerging opportunities, the strategic issues analysed in Table .... are the main target of the ASDS: *This is in line with the Government’s vision as set out in the SRA which the ASDS succeeded:

The SRA set out the Government’s vision: To transform Kenya’s agriculture into a profitable, commercially oriented and internationally and regionally competitive economic activity that provides high quality, gainful employment to Kenyans.16

Flagship projects identified in the PRSP-Vision 2030 will be implemented including expanding the schemes in Ahero (rice), Bunyala (rice), Bura (cotton, maize), Ewaso Ng’iro (horticulture), North Hola (rice), Kerio Valley (horticulture), Mwea (rice), Ngurumani (horticulture), Perkerra (food crops), Tana (rice, sugarcane), Taita Taveta (food crops) and West Kano (rice). Key stakeholders will implement the ASDS in a sector-wide approach (SWAP) in which sector ministries, the private sector and development partners will each have distinct roles to play coordinated by the Agricultural Sector Coordination Unit (ASCU). Each sector ministry will work out the activities under its dockets and make elaborate financing plans as part of the medium-term plans, which will be funded by the Government of Kenya, development partners and the private sector. Implementation will be carried out through the medium-term expenditure framework (MTEF) of financial allocation by Treasury. The expenditure frameworks and the medium-term plans will be harmonized with the respective development documents currently being implemented by the Planning and Finance ministries to align them with Vision 2030 and other Government development plans. The strategy implementation framework is divided into medium-term plans covering the period 2010–2015 in line with Vision 2030 medium-term plan, and 2016–2020. Key stakeholder roles ASCU will link the sector players and provide an enabling environment for sector-wide consultations along the various levels of implementation, from the division to district to national level. ASCU will not be involved in the actual implementation of the strategy. However, it shall coordinate budgeting within the sector, and participate in the review of subsector strategic and annual work plans to ensure they conform to ASDS, Vision 2030, the MDGs and other Government development agenda. 16 Republic of Kenya, SRA Final p. xii

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Specifically, ASCU role is to coordinate thematic working groups which include members from the private sector, NGOs and universities, directors / senior Government officers from the sector ministries and development partners to:

• drive reforms in the sector and fast-track implementation of the ASDS in a coordinated manner across sector ministries and other partners

• be the referral centre for reforms, and collect, analyse and disseminate information on agricultural reforms

• influence sector resource allocation to areas of highest impact • initiate major studies and policy developments within the agricultural sector • be a centre for capacity building for all stakeholders involved or affected by the

agricultural reform process • monitor implementation of ASDS activities.

Private sector organisations are organised through the Kenya Private Sector Alliance (KEPSA) and the main ones in agriculture include Kenya National Federation of Agricultural Producers (KENFAP) and Kenya National Federation of Cooperatives (KNFC), which handles the commercial arm of agriculture through the cooperative movement. Kenya is a member of regional and continental cooperation bodies such as the East African Community (EAC) and the Common Market for Eastern and Southern Africa (COMESA). These bodies provide opportunities for expanding Kenya’s markets for goods and services. The New Partnership for Africa’s Development (NEPAD) and the launching in Kenya of the Comprehensive African Agricultural Development Programme (CAADP) in 2006, a common strategic framework for agricultural policy development in Africa, are important initiatives. Kenya fully adheres to the CAADP principles and signed the CAADP Compact in July 2010; ASDS is Kenya’s tool to achieve its own version of CAADP. Funding strategies The government’s own resources are now financing over 90% of the agricultural budget. However, bilateral and multilateral development partners have for many years financed Kenya’s agricultural budget and they continue to do so particularly in spearheading new initiatives such as those supported by JICA (e.g. Mwea Irrigation Project) and partners, and carrying out pilot projects. An essential component of the ASDS is to enhance the capacity of the private and public sectors in agriculture through supporting innovative private sector activities or public–private partnerships that promote market-driven production, processing and marketing initiatives. This support will be actualized through the establishment of an Innovation Fund for Agriculture and Agribusiness (IFAA). The objective of the Fund will be to foster ASDS’s central objective of commercializing agriculture by catalyzing private sector participation in market-oriented production and service delivery, promoting productivity and profitability or commercial viability of sector activities at all levels of the wider agricultural sector value chains.

23

The Fund will offer grants targeted at the semi-commercial agribusiness or transitory level actors: farmers, traders, processors, traders, agribusiness service providers. For purposes of the fund, semi-commercial enterprise is defined as ‘a business enterprise that is producing or offering a product or service for sale and fully for profit and or is at below the desired or optimum level of operation, but at the same time is neither capable of injecting all of the required additional resources / capital from own sources nor has the capacity to acquire required additional resources / capital from commercial sources. Many of the small scale rice processors would fall under this category. Although the Government has increased the agricultural sector budget, it is unlikely to result in more investment in the sector. An agricultural development fund will be established and operationalised as a new mechanism for investing in the agricultural sector. It is anticipated that the fund will focus on strategic issues and areas stipulated in Vision 2030. The fund will cover areas that are outside the budgetary provisions of the mainstream sector ministries that are priority and offer high rates of return to investment. 2.4.4 National Rice Development Strategy Rice is Kenya’s third ranked staple food after maize and wheat. Its rate of consumption has been growing rapidly especially in urban areas. Local annual production is estimated at 35,000-50,000 metric tonnes (MT) while consumption is estimated to be 180,000-250,000 MT with the difference supplied through imports. Kenya therefore imports nearly 86 percent of her needs and a 2008 outbreak of rice blast destroyed more than 2,000 hectares (ha) of the crop under cultivation in Kenya’s main rice growing areas17. The National Irrigation Board (NIB) has managed all the larger rice schemes in the country with extension services, provision of inputs, and rice milling and marketing since its creation in the late 1960s. The National Cereals and Produce Board (NCPB) has been involved in the sale of rice since its creation and in the milling of paddy from the 2003/2004 fiscal year. These and other governmental and private organizations play a key role in the rive value chain. Rice is produced mainly in Mwea, Ahero and Bunyala irrigation schemes – the traditional large rice producing schemes for the last forty years.18 Recently trials and dissemination of upland and lowland rain-fed NERICA rice have spread rice to more parts of Kenya. Rice in Kenya is commonly consumed in urban areas but is much too costly for regular consumption by the majority of the rural population; here it is a delicacy consumed during weddings, birthdays, Christmas, and other festivities.

17 Henry Ekwuruke, “Coalition for African Rice Development launched”, AfricaFront.com, May 31, 2008 18 NCPB at http://www.ncpb.co.ke/index.php?option=com_content&task=view&id=31&Itemid=46 (visited 2.10.2010)

24

The NRDS together with its Implementation Framework were launched in November 2009. It identifies the main challenges that face the rice sector in Kenya and which must be addressed with urgency as the following among others:

• Inadequate irrigation infrastructure • Inadequate water for irrigation • Diseases such as blast • Poor quality seeds (uncertified) • An unorganised seed and input supply system • Poor understanding of rice culture • Uncoordinated markets • Access to affordable credit and • Weak farmer institutions.

These have been addressed in Section 3 below where potential solutions and status in the implementation of actions have been presented. The NRDS also recognises the great potential for rice development that exists in Kenya supported by the strong research capacity provided by the Kenya Agricultural Research Institute and the MOA’s extension capacity. Process of implementation Whereas the NRDS implementation framework specifies what needs to be done to address the above difficulties, including broad timelines and estimated budget, it does not indicate any sources of funds. Discussions with government personnel reveal that they expect funding to come from “government and donors”. Without designing specific projects to attract partner funding, it can only be assumed that the bulk of the funding should come from the government through the normal planning and budgetary process. To improve on the possible participation of the development partner community, the MOA’s Rice Promotion Unit (RIPU) is in the process of completing a “Roadmap to Increase Rice in Kenya”. The roadmap elaborates on the implementation framework addressing specific aspects that will lead to increase of rice production from 73,141 MT in 2008 to 178,580 MT by 2018, an increase of 144%. The vehicle for this implementation should be design and implementation of appropriate programmes and projects as summarised in the model example in Figure 2. Each project or programme must aim to raise production by the projected 144% or higher but, depending on implementation conditions, this might not always be possible to attain the targeted level.

25

Figure 2.2: NRDS Implementation Framework Roadmap (Source: Rice Promotion Unit, MOA)

It is proposed that programmes and projects should be selected immediately by suitable technical committees and should address the key national level areas that will result in maximum increase in productivity and production which are:

1. Research (cultivation, pest control, mechanization, post harvest loss, etc.)

2. Breeding 3. Seed Production 4. Extension 5. Market information 6. Storage and processing 7. Micro finance and seasonal credit

Examples of possible projects are:

1. Research on cultivation methods for yield increase and market competitiveness.

2. Mechanization e.g. of land preparation, weeding, threshing and winnowing, milling. 3. Seed production system for expansion of planted hectarage. 4. Dissemination of NERICA.

Area-wise or district-wise projects can be started for:

• Bunyala – increase land planted from the current 292 ha to 6,000 ha through an out-grower system.

• Ahero – increase area planted from 860 ha to 3,000 ha as indicated in the Water Master Plan of the Ministry of Water and Irrigation (MWI)

• Taveta – Introduce suitable varieties for the 480 ha of available land in a swampy area half of which is planted to rice every year.

• Tana Delta Irrigation Project – exploit the available potential of 1,763 ha that was rendered useless by floods in 1997.

The roadmap proposes that for effective design, planning and implementation of the projects, the logframe approach (project development matrix - PDM) must be applied. In summary then, the roadmap, to be revised with every new project:

26

• is a supplement of NRDS and its Implementation Framework to achieve the projection of 178,580 tons of rice production by 2018

• tries to guide where and how rice could be increased • is itself not a proposal of any project, but it encourages stakeholders (MoA, MWI,

KARI, NIB, TARDA, PDAs, DAOs, and etc.) to formulate realistic, efficient and effective projects as many as possible

• shows how to compose a project in national as well as district levels • Although rehabilitation and new construction of big irrigation facilities is most

effective way to increase rice, those projects may be considered in long term strategy beyond 2018. Therefore, the roadmap consists of projects viewed in the short- and medium-term strategy only

• Must consider dissemination of NERICA, as one of the projects as this would play a key role in increasing rice production towards 2018 and beyond. It proposes a unified and simplified seed production system of NERICA as shown in Figure 2.3. Figure 2.3: Proposed Rice Seed Production System

Source: MOA/RIPU Key stakeholder roles The anticipated stakeholder roles in the implementation of the NRDS are inter alia:

• JICA – funding and technical support • KEPHIS – inspection of foundation seed, stock seed and certified seed • KARI – Produce Breeders seed, Foundation seed and Stock seed • MOA/RIPU – Overall coordination, funding and farm level activities • NIB, TARDA, LBDA and other regional bodies – execution of own rice projects • MIAD – study for introduction of power tiller and demonstrations

Figure 1 Provisional Seed Production and Inspection Flow (NERICA Varieties)

Ministryof

Agriculture

DAO Extension Officers

KARI Breeders

Seed Companies &

MIAD

KEPHIS

Association

Farmers

Certified Seed

Farmer's Demand of NERICA Seed is conveyed to MoA

* MoA supervises KARI for seed requirements in next eight years

* KARI plans and produces Breeder's seeds, Pre-Basic and Basic seeds according to the supervision of MoA

* KEPHIS inspects all stages of seeds

* MIAD & Contracted seed companies, other than KARI may multiply Pre-Basic & Basic seeds

Breeders Seed

Seed Companies KARI Seed Unit,

& MIAD

Basic Seed

Seed Stockists,Agro-dealers,

Inputs Suppliers,etc.

Pre-Basic Seed

27

• MWI – water supply, storage and regulation • District farmer associations – small scale milling and management of revolving fund

Funding process As noted above, the NRDS and its implementation framework have not specified exactly who will fund the various proposed initiatives. However, the government should, through the Treasury, meet a substantial portion of the projected US$ 23.5 million. 2.5 Agricultural Policy A key role of the MOA is to draw agricultural policy, provide related services, and to draw and implement the national food policy. In the latter, rice is recognised as the third most important cereal in Kenya after maize and wheat. Its importance therefore rates high in the national food policy framework. Rice development is therefore high priority especially in view of the potential for increased production through expansion of planted hectarage and application of efficient production methods. Agricultural policy in Kenya revolves around the main goals of increasing productivity and income growth, especially for smallholders; enhanced food security and equity, emphasis on irrigation to introduce stability in agricultural output, commercialisation and intensification of production especially among small scale farmers; appropriate and participatory policy formulation and environmental sustainability. The key areas of policy concern, therefore, include:

• Increasing agricultural productivity and incomes, especially for small-holder farmers. • Emphasis on irrigation to reduce over-reliance on rain-fed agriculture in the face of

limited high potential agricultural land. • Encouraging diversification into non-traditional agricultural commodities and value

addition to reduce vulnerability. • Enhancing the food security and a reduction in the number of those suffering from

hunger and hence the achievement of MDGs. • Encouraging private-sector-led development of the sector. • Ensuring environmental sustainability.19

This policy is addressed by the line ministries and affiliated bodies and is enforced at the private sector level. A key aspect of this policy is that participation and ownership of development initiatives is encouraged at the community level becasue studies have shown that when this is not done, development faulters as projects tend to be unsustainable. Initiatives in rice development have to apply the same approach to be assured of success.

19 Patrick O. Alila and Rosemary Atieno, (July 2006), Agricultural Policy in Kenya: Issues and Processes, A paper for the Future Agricultures Consortium workshop, Institute of Development Studies, University of Nairobi, 20-22 March 2006

28

2.6 Food Policy and Imports The staple Food Policy environment revolves around:

• NCPB purchase and sale of grain • Restrictions on trade by imposing duty on imports, wheat safeguard measures and

non-tariff barriers. Kenya has imposed a duty of 75% (up from 35%) or US$ 200 per ton on imported rice which mostly originates from Pakistan in an effort to protect local producers. However this has caused a trade row with Pakistan threatening to retaliate by imposing similar duty on Kenya tea. The row has made implementation of this measure uncertain.20

This policy creates an environment conducive to rice production if pricing of locally produced rice can compete with imported rice. However, due to the high costs incurred on fertilizers and other inputs, local aromatic rice prices are much higher than those of imported rice. The food policy employs strategies to enable it attain self-sufficiency by aiming at:

• Feeding the nation from local production. • Attaining self-sufficiency in each region. • Limited consideration to urban poor and rural landless. • Viewing grain importation and trade negatively. • Treating food security same as maize security since maize is the main staple.21 This

places rice at a disadvantage as a competitor for scarce government resources.

Nyoro (2006 op. cit) proposes the following measures to increase regional trade in staples, a move that would create a wider market for Kenyan rice:

i) Investment in science and Technology • Raise productivity for staples • Offer alternative high value crops to producers

ii) Investment in infrastructure • Roads and rail systems • Telecommunication, Electricity • Efficiency of ports and other border points

iii) Market information to inform on surpluses and deficits iv) Harmonization of grades and standards v) Simplify and harmonize trade regulations vi) Producer and trade organizations

20 In a move targeted at protecting growers, Kenya, Tanzania and Uganda unsuccessfully tried to charge a duty of 75 per cent on all rice imports entering their markets from January 1, 2005. This drew the wrath of Pakistani rice exporters who then pressured their government to arm-twist Kenya into deferring the duty or slapping a reciprocal raise in tea import duty. Kenya, threw in the towel first and submissively approached its fellow EAC members to shelve the import duty plans until June 30, 2009. 21 James Nyoro, (2006), Compatibility of Trade and Domestic Policy Affecting Staples in Kenya, Tegemeo Institute, Egerton University

29

These measures can be financed by regional governments and development partners through appropriate projects. 2.7 Programmes and Projects The following on-going projects and programmes, implemented at the national and sectoral level, were found to be relevant to rice development in Kenya:

i) NERICA Sustainable Dissemination Project (NSDP) Currently under implementation with RIPU coordination, the NSDP started this October 2010 and will last one year with the primary aim of popularising rice in five districts with potential for NERICA production. Its purpose is to establish a NERICA rice dissemination model. It is supported by JICA with inputs from the Rice Promotion Advisor and provision of the following materials:

• 5 tons of NERICA rice seed • 5 sets of milling machines • tons of fertilizer

The MOA provides:

• extension advisory services • training of extension staff and farmers • milling shed • monitoring and evaluation by the District Agricultural Officer and district staff

(DAO) • 5 tons of NERICA rice seed

Inputs and indicated materials are procured and distributed to interested farmers in a farmers’ association who grow NERICA and record carefully the harvest. The milling facility is placed in the hands of the association which must agree on its location and operation and maintenance procedure. The same quantity of rice given as seed is returned to the MOA to be allocated to a new farmer for the following season, so forming a revolving stock.

ii) National Economic Stimulus Programme This was announced by the Finance Minister on budget speech day but immediately ran into funding difficulties as it failed to obtain the required budgetary allocation. It was a case of good intention without proper planning. Once revived (if at all), it will support small and medium enterprises some of which will relate to rice development.

iii) Njaa Marufuku Kenya The Njaa Marufuku Kenya (NMK) programme was started in 2005 by Agriculture Sector Ministries with support from FAO and the MDG centre, to provide an overall strategic

30

framework for a 10-year action plan for hunger eradication in Kenya. It was formulated to fast track the fulfillment of MDG 1 – reduce by half the number of extremely poor and hungry people in the country by the year 2015. The Ministry of Agriculture is the focal point in NMK implementation. Grants of KShs. 315.5 million have been disbursed to 2593 community groups comprising 77,140 small-scale farmers since June 2005. In addition 854 Community Groups Facilitators have been trained and attached to the benefiting groups to build their technical capacity. The overall objective is to contribute to reduction of poverty, hunger and food insecurity among poor and vulnerable communities in Kenya by 2015. The components of the project which were formulated on the basis of the strategic objectives are:

• Component 1: Community-driven Food Security Improvement Initiatives • Component 2: Community Nutrition and School Meals Programme • Component 3: Support to Private Sector Food Security Innovations • Component 4: Project Management and Coordination

iv) Promotion of Private Sector Development in Agriculture

Promotion of Private Sector Development in Agriculture (PSDA) is a bilateral technical assistance programme jointly implemented by the German Agency for Technical Cooperation (GTZ) on behalf of the Government of Germany and the Ministry of Agriculture on behalf of the Government of Kenya. PSDA closely collaborates with other agricultural sector Ministries, mainly the Ministry of Livestock and Fisheries Development and Marketing. The programme started in October 2003 and is expected to run for 12 years. As from January 2008, the programme will move into its third phase following a programme progress review that was done early 2007. The new phase is expected to run until 2010.

v) Community Agricultural Development in Semi-Arid Lands Degradation of the natural resource base, coupled with high rates of population growth and food insecurity, is a major development problem in the Arid and Semi-Arid areas of sub-Saharan Africa. The majority of the poor and food insecure are concentrated in rural areas, where their livelihoods depend on smallholder agriculture, rural labour markets, and livestock production. The whole idea in NRM is thus to plan and implement a coordinated set of activities to make the most beneficial and sustainable long-term use of soils, landscape, water, vegetation, livestock, agriculture, wildlife and human in order to achieve sustainable development.

vi) Southern Nyanza Community Development Project The project area covers six districts – Homa Bay, Kuria, Migori, Nyamira, Rachuonyo and Suba – that are among the poorest districts in the relatively high-potential agricultural area of

31

southern Nyanza, on Lake Victoria. Communities in these districts have strong socio-cultural traditions and norms; poverty levels are high; institutional and policy infrastructure is weak; and the HIV/AIDS rate is higher than the national average. The project focuses on empowering rural communities by:

• strengthening local institutions and community-driven development activities • improving access to health care services and safe water, and improving environmental

sanitation and hygiene practices • increasing on-farm labour productivity and strengthening human capacity through

improved food security and nutrition • heightening community awareness of social behaviours and their consequences

Communities articulate their needs and priorities through a community action planning process. Self-help groups form the focus of economic activities. Local community committees manage health care centres, water points and latrines. Innovative features include local livelihood forums, which promote community awareness of a wide range of socio-cultural issues, and support groups for vulnerable households. The rural areas covered by the project, which began operations in 2004, have a high potential for agriculture. The injection of additional resources consolidates the project’s investments and ensures the sustainability of the benefits generated. The strategy is to invest more in water-related activities and institutions in order to achieve greater sustainability and impact. The supplementary funds also support food security and improved soil productivity and will be used to help farmers adapt to the increasing incidence of droughts and floods and to fluctuating food prices. The supplementary loan uses additional resources available under the performance-based allocation system, which allocates IFAD country loan and grant resources on the basis of country performance, population and per capita gross national income. Performance criteria include the country’s policy framework, rural development policy and portfolio performance.

vii) Kenya Arid and Semi-Arid Research programme The Kenya Arid and Semi-Arid Lands Research programme (KASAL) will be implemented by the Kenya Agricultural Research Institute (KARI) over the next five years (2006-2010) that was launched on 18th September 2006. KASAL is financed jointly by the Government of Kenya and the European Union. This programme focuses on developing site specific agricultural technologies for farmers and livestock keepers in the Arid and Semi-Arid Lands. The ASALs cover 80 per cent of the country and support 30 per cent of the population. These areas support 60 per cent of the livestock and 65 per cent of the wildlife. Despite the huge potential the people living in the Arid and Semi-arid areas have remained outside the mainstream economy of the country.

32

These areas are characterized by high poverty rates. Subsistence is the way of life for most of these farmers who are agro-pastoralists and pastoralists. Poverty rates are between 60 and 80 per cent, and are highest amongst female-headed households, and thousands are dependent on famine relief. 2.8 Current Public Expenditure Framework and Funding Processes For funding of its operations and projects/programmes, Kenya adheres to an annual budgeting routine that fits into the MTEF which was introduced in Kenya in 1998. Available funds from development partners are factored into both the annual budget and the MTEF. To accelerate development in the agriculture sector in developing African economies, Kenya signed the Maputo Declaration in 2003 committing to adhere to the rule to allocate a minimum of 10% of government expenditure to the agricultural sector. On the whole, Kenya has not adhered to the Maputo Declaration as the national budget committed to the agriculture sector has not yet attained this threshold. However, as shown in Table 2.6. there was a gradual increase from a low of 4.6% in 2003/04 to 7.8% in 2007/08 but recent trends show a sharp decline to an all time low of 2.8% in 2009/10 with the recurrent portion of the budget taking an increasingly greater share each successive year. Table 2.6: Budget Allocation to the Agriculture Sector Ministries, KShs Million

Budget Year Total Recurrent Development Total as % of National Budget

2003/04 15,700 11,200 4,500 4.6 2004/05 17,600 10,800 6,800 4.6 2005/06 19,100 12,600 6,500 5.7 2006/07 24,600 15,200 9,400 6.5 2007/08 30,300 16,600 13,700 7.8 2008/09 25,757 15,454 10,302 4.3 2009/10 23,930 15,578 8,352 2.8

Source: Medium Term Expenditure Framework 2008/09-2010/11; Agriculture Economic Review 2010

Note: Sector ministries are: Agriculture, Cooperative Development, Fisheries Development, Lands, and Livestock Development.

It is evident from the budgetary allocations to the agriculture sector that Kenya has not maintained the Maputo Declaration (2003) requirement that at least 10% of the national budget to the sector. The decline in this ratio from 2007 to present is particularly worrying considering that Kenya suffers recurrent food shortages due to droughts whose cycle appears to have shortened from about seven years to about four years in the recent past. Over 80% of Kenya is either arid or semi-arid and droughts in these parts can last as much as four years on a stretch.

33

3. MATCHING OF THE STRATEGIES, POLICIES, PROGRAMMES AND THE EXPENDITURE FRAMEWORKS WITH THE NRDS’ SUB-SECTORS

The strategies, policies, programmes and expenditure frameworks presented in the preceding sections relate directly to rice development in Kenya. The NRDS identifies the following key challenges to its implementation and realization of its full potential:

1. Inadequate irrigation infrastructure 2. Inadequate water for irrigation 3. Diseases such as blast 4. Poor quality seeds (uncertified) 5. An unorganised seed and input supply system 6. Poor understanding of rice culture 7. Uncoordinated markets 8. Access to affordable credit and 9. Weak farmer institutions.

Further, the FMTP recognises the following issues which have already been presented in Section 2 as the Achilles tendon of Kenyan agriculture:

1. Inadequate budgetary allocation 2. Reduced effectiveness of extension services 3. Low absorption of modern technology 4. High cost and increased adulteration of key inputs 5. Limited capital and access to affordable credit 6. Pre- and post-harvest crop losses 7. Low and declining soil fertility 8. Inadequate disaster preparedness and response 9. Multiple taxes 10. Inadequate infrastructure 11. Insufficient water storage infrastructure 12. Inadequate storage and processing facilities 13. Inadequate markets and marketing infrastructure

The matrices that follow are an attempt to analyse on-going and planned initiatives aimed at resolving these issues and their linkages to the NRDS. While the NRDS intends to focus on promotion of rice, the government has many other projects, programmes and is conducting dialogues which can render synergy to the implementation of the NRDS. Such initiatives abound in the extension, research and other sectors and are variously funded by a wide range of development partners, the government and the beneficiary communities. Table 3.1 is a harmonization of the constraints identified by the ERS, many of which have been carried over to the FMTP and are reflected in the NRDS. The MTEF will be the main framework for funding the NRDS at the national level while the SWAP will determine funding at the district level.

34

Table 3.1: S

ummary of Constraints and

Solutions for Development of the Agricultural Sector and Rice Su

b-sector (M

atrix 1)

Agricultural Sub-

sector

ERS

FMTP

NRDS

Cro

p de

velo

pmen

t •

Res

earc

h an

d ex

tens

ion

serv

ices

•

Acc

ess

to c

redi

t •

Div

ersi

fica

tion

of e

nter

pris

es a

nd c

rop

uses

•

Coo

pera

tive

deve

lopm

ent

• V

alue

add

ition

•

Gua

rant

eed

min

imum

retu

rns

• Ph

ysic

al in

fras

truc

ture

dev

elop

men

t

• Po

or e

xten

sion

ser

vice

s •

Inef

fici

ent r

ural

fina

nce

and

cred

it sy

stem

•

Poor

rura

l inf

rast

ruct

ure

• Po

or m

arke

ting

and

dist

ribu

tion

• Im

prov

e fa

rmer

s’ a

cces

s to

cre

dit.

• Im

prov

e fa

rmer

s’ a

cces

s to

qua

lity

inpu

ts.

• Im

prov

e ex

tens

ion

and

tech

nica

l adv

isor

y se

rvic

es.

• R

aise

rate

s of

tech

nolo

gy a

dopt

ion.

•

Dev

elop

pro

duct

s, m

arke

ts a

nd m

arke

ting

chan

nels

. •

Dev

elop

and

str

engt

hen

stak

ehol

der

netw

orks

. •

Incr

ease

rice

rese

arch

hum

an r

esou

rce.

R

ural

Wat

er

• W

ater

and

san

itatio

n de

velo

pmen

t •

Shor

tage

of w

ater

sup

ply

• Po

or m

anag

emen

t of w

ater

reso

urce

s •

Des

truc

tion

of ri

ver c

atch

men

ts

• R

ehab

ilita

te d

ilapi

date

d ir

riga

ted

rice

sc

hem

es.

• B

uild

new

irri

gate

d ri

ce s

chem

es.

• E

xpan

d ar

ea u

nder

rice

. •

Impr

ove

wat

er u

se m

anag

emen

t thr

ough

W

UA

s.

Liv

esto

ck

deve

lopm

ent

• D

evel

opm

ent o

f agr

icul

ture

, liv

esto

ck a

nd

fish

ing

• Fo

od a

nd n

utri

tion

• D

evel

opm

ent o

f ari

d an

d se

mi-

arid

land

s

• L

ives

tock

dis

ease

s •

Poor

live

stoc

k m

arke

ting

• Po

or e

xten

sion

ser

vice

s

----

----

----

--

Food

sec

urity

•

Prev

alen

ce o

f dro

ught

and

food

sho

rtag

es

• Pr

eval

ence

of d

roug

ht a

nd fo

od s

hort

ages

•

Rai

se ri

ce p

rodu

ctiv

ity (

yiel

ds) t

hrou

gh

impr

oved

cul

tura

l pra

ctic

es a

nd k

now

ledg

e on

yie

ld fa

ctor

s.

• R

educ

e fi

eld

and

post

harv

est l

osse

s.

Lan

ds a

nd

settl

emen

ts

• L

and

adm

inis

trat

ion

and

surv

ey

• L

and

tenu

re in

ari

d an

d se

mi-

arid

land

s •

Poor

land

pol

icy

and

lega

l fra

mew

ork

• N

egat

ive

cultu

ral p

ract

ices

in r

elat

ion

to

owne

rshi

p of

land

by

wom

en

• E

nsur

e in

divi

dual

ow

ners

hip

of ri

ce la

nd to

en

able

use

of t

itle

as c

olla

tera

l for

loan

s.

Sour

ce: E

RS,

200

3 an

d FM

TP,

200

8

35

Table 3.2: A

nalysis of Strategic M

easures and Actions to Improve Agriculture (M

atrix 2)

NRDS Strategic Measure

Implem

ented actions at national and district level

Com

ments and dialogues

1.

Em

pow

erin

g fa

rmer

s by

st

reng

then

ing

prod

ucer

or

gani

zatio

ns

Form

atio

n of

KE

NFA

B, K

ESR

EF,

RFA

K, C

oope

rativ

es a

nd re

gist

ered

fa

rmer

Com

mon

Inte

rest

Gro

ups

(CIG

s) to

enh

ance

bar

gain

ing

pow

er

and

enjo

y be

nefi

ts o

f eco

nom

ies

of s

cale

.

Dia

logu

e op

ened

bet

wee

n K

EN

FAB

and

gov

ernm

ent t

o re

vita

lise

the

KFA

whi

ch h

as a

cou

ntry

-wid

e ne

twor

k of

farm

inpu

t sup

ply

outle

ts.

2.

Impr

ovin

g re

gula

tory

fr

amew

orks

N

o pr

ice

cont

rols

, rel

ianc

e on

tari

ffs

as o

nly

barr

ier t

o tr

ade,

co

nfor

mity

with

CO

ME

SA a

nd E

AC

free

trad

e ru

les.

To

enco

urag

e m

anuf

actu

ring

in K

enya

for

wor

ld m

arke

ts, t

he G

over

nmen

t has

es

tabl

ishe

d an

in-b

ond

prog

ram

me

open

to b

oth

loca

l and

fore

ign

inve

stor

s. IP

C a

nd M

inis

try

of F

inan

ce (D

epar

tmen

t of C

usto

ms

and

Exc

ise)

adm

inis

ter t

he p

rogr

am. E

nter

pris

es o

pera

ting

unde

r the

pr

ogra

mm

e ar

e of

fere

d in

cent

ives

: •

exem

ptio

n fr

om d

uty

and

VA

T o

n im

port

ed p

lant

, mac

hine

ry a

nd

equi

pmen

t, ra

w m

ater

ial a

nd o

ther

impo

rted

inpu

ts; a

nd

• 10

0% in

vest

men

t allo

wan

ce o

n pl

ant,

mac

hine

ry, e

quip

men

t and

bu

ildin

gs.

Mos

t Ken

yan

busi

ness

es o

pen

to fo

reig

ners

who

wis

h to

inve

st.

Exp

ort P

roce

ssin

g Z

ones

are

coo

rdin

ated

by

the

Exp

ort P

roce

ssin

g Z

ones

Aut

hori

ty (E

PZA

). A

num

ber o

f EPZ

s al

read

y es

tabl

ishe

d.

Ent

erpr

ises

ope

ratin

g in

EPZ

s in

Ken

ya e

njoy

follo

win

g be

nefi

ts:

• 10

yea

rs ta

x ho

liday

and

a fl

oat 2

5% ta

x fo

r the

nex

t 10

year

s;

• ex

empt

ion

from

all

with

hold

ing

taxe

s on

div

iden

ds a

nd o

ther

pa

ymen

ts to

non

-res

iden

ts d

urin

g th

e fi

rst 1

0 ye

ars;

•

exem

ptio

n fr

om im

port

dut

ies

on m

achi

nery

raw

mat

eria

ls a

nd

inte

rmed

iate

inpu

ts;

• no

rest

rict

ion

on m

anag

emen

t or t

echn

ical

arr

ange

men

t; •

exem

ptio

n fr

om s

tam

p du

ty; a

nd

• ex

empt

ion

from

VA

T a

nd o

pera

te o

n on

e lic

ense

onl

y.

3.

Rev

iew

ing

taxa

tion

on

agri

cultu

re

No

tax

on a

gric

ultu

ral m

achi

nery

, im

plem

ents

, fer

tiliz

er, s

eed

and

othe

r fa

rm in

puts

, tax

hol

iday

for a

gro-

pro

cess

ors

on c

apita

l inv

estm

ents

. E

duca

tion

need

ed in

the

sect

or to

info

rm p

oten

tial i

nves

tors

on

adva

ntag

es o

f inv

estin

g in

Ken

yan

agri

cultu

re.

4.

Impr

ovin

g th

e ag

ricu

ltura

l ex

tens

ion

syst

em

Gra

duat

e ex

tens

ion

staf

f pos

ted

to D

ivis

ion

leve

l and

Dip

lom

a of

fice

rs

to L

ocat

ion

leve

l. A

gap

exi

sts

betw

een

num

bers

nee

d an

d in

pla

ce.

Ken

ya h

as in

crea

sed

the

num

ber o

f dis

tric

ts fr

om 4

3 to

ove

r 250

in

the

last

ten

year

s. T

here

is n

eed

to in

crea

se e

xten

sion

sta

ff n

umbe

rs.

5.

Est

ablis

hing

an

effi

cien

t ag

ricu

ltura

l res

earc

h sy

stem

KA

RI h

as o

ver 4

0 re

sear

ch s

tatio

ns a

nd s

ub-s

tatio

ns a

roun

d th

e co

untr

y co

nduc

ting

a w

ide

rang

e or

rese

arch

in c

rop

prot

ectio

n an

d im

prov

emen

t. O

ther

s ar

e lin

e m

inis

trie

s, u

nive

rsiti

es, c

olle

ges

of

agri

cultu

re a

nd p

aras

tata

l org

anis

atio

ns –

NIB

, LB

DA

, KV

DA

, etc

.

Coo

rdin

atio

n of

act

iviti

es o

ccur

s th

roug

h re

gula

r tec

hnic

al

exch

ange

s in

con

fere

nces

and

inte

r-m

inis

teri

al c

omm

ittee

s.

6.

Incr

easi

ng c

ompe

titio

n in

th

e su

pply

of a

gric

ultu

ral

inpu

ts

Lib

eral

isat

ion

of tr

ade

by re

mov

ing

pric

e co

ntro

ls s

o th

at th

e fo

rces

of

supp

ly a

nd d

eman

d ru

le th

e m

arke

t, st

anda

rds

and

qual

ity c

ontr

ol

thro

ugh

KE

BS

and

KE

PHIS

.

The

lice

nsed

agr

o-ve

t sto

re is

a c

omm

on b

usin

ess

in a

ll th

e to

wns

in

Ken

ya to

day.

It s

tock

s al

l the

requ

irem

ents

for c

rop

and

lives

tock

fa

rmin

g.

7.

Impr

ovin

g ac

cess

to

fina

ncia

l ser

vice

s an

d cr

edit

Ext

ensi

ve b

anki

ng s

ervi

ces

expa

nsio

n to

rura

l are

as, S

AC

CO

m

ovem

ent,

RO

CSA

cul

ture

am

ong

farm

ing

com

mun

ities

, mon

ey-

lend

ing

by in

divi

dual

s, e

nact

men

t of t

he M

icro

fina

nce

Act

. St

reng

then

ing

the

AFC

.

Low

erin

g of

inte

rest

rate

s on

Cen

tral

Ban

k of

Ken

ya T

reas

ury

Bon

ds a

nd o

ther

bor

row

ing

inst

rum

ents

has

redu

ced

lend

ing

rate

s to

the

publ

ic b

y ba

nks

and

non-

bank

ing

fina

ncia

l ins

titut

ions

.

8.

Prom

otin

g m

arke

t or

ient

atio

n T

rain

ings

thro

ugh

coop

erat

ive

mov

emen

t, kn

owle

dge

on p

rodu

ce

pric

es th

roug

h K

AC

E, r

adio

, tel

evis

ion

and

inte

rnet

. Fa

rmer

s tr

aine

d to

farm

as

a bu

sine

ss a

nd n

ot ju

st a

s so

urce

of f

ood.

Pr

oduc

ing

for t

he m

arke

t has

bee

n w

idel

y un

ders

tood

.*

9.

Enc

oura

ging

gro

wth

of

agri

busi

ness

R

oads

, ele

ctri

city

and

tele

phon

e se

rvic

e re

ticul

atio

n in

rur

al a

reas

to

enco

urag

e lo

cal a

gro-

proc

essi

ng a

nd a

rtis

anal

Bus

ines

s D

evel

opm

ent

Serv

ices

(BD

S) th

at s

uppo

rt a

gric

ultu

re –

mac

hine

ry/e

quip

men

t fa

bric

atio

n an

d re

pair

, eas

y co

mm

unic

atio

n, p

rodu

ce tr

ade

etc.

Roa

d im

prov

emen

t and

wid

er r

etic

ulat

ion

has

impr

oved

ac

cess

ibili

ty to

farm

ing

com

mun

ities

and

redu

ced

tran

spor

t cos

ts.

Agr

ibus

ines

ses

can

now

be

loca

ted

whe

re th

e m

arke

t is

rath

er th

an

vice

ver

sa a

s in

the

past

.

36

Table 3.3: F

ramew

orks of P

olicies/Dialogue - O

ngoing and Planned with Inputs for NRDS (M

atrix 3)

NRDS Su

bsector

Dream

– Nam

e of fram

ework

Stakeholders/Champions

Agenda and action

Status and period

1.

Incr

ease

rice

yie

ld

per u

nit a

rea

in ra

in-

fed

and

irri

gate

d co

nditi

ons

Incr

ease

irri

gatio

n an

d dr

aina

ge c

rop

yiel

ds b

y at

leas

t 10%

of t

he y

ield

gap

ea

ch y

ear.

NIB

, LB

DA

, KA

RI,

MO

A,

MIA

D

Tra

inin

g of

Tra

iner

s at

MIA

D a

nd ta

rget

di

stri

cts

to tr

ain

farm

ers

on ri

ce c

ultu

ral a

nd

grow

th a

spec

ts th

at le

ad to

yie

ld in

crea

ses.

Ong

oing

thro

ugh

RIP

U.

Plan

ned

for 2

009-

2012

2.

Impr

ove

and

expa

nd

irri

gate

d an

d ra

in-

fed

rice

pro

duct

ion

- Dev

elop

new

irri

gatio

n an

d dr

aina

ge

com

man

d ar

eas

at th

e ra

te o

f 32,

000

ha

per y

ear.

-R

ehab

ilita

te e

xist

ing

irri

gatio

n an

d dr

aina

ge a

reas

at t

he ra

te o

f 8,0

00 h

a pe

r yea

r

MW

I, M

OA

, NIB

, Don

or

part

ners

, pri

vate

sec

tor –

co

ntra

ctor

s, c

onsu

ltant

s

- Exp

ansi

on o

f Mw

ea Ir

riga

tion

Sche

me

thro

ugh

JIC

A fu

ndin

g.

- Ahe

ro a

nd W

est K

ano

rice

sch

emes

re

habi

litat

ed. B

ura

in th

e pi

pelin

e.

- Rai

n-fe

d N

ER

ICA

pro

ject

targ

etin

g fi

ve

dist

rict

s di

stri

butin

g se

ed a

nd in

puts

for s

eed

mul

tiplic

atio

n in

pilo

t pha

se.

Ong

oing

thro

ugh

RIP

U.

Plan

ned

for 2

009-

2012

.

3.

Red

uce

fiel

d an

d po

st h

arve

st lo

sses

E

nhan

ce u

tiliz

atio

n of

sci

ence

and

te

chno

logy

in ir

riga

ted

and

drai

nage

ag

ricu

lture

by

impr

ovin

g ac

cess

to u

p-to

dat

e an

d re

leva

nt in

form

atio

n an

d kn

owle

dge.

MO

A, N

IB, K

AR

I, U

nive

rsiti

es

- Nat

ionw

ide

trai

ning

and

ext

ensi

on

info

rmat

ion

diss

emin

atio

n on

sto

rage

. - N

CPB

vou

cher

sys

tem

for f

arm

ers’

gra

in

stor

age

in N

CPB

sto

res.

Com

men

ced.

T

he N

CPB

vou

cher

sys

tem

is

now

in p

lace

. A s

tora

ge le

vy

will

be

char

ged.

T

rain

ing

by e

xten

sion

sta

ff is

co

ntin

uous

.

4.

Ens

ure

sust

aina

ble

acce

ss to

aff

orda

ble

cred

it, h

igh

qual

ity

inpu

ts a

nd s

eed

to

farm

ers.

- Fac

ilita

te fa

st s

prea

d of

ban

king

fa

cilit

ies

and

non-

bank

lend

ing

inst

itutio

ns in

to th

e ru

ral a

reas

. - A

dvis

e fa

rmer

s on

use

and

m

anag

emen

t of l

oan

fund

s

Ban

ks, M

icro

-len

ders

, C

oope

rativ

es, C

IG, M

OA

an

d ot

her t

rain

ers

Equ

ity, K

-Rep

, KW

FT a

nd o

ther

mic

ro-

lend

ing

bank

s an

d no

n-ba

nkin

g fi

nanc

ial

inst

itutio

ns h

ave

spre

ad th

eir s

ervi

ces

to

rura

l are

as. C

rop

insu

ranc

e in

trod

uced

.

On-

goin

g.

Perm

anen

t.

5.

Faci

litat

e in

crea

sed

prod

uctio

n an

d pr

oduc

tivity

thro

ugh

impr

oved

ext

ensi

on

advi

sory

sup

port

se

rvic

es a

nd

tech

nolo

gy

deve

lopm

ent a

nd

diss

emin

atio

n

Enh

ance

util

izat

ion

of s

cien

ce a

nd

tech

nolo

gy in

irri

gate

d an

d dr

aina

ge

agri

cultu

re b

y im

prov

ing

acce

ss to

up-

to-d

ate

and

rele

vant

info

rmat

ion

and

know

ledg

e.

KA

RI,

MO

A, M

IAD

, L

BD

A, N

IB, C

oope

rativ

es

Agr

icul

tura

l ext

ensi

on a

dvis

ory

serv

ices

a

gove

rnm

ent p

rior

ity. D

istr

icts

incr

ease

d an

d se

rvic

es a

vaila

ble

dow

n to

vill

age

leve

l. K

AR

I, IC

IPE

and

oth

er re

sear

ch

orga

nisa

tions

dis

sem

inat

ing

thei

r res

earc

h fi

ndin

gs re

gula

rly

to fa

rmin

g co

mm

unity

.

On-

goin

g. R

egul

ar a

nnua

l and

m

ore

freq

uent

foru

ms

for

diss

emin

atio

n of

rese

arch

fi

ndin

gs b

y K

AR

I, IC

IPE

and

th

e un

iver

sitie

s.

37

6.

Bui

ld a

dequ

ate

tech

nica

l cap

acity

fo

r ric

e pr

oduc

tion

Impr

ove

serv

ice

deliv

ery

of ir

riga

tion

and

drai

nage

and

rela

ted

inst

itutio

ns.

MO

A, K

AR

I, N

IB, L

BD

A,

KV

DA

, CD

A

New

wee

ding

tech

nolo

gy b

eing

intr

oduc

ed

at M

IAD

usi

ng im

plem

ent t

hat c

an b

e lo

cally

fabr

icat

ed. K

now

ledg

e on

gro

wth

se

ason

sen

sitiv

ities

for t

iller

ing

and

prod

uctiv

ity c

ontr

ol a

lso

bein

g ta

ught

.

Star

ted

2009

and

on-

goin

g.

Cur

rent

JIC

A-s

uppo

rted

pr

ojec

t (te

chni

cal a

dvis

or) u

p to

201

2.

7.

Dev

elop

and

st

reng

then

st

akeh

olde

r ne

twor

ks a

nd

part

ners

hips

-Enh

ance

gen

der e

quity

in ir

riga

tion

and

drai

nage

by

incr

easi

ng th

e nu

mbe

r of

wom

en a

nd y

outh

mem

bers

of

irri

gatio

n an

d dr

aina

ge c

omm

ittee

for

at le

ast 2

0 sc

hem

es a

yea

r.

-Im

prov

e re

sour

ce m

obili

zatio

n (a

) by

incr

easi

ng b

udge

tary

allo

catio

n to

ir

riga

tion

and

drai

nage

dev

elop

men

t by

at le

ast 1

% o

f the

nat

iona

l bud

get,

and

(b) b

y en

hanc

ing

priv

ate-

publ

ic

part

ners

hip.

- E

ncou

rage

form

atio

n of

coo

pera

tives

an

d tr

aini

ng in

coo

pera

tive

man

agem

ent.

MO

CD

, MO

A, M

OG

YS,

C

ivil

soci

ety

orga

niza

tions

, IN

GO

, loc

al N

GO

s

NR

DS

deve

lope

d by

com

mitt

ee th

at e

volv

ed

into

a p

erm

anen

t Nat

iona

l Ric

e D

evel

opm

ent C

omm

ittee

(NR

DC

). B

ring

s m

any

stak

ehol

ders

toge

ther

– p

rodu

cers

, sc

ient

ists

, gov

ernm

ent,

univ

ersi

ties,

civ

il so

ciet

y or

gani

zatio

ns, m

iller

s an

d ot

her

RV

C p

laye

rs.

Com

mitt

ee m

ay re

quir

e pe

rman

ent s

ecre

tari

at to

run

rice

sam

e w

ay m

ajor

cro

ps a

nd

othe

r pro

duce

are

run

in K

enya

–

e.g.

Cof

fee,

tea,

milk

etc

.

8.

Mar

ket d

evel

opm

ent

Enh

ance

con

sum

ptio

n of

loca

lly

prod

uced

rice

, inc

reas

e du

ty o

n im

port

ed ri

ce, e

nsur

e ap

prop

riat

e qu

ality

con

trol

on

rice

impo

rts

to le

vel

the

mar

ket c

ondi

tions

to a

llow

loca

l ri

ce fa

ir c

ompe

titio

n.

MO

A, p

riva

te s

ecto

r, M

OF

- Im

port

ed ri

ce c

usto

ms

duty

incr

ease

d fr

om

35%

to 7

5% o

r US

$ 20

0 pe

r ton

whi

chev

er

is h

ighe

r to

prot

ect l

ocal

pro

duct

ion.

W

rang

le w

ith d

isse

ntin

g co

untr

ies

of o

rigi

n of

impo

rted

rice

bei

ng re

solv

ed.

- Ric

e ea

ting/

adop

tion

cam

paig

n un

derw

ay

in a

reas

whe

re ri

ce w

as g

ener

ally

unk

now

n e.

g. N

orth

Rif

t (M

arak

wet

) w

here

NE

RIC

A

is n

ow g

row

n.

Smal

l ric

e m

ills

are

enco

urag

ed a

nd e

ntre

pren

eurs

ar

e gi

ven

com

mer

cial

loan

s to

go

into

rice

mill

ing

as a

bu

sine

ss. O

n-go

ing

and

spre

adin

g ra

pidl

y en

cour

aged

by

ava

ilabi

lity

of e

nerg

y th

roug

h th

e ru

ral e

lect

rifi

catio

n pr

ogra

mm

e.

9.

Part

icip

ator

y m

onito

ring

and

ev

alua

tion

-Ens

ure

com

plia

nce

to e

nvir

onm

enta

l &

hea

lth re

quir

emen

ts o

f at l

east

10

irri

gatio

n &

dra

inag

e sc

hem

es/y

r -E

nsur

e th

at th

ere

is p

ro-a

ctiv

e an

d en

ablin

g po

licie

s an

d le

gisl

ativ

e fr

amew

ork

by re

view

ing

impa

cts

at

leas

t eve

ry 5

yea

rs.

KE

PHIS

, NE

MA

, KE

BS,

M

OA

A

naly

sis

of ta

il w

ater

at W

est K

ano

Ric

e Sc

hem

e fo

und

to b

e un

suita

ble

for r

ecyc

ling

as it

is to

o hi

gh in

SA

R a

t 35%

aga

inst

Lak

e V

icto

ria’

s 18

% m

akin

g bo

th u

nsui

tabl

e fo

r ir

riga

tion.

Sch

eme

effl

uent

s ho

wev

er ri

ch in

ni

trat

es m

eani

ng a

pplic

atio

n of

less

fert

ilize

r if

use

d.

Wat

er q

ualit

y an

d ef

flue

nt u

se

clos

ely

mon

itore

d by

the

NIB

an

d K

AR

I.

Sour

ce: N

RD

S, 2

009;

Nat

iona

l Wat

er M

aste

r Pla

n, 2

009

38

Table 3.4: P

rogram

mes/Projects of Partners in Development w

ith Inputs for NRDS (M

atrix 4)

NRDS SU

B-SECTORS (BUDGET – M

ILLIO

N KENYA SHILINGS):

1.

Incr

ease

rice

yie

ld p

er u

nit a

rea

in ra

in-f

ed a

nd ir

riga

ted

cond

ition

s in

crea

sed

(108

.2).

2.

Impr

ove

and

expa

nd ir

riga

ted

and

rain

-fed

rice

pro

duct

ion

(1,0

16.1

). 3.

Red

uce

fiel

d an

d po

st h

arve

st lo

sses

(24.

9).

4.

Ens

ure

sust

aina

ble

acce

ss to

aff

orda

ble

cred

it, h

igh

qual

ity in

puts

and

see

d to

farm

ers

(32.

0).

5.

Faci

litat

e in

crea

sed

prod

uctio

n an

d pr

oduc

tivity

thro

ugh

impr

oved

ext

ensi

on a

dvis

ory

supp

ort s

ervi

ces

and

tech

nolo

gy d

evel

opm

ent a

nd d

isse

min

atio

n (3

22.2

). 6.

Bui

ld a

dequ

ate

tech

nica

l cap

acity

for r

ice

prod

uctio

n (9

1.2)

. 7.

Dev

elop

and

str

engt

hen

stak

ehol

der n

etw

orks

and

par

tner

ship

s (1

0.0)

. 8.

Mar

ket d

evel

opm

ent (

55.0

). 9.

Part

icip

ator

y m

onito

ring

and

eva

luat

ion

(38.

0).

No.

Project Nam

e and Fun

ding

Agency

Project Goal

Champions/

Stakeholders

Coverage

Total budget,

KShs Million

Period

NRDS sub-sector

& related budget

KShs Million

1.

Nat

iona

l agr

icul

ture

and

liv

esto

ck e

xten

sion

pro

ject

(N

AL

EP-

SID

A)

The

con

trib

utio

n of

agr

icul

ture

, fis

heri

es

and

lives

tock

kee

ping

to s

ocia

l and

ec

onom

ic d

evel

opm

ent a

nd p

over

ty

alle

viat

ion

enha

nced

thro

ugh

incr

ease

d an

d eq

uita

ble

prod

uctiv

ity a

nd in

com

e en

hanc

ed.

GO

K, S

IDA

, fa

rmer

s,

fish

erm

en

Nat

ionw

ide

5,83

0 20

00-2

012

1, 3

, 5, 7

465.

3

2.

Nja

a M

aruf

uku

Ken

ya (N

MK

-G

OK

/FA

O/M

DG

Cen

tre)

T

o co

ntri

bute

to re

duct

ion

of p

over

ty,

hung

er a

nd fo

od in

secu

rity

am

ong

poor

an

d vu

lner

able

com

mun

ities

in K

enya

by

201

5.

GO

K, F

AO

, co

mm

unity

gr

oups

, sch

ool

child

ren

Nat

ionw

ide

8,00

0 20

05-2

015

3, 8

79.9

3.

Nat

iona

l acc

eler

ated

agr

icul

ture

in

put a

cces

s pr

ogra

m

(NA

AIA

P-G

OK

)

To

cont

ribu

te to

war

ds im

prov

ed

livel

ihoo

ds fo

r sm

allh

olde

r far

mer

s ow

ning

less

than

1 h

a of

land

thro

ugh

the

prom

otio

n, a

cces

s an

d us

e of

farm

in

puts

and

pro

visi

on o

f sup

port

ser

vice

s.

2.5

mill

ion

smal

lhol

der

farm

ers

with

le

ss th

an 1

ha

of la

nd h

oldi

ng

Nat

ionw

ide

2,09

3 20

06-

inde

fini

te

1, 2

, 4, 7

1,16

6.3

39

4.

Pr

omot

ion

of p

riva

te s

ecto

r de

velo

pmen

t in

agri

cultu

re

PSD

A-G

OK

/GT

Z)

To

assi

st fa

rmer

s an

d ag

ricu

ltura

l en

trep

rene

urs

to b

ette

r int

egra

te in

to

natio

nal o

r int

erna

tiona

l mar

kets

usi

ng

the

valu

e ch

ain

appr

oach

.

GO

K, G

TZ

, sm

allh

olde

r fa

rmer

s,

trad

ers,

agr

o-pr

oces

sors

16 d

istr

icts

in

Cen

tral

, Eas

tern

, R

ift V

alle

y,

Wes

tern

and

N

yanz

a pr

ovin

ces

1,80

0 20

03-2

015

7, 8

65.0

5.

Agr

icul

ture

sec

tor p

rogr

amm

e su

ppor

t (A

SPS-

DA

NID

A/G

OK

) T

o re

vita

lize

grow

th o

f the

agr

icul

tura

l se

ctor

by

prov

idin

g a

cond

uciv

e po

licy

and

inst

itutio

nal e

nvir

onm

ent t

o in

crea

se a

gric

ultu

ral p

rodu

ctiv

ity,

prom

otin

g in

vest

men

t and

enc

oura

ging

pr

ivat

e se

ctor

invo

lvem

ent i

n ag

ricu

ltura

l ent

erpr

ises

and

ag

ribu

sine

ss.

GO

K,

DA

NID

A,

ASC

U, N

GO

s,

Gov

t. ag

enci

es

Eas

tern

and

C

oast

pro

vinc

es

2,34

0 20

05-2

010

7,

9

48.0

6.

Com

mun

ity a

gric

ultu

ral

deve

lopm

ent p

roje

ct in

sem

i-ar

id la

nds

(CA

DSA

L-

JIC

A/G

OK

)

Agr

icul

tura

l pro

duct

ion

is in

crea

sed

in

Kei

yo a

nd M

arak

wet

dis

tric

ts.

JIC

A, G

OK

, fa

rmer

s, fa

rmer

or

gani

zatio

ns,

wom

en, y

outh

, pa

stor

alis

ts

Kei

yo a

nd

Mar

akw

et

dist

rict

s

120

2005

-201

0

1, 2

, 5, 7

1,45

6.5

7.

Ken

ya a

gric

ultu

ral p

rodu

ctiv

ity

proj

ect (

KA

PP-W

B/G

OK

) T

o co

ntri

bute

to s

usta

inab

le in

crea

se in

K

enya

’s a

gric

ultu

ral p

rodu

ctiv

ity a

nd

impr

ovem

ent o

f the

live

lihoo

ds o

f its

ru

ral c

omm

uniti

es.

GO

K, W

B,

farm

ers

in

targ

et d

istr

icts

20 d

istr

icts

in

Coa

st, E

aste

rn,

Cen

tral

, Rif

t V

alle

y, N

yanz

a,

Wes

tern

, pr

ovin

ces

3,20

0 20

04-2

009

1,

3, 5

, 6

54

3.5

8.

Cen

tral

Ken

ya d

ry a

reas

and

sm

allh

olde

r com

mun

ity s

ervi

ces

deve

lopm

ent p

roje

ct (C

KD

AP-

IFA

D/B

SF/G

OK

)

To

redu

ce m

orta

lity

and

mor

bidi

ty in

th

e pr

ojec

t are

a an

d im

prov

e th

e w

ellb

eing

of t

arge

t gro

up h

ouse

hold

s.

GO

K, I

FAD

, B

SF, C

omm

on

inte

rest

gro

ups

(CIG

), fa

rmer

s

5 di

stri

cts

– dr

ier p

arts

of

Kir

inya

ga,

Nye

ri,

Nya

ndar

ua,

Thi

ka, M

uran

gá

1,44

8 20

01-2

010

2, 7

, 8

1,

081.

1

9.

Mt.

Ken

ya E

ast p

ilot p

roje

ct fo

r na

tura

l res

ourc

es m

anag

emen

t (M

KE

PP-

IFA

D/G

EF/

GO

K/C

omm

uniti

es)

To

redu

ce p

over

ty th

roug

h im

prov

ed

food

sec

urity

and

impr

ovin

g le

vels

of

inco

me

of fa

rmer

s an

d ru

ral w

omen

by

prom

otin

g m

ore

effe

ctiv

e us

e of

nat

ural

re

sour

ces,

impr

ovin

g ac

cess

to w

ater

an

d in

trod

ucin

g be

tter

farm

ing

and

man

agem

ent p

ract

ice.

GO

K, I

FAD

, G

EF,

136

,000

ho

useh

olds

(5

80,0

00

peop

le)

5 di

stri

cts

– E

mbu

, Mer

u C

entr

al, M

eru

Sout

h, M

beer

e,

Tha

raka

2,11

0 20

04-2

011

1, 2

, 5, 7

, 8

1,

511.

5

40

10

. M

wea

Irri

gatio

n D

evel

opm

ent

Proj

ect (

MID

P-G

OK

/JIC

A)

To

incr

ease

irri

gate

d ri

ce a

rea

by 1

,700

ha

in M

wea

irri

gatio

n sc

hem

e.

GO

K, J

ICA

, bu

ildin

g co

ntra

ctor

s,

farm

ers,

mill

ers

Mw

ea Ir

riga

tion

Sche

me.

13

,178

30

-yea

r loa

n,

untie

d

2010

-201

6 1,

2, 6

1,21

5.5

Sour

ce: M

OA

web

site

- ht

tp://

ww

w.k

ilim

o.go

.ke

– M

OA

, Pro

gram

mes

and

Pro

ject

s at

a G

lanc

e, M

ay 2

010.

The

det

aile

d br

eakd

own

of p

roje

cts

by d

istr

ict i

s al

so a

vaila

ble

at

this

web

site

in a

n E

xcel

file

. B

esid

es th

ese,

ther

e ar

e nu

mer

ous

othe

r sm

all i

nitia

tives

con

trib

utin

g to

var

ious

deg

rees

to th

e N

RD

S su

ch a

s th

ose

show

n in

Tab

le 3

.5 b

elow

. Table 3.5: S

mall projects with an input for NRDS

No.

Nam

e Funding Agency

Objective

Expected outcom

e Funding

KShs

Period

NRDS sub-

sector &

related budget,

KShs M

1.

Stat

e of

Com

petit

ion

in

Agr

icul

tura

l Sec

tor:

A C

ase

of M

illin

g an

d B

ulk

Stor

age

in K

enya

Inst

itute

of

Eco

nom

ic A

ffai

rs

(IE

A),

Ken

ya

Ana

lyse

the

stat

e of

co

mpe

titio

n in

the

agri

cultu

ral s

ecto

r, w

ith

spec

ific

refe

renc

e to

the

mill

ing

and

bulk

sto

rage

m

arke

ts

Add

ress

the

wea

knes

ses

iden

tifie

d an

d to

si

gnif

ican

tly im

prov

e th

e sc

ope

of c

ompe

titio

n by

ap

plyi

ng b

oth

com

petit

ion

and

regu

lato

ry-b

ased

re

med

ies

96,0

00

05/1

0-07

/10

8

55

2.

Map

ping

out

the

Inst

itutio

nal-

Polic

y an

d Is

sues

Aff

ectin

g Sm

all-

Scal

e Fa

rmer

s an

d O

ptio

ns fo

r E

nhan

ced

Prod

uctiv

ity a

nd

Mar

ket A

cces

s D

evel

opm

ent

in K

enya

Ford

Fou

ndat

ion,

O

ffic

e of

Eas

tern

an

d So

uthe

rn

Afr

ica,

Nai

robi

Con

trib

ute

to p

over

ty

redu

ctio

n an

d im

prov

emen

t of

livel

ihoo

ds in

Ken

ya

thro

ugh

impr

oved

ag

ricu

ltura

l pro

duct

ion

and

sust

aina

ble

acce

ss o

f Sm

allh

olde

r pro

duce

rs to

m

arke

ts

Info

rmat

ion

to b

e us

ed to

in

itiat

e a

smal

l-sc

ale

farm

er’s

mov

emen

t in

Ken

ya, b

y w

hich

the

farm

ers

grou

ps a

re

prov

ided

the

know

ledg

e to

co

ntri

bute

in th

e pr

oces

s of

ev

olvi

ng a

nd

impl

emen

ting

rele

vant

po

licie

s re

sulti

ng in

po

vert

y al

levi

atio

n

960,

000

04/1

0-06

/10

8

55

41

4. DETERMINATION OF UNSATISFIED NEEDS 4.1 Needs in the Operational Domain Needs in the operational domain include:

i) Infrastructure • Seed storage facilities • Temperature regulated stores for bulk seeds • Seed storage freezers for breeders seed • Adequate area for seed multiplication in the research centres • Adequate area for variety evaluation • Fully equipped laboratories for seed analysis • Seed processing equipments • Rice harvesting machines

There is no data to suggest that the situation reported in the NRDS a year ago has changed. The need for all the above facilities therefore exists.

ii) Human resource requirements The human resource requirements for the NRDS are shown in Table 4.1. Whereas with the creation of the new districts the need for the new field staff positions has arisen, and considering that rice is grown in all the high and medium potential agricultural areas nationwide it is beyond the scope of this study to determine how many of these positions have been filled and how many are yet to be filled. However, the extension capacity of the NIB and the LBDA remains intact in the Central, Western and Nyanza provinces where the major rice irrigation projects are situated. The total dedicated human resource requirement for efficient implementation of the NRDS is shown in Table 4.1. Table 4.1: Number of Researchers, Technicians and Extension Workers in 2008 and

Targets in future Years Year Agricultural Researchers with

MA or PhD. Research Technicians Extension Workers

Total Rice specialists (part time)

Rice specialists (full time)

Total Rice specialists (part time)

Rice specialists (full time)

Total Rice specialists (part time)

Rice specialists (full time)

2008 20 12 8 48 20 28 817 685 132 2013 32 16 16 60 26 34 899 754 20 2018 56 22 34 84 32 52 989 829 160 Source: NRDS, 2009 The one gap that still prevails in the recruitment of researchers, research technicians and extension staff is the funding of the extension service through the treasury to facilitate their mobility on a regular basis and in accordance with a pre-set schedule. Any such gaps are reported upon and budgets forwarded from the district for inclusion in the annual printed estimates though inadequacy of funds often leads to these estimates being inordinately slashed and positions remaining vacant.

iii) Financing It is necessary to strengthen the Agricultural Finance Corporation whose core business it is offer seasonal and farm development credit. Good progress has so far been recorded.

42

4.2 Needs in the structuring domain 4.2.1 Policies The recent banning of importation of low grade rice is a welcome move in protecting the local market and giving the local rice producer and advantage. There is however, substantial cross-border informal trade between the EAC countries making it difficult to control the flow of rice into the Kenya market from neighbouring countries. A policy of ensuring close monitoring of this cross-border trade would go along way into determining the points of entry and controlling such inflow. 4.2.2 Institutional issues The institutional roles envisaged in the NRDS are as follows – Table 4.2: Table 4.2: Institutional Roles Activity Institution Variety Development KARI/NIB (in collaboration with International Research Institutions) Variety evaluation KARI&NIB, Universities with MOA and farmers as observers Breeder seed KARI/NIB /Public Private breeders, KEPHIS Foundation seed KARI/NIB/Public/Private breeders, KEPHIS Registered seed KARI & NIB, Public, Private Sector, KEPHIS Certified seed Seed merchants, NIB, MOA, KARI, KEPHIS

4.3 Costs of unsatisfied needs - Operational domain and structuring domains This report has taken the view that the total budgetary needs of implementing the NRDS are determined in the NRDS implementation framework and presented herewith in Table 4.3. While it was possible to determine the NRDS subsectors relevant to the on-going government projects, it is not possible within this study to alienate the exact project commitment assigned to rice development. However, it is expected that project budgets assigned to extension and the other NRDS sub-sectors mentioned in the matrices will meet portions of the NRDS budget. To ascertain this would require a mid-term review of NRDS implementation which would conduct an audit of its expenditure and sources of funding. On the basis of the above, it can be stated that the first 5-year NRDS estimated budget of US$ 25 million is as yet to be funded. However, since government activities are still proceeding, funding is on-going through the normal expenditure of the MOA TABLE 4.3: NATIONAL RICE DEVELOPMENT STRATEGY MPLEMENTATION

FRAMEWORK FINANCING PLAN (2008-2013) STRATEGIC OBJECTIVE 1. INCREASE RICE YIELD PER UNIT AREA IN RAIN FED AND IRRIGATED CONDITIONS

TIME FRAME REQUIRED RESOURCES

KSHS (Million )

SOURCE OF FUNDING & AMOUNT KShs Million

1.1 High yielding pest and disease resistant varieties developed

1.1.1 Develop varieties resistant to rice blast and other endemic diseases and pests

2008/2013 10.0

1.1.2 Screen existing varieties 2008/2013 5.0 1.1.3 Breeder seed bulking 2008/2013 5.0

43

1.1.4 Capacity building 2008/2013 3.0 Sub-total 1.1 23.0 1.2 Appropriate Agronomic practices for

different cropping systems. 2008/2013

1.2.1 Trials on fertilizer rates 2008/2013 5.0 1.2.2 Weed control trials 2008/2013 5.0 1.2.3 Diversification in irrigated rice 2008/2013 8.0 1.2.4 Establish rice crop rotational systems 2008/2013 8.0 Sub-total 1.2 2008/2013 26.0 1.3 Improve soil and water management

techniques in rice production.

1.3.1 Develop efficient water use technologies 2008/2013 6.8 1.3.2 Develop technologies for utilization of

problematic soils (salinity and iron toxicity)

2008/2013 6.8

Sub- total 1.3 13.6 1.4 Appropriate pest and disease control technologies

1.4.1 Identify, validate and disseminate IPM strategies

2008/2013 4.8

1.4.2 Identify suitable chemicals for pest and disease control

2008/2013 4.0

1.4.3 Introduce biotechnology for control of rice blast

2008/2013 9.8

Sub-total 1.4 18.6 1.5 High quality seed and supply system 1.5.1 Evaluate and characterize rice lines. 2008/203 3.75 1.5.2 Sufficient breeder and basic seed

maintained by the breeding institutions. 2008/2013 3.25

1.5.3 Produce adequate commercial seed for the targetted areas.

2008/2013 15.0

1.5.4 Identify, train and certify commercial seed producers

2008/2013 5.0

Sub-total 1.5 27.0 STRATEGIC OBJECTIVE 2. IMPROVE AND EXPAND IRRIGATION AND RAIN-FED RICE

PRODUCTION 2.1 Expand area for rain-fed and

irrigated rice production

2.1.1 Rehabilitation of existing rice schemes 2008/2013 200.0 2.1.2 Construction of new irrigation schemes 2008/2013 800.0 14,000* 2.1.3 Farmer mobilization for rain-fed rice

production 2008/2013 5.0

Sub-total 2.1 1,005.0 2.2 Identify and improve appropriate mechanization techniques for all rice operations 2.2.1 Procure equipments for rice production 2008/2013 5.0 2.2.2 Demonstrate identified equipment for

rice operations 2008/2013 3.2

2.2.3 Build local capacity for local production of implements

2008/2013 2.9

Sub-total 2.2 11.1 STRATEGIC OBJECTIVE 3. FIELD AND POST HARVEST LOSSES REDUCED 3.1 Improve on farm storage 3.1.1 Train on field and post harvest losses 2008/2013 3.0 3.1.2 Develop technologies on reduction on

field and post harvest losses 2008/2013 5.0

3.1.3 Install drying sheds, driers and stores 2008/2013 10.0 Sub-total 3.1 18.0 3.2 Increase value addition techniques

44

3.2.1 Build capacity on value addition techniques

2008/2013 3.9

3.2.2 Develop new value addition technologies

2008/2013 3.0

Sub-total 3.2 6.9 STRATEGIC 4. SUSTAINABLE ACCESS OF AFFORDABLE CREDIT, HIGH QUALITY INPUTS AND SEED TO FARMERS 4.1 Establish adequate production,

distribution and marketing of high quality seed.

2008/2013

4.1.1 Identify and build capacity of rice seed producers

2008/2013 2.5

Sub-total 4.1 2.5 4.2 Improve farmers access to high quality inputs

4.2.1 Identify and build capacity of stockists in provision of high quality inputs

2008/2013 1.5

4.2.2 Demonstrate input use in rice 2008/2013 25.0 Sub-total 4.2 26.5 4.3 Improve farmers access to affordable credit

4.3.1 Build capacity of farmers for credit acquisition and utilization

2008/2013 3.0

Sub-total 4.3 3.0 STRATEGIC OBJECTIVE 5.0 FACILITATE INCREASED PRODUCTION AND PRODUCTIVITY THROUGH IMPROVED EXTENSION ADVISORY SUPPORT SERVICES AND TECHNOLOGY DEVELOPMENT AND DISSEMINATION 5.1 Strengthen extension service provision 2008/2013 5.1.1 Train and deploy rice development

officers in rice growing areas 2008/2013 12.4

5.1.2 Facilitate private sector participation in technology dissemination

2008/2013 5.8

5.1.3 Technical backstopping 2008/2013 7.5 Sub-total 5.1 25.7 5.2 Establish infrastructure support for extension

2008/2013

5.2.1 Acquire necessary facilities for supporting extension services (50 vehicles and 200motorcycles)

2008/2013 160.0

5.2.2 Transport operating expenses 2008/2013 125.0 Sub-total 5.2 285.0 5.3 Strengthen research –extension – farmer linkages

5.3.1 Establish farming systems teams in the target areas

2008/2013 3.5

5.3.2 Establish a working rice knowledge bank (data base)

2008/2013 5.0

Sub-total 5.3 8.5 5.4 Address human health issues to prevent and control malaria and water borne diseases in irrigated systems

5.4.1 Establish collaboration with Ministry of Health and cross cutting issues.

2008/2013 3.0

Sub-total 5.4 3.0 STRATEGIC OBJECTIVE 6. BUILD ADEQUATE TECHNICAL CAPACITY FOR RICE PRODUCTION

6.1 Develop critical professional capacity in

45

rice production 6.1.1 Undertake professional staff training in rice production

2008/2013 25.5

6.1.2 Professional staff familiarization tours 2008/2013 2.7 Sub-total 6.1 28.2 6.2 Create enabling environment for motivation and retention of staff in rice research and extension

6.2.1 Train, promote and improve conditions of service for rice staff

2008/2013 -

6.3 Build capacity of farmers in rice production

2008/2013

6.3.1 Train farmers on rice production technologies

2008/2013 -

6.3.2 Study tours for farmers 2008/2013 6.0 Sub-total 6.3 6.0 6.4 Improve rice research support services and technology development

6.4.1 Provide research infrastructure 2008/2013 30.0 6.4.2 Purchase and operations of 5 vehicles and 10 motorcycles

2008/2013 23.0

6.4.3 Develop, package, disseminate and promote appropriate technologies

2008/2013 1.5

6.4.4 Develop networks and partnerships for information sharing

2008/2013 2.5

Sub-total 6.4 57.0 STRATEGIC OBJECTIVE 7. DEVELOP AND STRENGTHEN STAKEHOLDER NETWORKS AND PARTNERSHIPS 7.1 strengthen stakeholder networks and partnerships

7.1.1 Mobilize farmers to form rice common interest groups (CIGs)

2008/2013 5.0

7.1.2 Establish rice apex farmers association 2008/2013 5.0 Sub-total 7.1 10.0 7.2 Establish stakeholders forum at all levels

and link them to networks -

7.2.1 form stakeholder forums 2008/2013 - STRATEGIC OBJECTIVE 8.0 MARKET AND MARKETING DEVELOPMENT 8.1 Develop appropriate rice marketing policy

8.1.1 Initiate enactment of rice marketing policy

2008/2013 -

8.2 Establish private – public sector partnership in marketing

2008/2013

8.2.1 Train and sensitize partners on the benefits of joint marketing

2008/2013 -

8.3 Develop value addition techniques in rice 2008/2013 8.3.1 Identify and promote value addition techniques

2008/2013 -

8.4 Promote access for ICT to link farmers to the markets

8.4.1 Train farmers on ICT on e-marketing 2008/2013 10.0 8.4.2 Construct e-learning centers in every region

2008/2013 30.0

8.4.2.1 Equip the centre with e-learning infrastructure

2008/2013 15.0

Sub-total 8.5 55.0 8.5 Ensure quality of imported rice 8.5.1 KEBs to appoint pre-shipment inspector 2008/2013 -

46

*JICA-funded Mwea Irrigation Development Project.

at the point of export Sub-total 8.5 - STRATEGIC OBJECTIVE 9.0 PARTICIPATORY MONITORING AND EVALUATION (PM & E)

9.1 Establish an efficient monitoring and evaluation system

2008/2013

9.1.1 Develop PM & E framework and reporting system

2008/2013 3.0

9.1.2 Monitor and establish the status of rice in the country (baseline survey)

2008/2013 5.0

9.1.3 Monitoring and Evaluation 2008/2013 30.0 Sub-total 9.1 38.0 10.0 CO-ORDINATION ACTIVITIES 10.1Meetings (secretariat) 2008/2013 5.0 10.2 Monitoring 2008/2013 25.0 10.3 Operations 2008/2013 12.5 10.4 External travel 2008/2013 17.5 10.5 Participation in shows and field days 2008/2013 5.5 Sub-total 10.1 65.5 GRAND TOTAL 1,763,100

USD 25.0 Million 14,000

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5. OPPORTUNITIES FOR MEETING THE UNSATISFIED NEEDS 5.1 NRDS Subsectors According to the status report of the implementation of the NRDS presented to the rice Stakeholders Forum on September 16, 2010, the unsatisfied needs to achieve the targets set for 2018 are in the following subsectors of the NRDS:

• Farmers lack the required rice production technologies • Inadequate seed supply • Lack of rice production and processing equipment • Lack of sustainable access to affordable credit • Lack of quality farm inputs • Infestation by insect pests and diseases • Inadequate funding

5.2 Rice Value Chain Analysis Findings The aim of the rice value chain (RVC) study was to seek a detailed understanding of the actors, activities, costs, challenges and opportunities related to the flow of rice and associated services from producers, processors, buyers and/or consumers. The actors identified in the RVC from input supply through production, handling, processing and marketing to the final consumer are presented in Table 5.1. Table 5.1: Actors in the Rice Value Chain

Specific input and service providers

Primary producers

Logistic centres, industries

Traders Consumers

Input merchants- agrovets, agro-chemical companies

Tenant farmers/ leaseholds

Multi-purpose cooperatives

Buyers Households

Research-KARI, MIAD

Owner cultivators

International & non-govt. –FAO, JICA

Middlemen Business & institutional buyers

Extension - MOA, NGOs

Farm workers GOK - NIB Importers Allied industries

Credit providers Rice millers Small & large processors

Land preparation services

Source: Rice Value Chain Study, 2010 Opportunities abound in engaging the various players in the rice value chain in doing what they do best for gain. Other than the government and its various public agencies, the RVC players are in it for a livelihood. It is therefore necessary to interest them to continue playing their roles by making those roles a source of profit and livelihood. Issuance of title deeds to rice land, expansion of rice production, improvements in the market place, construction of an

48

efficient road network to reduce costs of transport and supply of affordable energy in the rice growing areas are only some of the measures that could create opportunities for input suppliers, millers, traders and other players to heighten their engagement in rice. Good producer prices mean a good income and reduction of risks on the part of the farm credit and other service providers. The role of creating these opportunities lies initially with the government as it starts to implement the NRDS by assigning funding to its estimated budget. Results showed that:

• Approximately 37 % of the farmer respondents had acquired credit for rice production • 63% had never taken a loan for rice or agricultural production purposes. • Some of the institutions involved in providing credit to farmers were Equity Bank, K-

REP bank, Farmer cooperatives, microfinance organizations and private money lenders.

Farmers cited the following reasons for non-use of credit:

• Not aware of loan - 25.7% • Have own finances -12.2% • Lack of security/collateral – 49.9% • Loan not available - 2.7% • Fear of loan - 9.5%

There is need to educate farmers in the management and use of finances and especially how to acquire and use credit The study further established that extension services in rice-producing areas were provided by:

� MOA - 43.2 % � KARI - 4.05 % � MIAD - 4.05% � NIB - 4.05% � Other farmers -1.35 % � No access to extension services - 43.2 %

Approximately 43% of farmers had no access to extension services indicating that there is need for deployment of additional extension staff trained in rice production and rice related issues to the irrigation schemes and other areas where rice is grown. Farm input supply: Various inputs used by farmers in rice production translating to costs and finding their way into the gross margin calculation include Seed, Crop establishment, Water supply, Pesticides, Fertilizer, Transport, and Labour Conclusions of the value chain study

• Rice production in the various rice production systems was profitable. • Rice yields are low (average 4.1 MT/ha) and output on rice farms has been declining

over time. • Low availability of water for irrigation was found to be a constraint to farmers in

irrigation schemes especially in Mwea. • There were prohibitively high charges for operations and maintenance services

especially in irrigation schemes in western and Nyanza regions. Ways should be found to lower these charges to improve profitability of rice production in these areas.

49

• Currently, the milling capacity in the country is not fully utilized. Most of the mills were concentrated in central Kenya with very few of them in rain-fed rice producing areas (e.g. Marakwet and Coast Province).

• Currently there is little value addition in the form of new products arising from the milling process.

5.3 Relevant Opportunities for Increasing rice Production in Kenya As a starting point, Kenya offers the following opportunities for rice development:

• Abundant human resources: Kenya is endowed with a massive but underused human resource capacity. Primary, secondary and post-secondary education has expanded and produces thousands of graduates each year. This resource can be used to change the face of agriculture in training and research to develop new and relevant technologies, and to create and expand agribusiness.

• New and expanding markets: Kenya is uniquely placed to take advantage of

expanding domestic, regional and international markets. Due to the diverse agro-ecology, the country can produce a wide range of temperate, tropical and subtropical products. Large and expanding markets for traditional products like maize and other cereals, beef and dairy products, tea, coffee and pyrethrum exist.

• Potential for increasing production: Not much effort has been put to increasing

production of traditional commodities in Kenya. Agricultural productivity can be increased in multiples through better use of unused land in traditional farming areas, and through irrigated agriculture.

• Vast irrigation potential: Kenya’s irrigation potential is estimated at 540,000 ha of

which only about 105,000 ha is exploited. The potential for exploiting irrigation can be expanded by 1 million ha by developing the Tana and Athi river basins. Lake Victoria has a 253-km shoreline in Kenya that is basically unused despite the huge irrigation potential.

• Potential for increasing yields: Yields of crops and livestock are far below their

optimum. Yields of maize, sugar and dairy are one-tenth of global potential. Rice yields are also way below potential, a situation that can be remedied by observing appropriate planting, fertilizer application and other cultural practices.

• Value addition: Value addition includes processing, branding, quality certification

and accreditation, as well as farm-level quality improvements that the market values. It is estimated that 91 per cent of total agricultural exports are in raw or semi-processed form. Thus, the country loses billions in earnings by not adding value to its produce.

Exploitation of this potential will lead to the realisation of the targets contained in Table 5.2 below which satisfy the NRDS to 2018.

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Table 5.2: District Data and Potential of Rice Production Increase to 2010 PROVINCE District Ecology Current

Production (tons)

Potential Production Characteristics of Intervention of Natural &

Social Environments

Financially, Technically Feasible by

2018

1 2

WESTERN Butula Upland 194 1,552 NERICA Bumula Upland 122 976 NERICA Teso North

Upland 369 2,952 NERICA

Teso South

Upland 315 2,520 NERICA

Samia Upland 259 2,072 NERICA Busia Upland 221 1,768 NERICA Matungu Upland 72 576 NERICA Bungoma Upland 101 808 NERICA Bunyala Irrigated 852 30,000 852 NERICA Butere Mumias

Upland 25 200 NERICA

Sub-total 2,355 30,000 14,276 NYANZA Kisumu Upland 2,190 17,520 NERICA

Kisumu East

Irrigated 6,804 6,804

Nyando Irrigated 3,420 75,000 10,000 Rehabilitation Irrigation

NERICA

Muhoroni Irrigated Upland

Homa Bay

Upland 1,022 8,176 NERICA

Bondo Upland 410 3,280 NERICA Kuria Upland 12 96 NERICA Migori Upland 15 120 NERICA Siaya Upland 128 1,024 NERICA

Ahero Irrigated 9,018 9,018 Sub-total 10,605 75,000 56,038 COAST Taveta Low

land rainfed

400 24,000 3,200 Rehabilitation Irrigation

New variety

Upland 1 28,000 8 NERICA Kaloleni Low

land rainfed

320 1,800 2,560 NERICA

Upland Msambweni

Low land rainfed

596 4,768 NERICA

Lamu West

Low land rainfed

17,000

Upland 20 8,000 160 NERICA Tana Delta

Low land rainfed

60 68,000 480 Rehabilitation Irrigation

NERICA

Upland 20 160 NERICA

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Tana River

Low land rainfed

50 400 NERICA

Upland Kwale Low

land rainfed

Upland 80 1,600 640 NERICA Sub-total 1,147 148,400 12,376 CENTRAL Kirinyaga

south Irrigated-Mwea

33,900 68,300 68,300 Thiba Dam, etc.

JICA Project

Kirinyaga west

1,704 13,632 NERICA

Kirinyaga east

50 400 NERICA

Kirinyaga central

Upland 1,318 10,544 NERICA

Muranga East

Upland 84 672 NERICA

Sub-total 93,548 RIFT VALLEY

Marakwet Upland 1 8 NERICA

Sub-total 37,057 68,300 8 Total 64,153 321,700 176,246 Current and 10-year projection (73,141) (178,580)

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6. CONCLUSION AND RECOMMENDATIONS 6.1 Key Stakeholders in the Rice Value Chain Irrigation and drainage development is a multi-disciplinary and multi-institutional undertaking. The main professional disciplines involved include: engineers, agronomists, soil scientists, hydrologists, economists, planners, public health, farmers, traders, millers and politicians. Key players in the rice value chain are presented in Table 5.1 above. 6.2 Actions required to improve the status of the rice value chain 6.2.1 Recommendations from the Rice Value Chain Study The RVC recommends the following ways to increase rice output on farms and hence improve income and nutrition and the general status of the rice value chain:

1. To improve incomes from rice there is need to: • introduce other crops such as soya beans, tomatoes and other horticultural crops

that can be grown in the off-season after the major rice crop to utilize slack labour.

• encourage farmers to grow the rice ratoon crop after harvesting the main crop.

2. There is need to improve rice yields which in turn will improve rice farmers’ incomes and livelihoods.

3. Farmers should adopt water harvesting technologies to enhance water use. 4. More dams should be constructed to trap and conserve water for irrigation purposes in

order to increase water for irrigation and expand irrigated area. 5. Ways should be found to reduce O&M charges to improve profitability of rice

production in Nyanza and Western Kenya. 6. Public and private sector organizations should develop training programmes geared

towards creating awareness and building capacity of farmers on financial management.

7. Credit providers including banks should: • Banks and other credit providers should provide small-holder farmer-friendly

credit to enhance uptake of rice technologies and improve rice outputs. • Institutions for regulation of the credit market need to be strengthened so as to

enforce lending rules and regulations to ensure that farmers and those using credit are protected from exploitation.

8. Private sector should be encouraged to invest in rice milling and value addition. 9. Human capacity development for rice research and extension is required to enhance

development and uptake of rice technologies in Kenya. 6.2.2 Actions from the Implementation of the NRDS Stakeholder meetings have been held and roles for the implementation of the NRDS spelt out and agreed upon between the MOA, KEPHIS, KARI and other players. The following plans are in full gear: 1. Setting of norms for seed field inspections (Table 6.1) 2. Setting of norms for seed laboratory analyses (Table 6.2) 3. Preparation of the seed production schedule for NERICA (Table 6.3)

Table 6.1: Norms for field inspections

Table 6.2: Norms for laboratory analyses

Types of analyses

Varietal purity (min) Specific purity (%) Germination rate (%) Moisture content (max) Inert matters (max) Seed of other cultivated species (max)Noxious weed seeds (max) Red rice (max) Source: KEPHIS

Table 6.3: Provisional Seed Production Schedule (NERICA No.4)

Year Season Nucleus Seed

Breeder's Seed

(No. of (No. of

grains)*1 hills)*2

2011 LR 10

SR 20

2012 LR 10

SR 40

2013 LR 10

SR 60

2014 LR 15

SR 80

2015 LR 20

SR 120

2016 LR 30

SR 240

2017 LR - *3

SR - *3

2018 LR - *3

SR - *3

Criteria

Minimum isolation (in meters) Maximum percentage of off-types (%)Maximum percentage of diseased plants (%)Seeds of other cultivated species (%)Maximum percentage of dangerous weeds (%)

Table 6.1: Norms for field inspections

: Norms for laboratory analyses Breeder seeds

Foundation seeds

Certified seedsR1

999 ‰ 999 ‰ 997 ‰98% 98% 98%80% 80% 80%12% 12% 12%2% 2% 2%

Seed of other cultivated species (max) 10 seeds/kg 10 seeds/kg 0.5%10 seeds/kg 10 seeds/kg 0.5%

0 0 5 seeds/kg

Provisional Seed Production Schedule (NERICA No.4)

Breeder's Pre-Basic Seed

Basic Seed

Certified Seed

Target Areas(ha)

Production (kg) (ton) (ton) Upland

(kg)

20 0.5

25.0

40 1.0 1.5

50.0 100.0 1,500

60 1.5 3.0

75.0 200.0 3,000

80 2.0 5.0 1,000

100.0 350.0 5,000

120 3.0 8.0 1,500

150.0 525.0 7,500

240 6.0 10.0 2,000

300.0 750.0 10,000

20.0 2,000

- *3 1100.0 13,000

- *3 2,000

Breeder seeds

Foundation seeds

10 5 types (%) 0.05 0.05

Maximum percentage of diseased plants (%) 0.01 0.01 Seeds of other cultivated species (%) 0.01 0.01 Maximum percentage of dangerous weeds (%) 0.01 0.01

53

Certified seeds R1 R2

997 ‰ 990 ‰ 98% 98% 80% 80% 12% 12% 2% 2%

0.5% 0.5% 0.5% 0,5%

5 seeds/kg 5 seeds/kg

Target Areas

Irrigated Total

(Mwea)

1,500 5 1,505

500 500

3,000 30 3,030

1,000 1,000

5,000 300 5,300

1,500 1,500

7,500 1,000 8,500

2,000 2,000

10,000 3,000 13,000

2,000 2,000

13,000 7,000 20,000

2,000 2,000

Certified seeds

3 0.3 0.5

0.02 0.02

54

Notes *1: Obtained from AFRICARICE. *2: If panicles (ears) are to be selected, numbers should be simply multiplied with 10 (e.g. 20 x 10 = 200, 2011SR). *3: Amount should be calculated according to the estimation beyond 2019

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BIBLIOGRAPHY

1. for Mwea Irrigation Development Project, Final report Volume II: Annex, October 2009. 2. African Studies Centre, Leiden, © 2010 ASC, Leiden at 3. Development Strategy and Policy Paper, no. 5. Stichting DLO: Wageningen. Available at: 4. Emongor, R. A et al, Rice Value Chain Study Report for Kenya, February 2010 5. Henry Ekwuruke, “Coalition for African Rice Development launched”, AfricaFront.com,

May 31, 2008 6. http://www.ascleiden.nl/Library/AnnualDevelopmentPlans/adp_kenya.aspx

Page revised on February 3, 2005, (visited October 27, 2010) 7. http://www.ncpb.co.ke/index.php?option=com_content&task=view&id=31&Itemid=46

(visited 2.10.2010) 8. http://www.boci.wur.nl/UK/Publications/

http://www.nesc.go.ke/News&Events/KenyaVision2030Intro.htm 9. IMF Country Report No. 05/11 10. Institute of Economic Affairs, (June 2009), Budget 2009/2010, A Guide for MPs 11. International Monetary Fund, PRSP Factsheet, September 2010 12. James Nyoro, (2006), Compatibility of Trade and Domestic Policy Affecting Staples in

Kenya, Tegemeo Institute, Egerton University 13. Jan Willem Gunning, Budget Support, Conditionality and Impact Evaluation,

Practitioners’Forum on Budget Support, May 5-6, 2005 Cape Town, South Africa. 14. Katherine Muoki, Development Planning and Equality in Kenya, Opportunities and

Challenges, Ministry of Planning, National Development and Vision 2030 – Kenya 15. Kenya Plant Health Inspectorate Service, annual report and Financial Statements, July 2008-

June 2009, September 2009 16. Kenya Plant Health Inspectorate Service, annual report and Financial Statements, July 2007-

June 2008, September 2008 17. Kiringai, Jane and D. K. Manda, (2002), The PRSP Process in Kenya, Second Meeting of the

African Learning Group on the Poverty Reduction Strategy Papers (PRSP-LG), 18-21 November 2002, Brussels, Belgium.

18. Martin Knoll, United Nations Conference on Trade and Development, Budget Support: A Reformed Approach or Old Wine in New Skins? Discussion paper No. 190, October 2008. (There are recorded cases of an uncoordinated multiplicity of donor conditionalities that have impeded disbursement of budget support funding calling for greater donor conditionality harmonization.)

19. Meijerink, G. & P. Roza. 2007. The role of agriculture in development. Markets, Chains and Sustainable

20. NCPB at 21. Patrick O. Alila and Rosemary Atieno, (July 2006), Agricultural Policy in Kenya: Issues and

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

22. Republic of Kenya (2005). Economic Survey 2005. Government Printer, Nairobi. 23. ______________ (2008), PRSP First Medium Term Plan, 2008 – 2012 24. ______________, Ministry of Water and Irrigation, (2009), Irrigation and Drainage Master

Plan. 25. ______________, SRA Final p. Xii 26. ______________, Agricultural Sector Development Strategy 2010-2020, 2010

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27. ______________, Guidelines on Upland rice Cultivation in Kenya, March 2009 28. ______________, Kenya Vision 2030, A Globally Competitive and Prosperous Kenya,

October 2007 29. ______________, Ministry of Agriculture, National Rice Development Strategy (NRDS)

Implementation Framework (2008-2013), 2010 30. ______________, Ministry of Agriculture, National Rice Development Strategy (NRDS)

(2008-2018), 2009 31. ______________, Ministry of Agriculture, Rice Promotion Unit, NERCA Sustainable

Dissemination Project, September 2010 32. ______________, Ministry of Water and Irrigation, Irrigation and Drainage Master Plan,

June 2009 33. ______________, Road Map to Increase rice in Kenya, September 2010 34. ______________, The Kenya CAADP Compact, July 2010 35. ______________/JICA, Lake Basin Development authority, Feasibility Study on Kano Plain

Irrigation Project, Volume I Main Text, January 1992 36. ______________/JICA, National irrigation Board, Special Assistance for Project

Formulation 37. Roger D. Norton, Agricultural Development Policy: Concepts and Experiences, FAO, 2004

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ANNEXES A: CASE STUDIES Case Study 1: Kenya Plant Health Inspectorate Service (KEPHIS) The core mandate of KEPHIS is to undertake services in plant variety protection, seed quality control, plant protection; and quality control on agricultural inputs and produce. KEPHIS is also involved in preparation of national development strategies in the agricultural sector. Specifically KEPHIS takes part in:

a) Conducting of the National Performance Trials (NPT) and Distinctness, Uniformity and Stability tests (DUS) for various crop varieties. Fourteen (14) rice varieties have been released after going through the tests.

b) Conducting field inspections of rice seed c) Processing of seed rice in the factories d) Rice seed testing e) Conducting Post Control Tests (PCT) f) Post certification surveys g) Updating of the National Variety List (NVL) h) Granting of plant breeders rights

KEPHIS is not currently holding any dialogue or having plans with any development partners for funding of rice development activities. The principle roles KEPHIS plays in the rice value chain in Kenya are:

a) Collaborate with research scientists in varieties development and maintenance b) Regulate varieties release mechanism c) Quality control during rice seed production and distribution

For KEPHIS to have the required capacity in terms of human and other resources to engage fully in rice development they require training of seed inspectors in modern rice seed production.

Looking at the entire rice value chain, the measures/changes that KEPHIS feels are required to improve rice production, processing, marketing and consumption in Kenya are to ensure availability of high yielding rice varieties, and high quality seed and fertilizers to the farmers. Those breeding rice varieties should consider what consumers prefer. With the necessary resources, KEPHIS can implement these measures in collaboration with KARI research scientists, seed companies and the Ministry of Agriculture.

________________________________________________________________________________

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Case Study 2: Marakwet West District Agricultural Office Marakwet West district is in the Rift Valley where only rainfed NERICA can be grown. The DAOs office is not directly involved in policy and strategic planning at the national level. However, it:

i) Participates at District level when identifying causes of poverty and possible interventions, especially when outlining district priority areas of intervention.

ii) Participates by inputting to the national rice strategy at meetings. iii) Participation at the National Rice Stakeholders Forum and particularly in reviewing rice

sector policy proposals. iv) Marakwet West district is implementing the NERICA rice dissemination programme. v) In the course of implementation of the NERICA rice dissemination programme, the DAO’s

office draws work plans and budgets for activities implementation in the district. No funding dialogues are held at the district level as the district is part of the centralised government planning process. The dialogue is not directly with the district offices but rather Ministry of Agriculture headquarters. There are partnerships with JICA, CARD on rice promotion. The principal role of the DAO’s office in the rice value chain in Kenya is mainly:

i) Provision of extension services to farmers growing rice in Marakwet West district with training conducted on all aspects of the rice value chain.

ii) NERICA seed bulking and promoting the crop in the district which will lead to increased acreage of rice.

iii) Formation of Marakwet West District NERICA Working group that will look into challenges facing rice farming in Marakwet West.

iv) Linking of farmers to other value chain players like processors, marketers, etc.

District offices generally consider sound policy formulation and continuous lobbying for funds from treasury; and lobbying by Ministry of Agriculture and stakeholders for high priority rating of rice as a staple food. This is considered the surest ways to mainstream investments in rice value chains into national budgets so as to benefit from allocations coming from the treasury. Funds can also be raised by preparing and presentation of proposals on rice value chain for government and donor funding. The DAO’s offices are currently relying on the National Development Plan but at district level, there are hopes to:

i) Continue with the provision of agricultural extension services to farmers growing rice in Marakwet West district.

ii) Expand on NERICA seed bulking. iii) Expand on the rice acreage to attain reasonable volumes. iv) Encourage investment on processing equipment once reasonable volumes are achieved.

Institutional measures necessary for the district office to have the required capacity in terms of human and other resources to engage fully in rice development are:

i) Streamlining the rice promotion efforts across the country. ii) Enhanced capacity building of all the staff in the rice growing areas. iii) Strengthening of linkages among the rice value chain players with a view to increased

investment in rice processing equipment in the rice growing areas by either the government or private stakeholders.

The rice value chain requires the following measures/changes to improve rice production, processing, marketing and consumption:

i) Capacity building of farmers, researchers and extension workers involved in the rice value chain.

ii) Greater investment in rice processing equipment (mills) in the rice growing areas. iii) Increasing the acreage of rice by targeting areas that were not traditionally rice growing

areas to grow rice.

59

iv) Streamlining of marketing especially through empowerment of the rice producers. v) Enhanced rice consumption promotion campaigns.

These measures should be implemented variously by all stakeholders in the rice value chain but with key institutions like the Ministry of Agriculture playing a lead role. Joint planning and implementation of agreed work plans would be critical to success of efforts. In addition, the following are critical considerations:

i) Continuous research and development of new high yielding rice varieties should keep the sector going.

ii) Need to focus on the ultimate objective of making rice a major staple food. iii) Remain on guard to unscrupulous players along the value chain to avoid disenfranchising

the producer. __________________________________________________________________________

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Case Study 3: Cereal Growers Association The core activity of the CGA is coordination of field activities. The organization is engaged in:

i) Though not involve in any of the above, our organization is involved in mobilizing cereal farmers into fully functioning business structures and offer business support services that will grow their farming business and improve their livelihood.

ii) Provision of extension services, together with other partners facilitate technology transfer through on farm demonstrations and field days

iii) Postharvest handling facilitation services to minimize losses. iv) Input procurement facilitation services in accessing farm inputs to its members at

discounted costs for in order to benefit from economies of scale. v) Training and facilitation of farmers to undertake bulking and joint marketing of their

produce for better returns vi) Training and facilitation of farmers to access credit where necessary.

Currently CGA has a programme funded by AGRA on strengthening the capacity smallholders associations in the South Rift and some parts of Nyanza particularly Kisii. CGA considers its principal role in the rice value chain to be mobilization of farmers to form business groups to be benefit from the services the organization offers. It is the opinion of the CGA that investments in rice value chains can be mainstreamed into national budgets to benefit from allocations coming from the treasury by involving and sensitizing beneficiaries and stakeholders in formulating work plans and budgets. It is absolutely crucial for the government to set aside appropriate funding to develop the rice sector.

Institutional measures necessary for CGA to have the required capacity in terms of human and other resources to engage fully in rice development should include formation of stakeholders’ forums and well-organized and trained farmers’ groups.

The entire rice value chain requires measures and changes such as farmer training on the importance of using improved or quality seeds, application of fertilizer and processing techniques, water harvesting techniques, change in eating habits and market trends worldwide. These would improve rice production, processing, marketing and consumption. They would be implemented by the government, private sector and other development partners through organized meetings, trainings, workshops and the media. Over and above this, it is important that provision of improved seed, training in water harvesting techniques, investment in and efficient usage/application of fertilizers, transplanting techniques, exposure of farmers in form of trainings and tours, and changes in eating habits by Kenyans be ingrained in the population. ________________________________________________________________________

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Case Study 4: Lake Basin Development Authority The core activity of the authority is rice milling, adaptive research/variety trials, extension and outreach services. The LBDA is involved in rice development programmes, specifically:

• Development of NERICA varieties through a series of adaptability trials and selection in Western Kenya in the entire period that culminated in the release of NERICA1, NERICA 4, NERICA 10 and NERICA 11.

• In the early 1990s, the Authority through West Kenya Rain-fed Rice Development Programme and in collaboration with KARI and ICIPE developed other rain-fed rice varieties including DOURADO

Currently the LBDA through the Ministry of Regional Development Authorities is implementing Kimira Oluch Small-Holder Farm Irrigation Project funded by AfDB and which will involve opening up 1800 ha of land for development of crops including approximately 400 ha for rice. The Authority is also holding dialogue with the World Council of Credit Unions (WOCCU) to strengthen Rice Cooperative Societies through capacity building, establishment of office infrastructure and financing of rice development through disbursement of low interest loans. The LBDA considers that its principal role in the rice value chain in Kenya is rice processing and marketing. It strongly feels that for rice development to benefit from allocations coming from the treasury rice should be recognized as a staple crop in the country and therefore given the level of consideration accorded to maize including organised supply of farm inputs, stable pricing, development of storage infrastructure and strengthening of research and seed production. Further, resources can be mobilized from national and external sources for investments in rice value chains directly through the Rice Cooperative Societies or through state-owned rice mills. The LBDA plans to further modernize the rice mill, and increase rice production by expanding acreage under rain-fed conditions within the next five years. To increase rice production, the LBDA proposes that the institutional measures required particularly those needed for building of capacity in terms of human and other resources should be to engage more extension staff, purchase of more farm machinery (tractors and implements) so as to facilitate timely land preparation.

Other measures that are critical to increase efficiency in the rice value chain are:

• Seed production should be streamlined as a way of ensuring quality and high yields. Most farmers are recycling seeds and this can lead to poor yields and relatively high production costs.

• Investment in efficient mini-mills will reduce cost of transporting rice in the husk over long distances.

These measures can be implemented as follows:

• Seed development can be mandated to the registered seed producing companies and merchants under supervision of KEPHIS.

• Investment in mini-mills can be done by Rice Cooperative Societies upon capacity building by Ministry of Cooperatives and Marketing and Ministry of Agriculture among others.

• There may be need to constitute an umbrella authority (body) to spearhead rice development, regulation and control.

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B: Objectives set out in the National Water Master Plan for Rice Development Rice production accounts for 22% of the irrigated areas, while food and horticultural crops account for 25% and 53%, respectively. Horticulture based projects are more common in the Mt. Kenya region in Central and Eastern provinces and are also found in Coast province. Objectives The specific objectives set out in the National Water Master Plan for rice development are to:

1. Expand land under irrigation and drainage by 40,000 ha per year. 2. Increase agriculture productivity by enhancing crop yield, quality and net income and by

providing additional opportunities for enhancing livestock and fishery production. 3. Improve sustainability of agricultural production by reducing negative impacts. 4. Enhance equity by creating sustainable livelihood and employment opportunities in marginal

areas. 5. Enhance Kenya foreign exchange reserves through support to export horticultural production.

Targets The specific targets include:

1. Develop new irrigation and drainage command areas at the rate of 32,000 ha per year. 2. Rehabilitate existing irrigation and drainage areas at the rate of 8,000 ha per year. 3. Increase irrigation and drainage crop yields by at least 10% of the yield gap each year. 4. Contribute to crop and other enterprise diversification by expanding the range of horticultural

crops, integrating livestock and fisheries in 100 irrigation and drainage projects per year. 5. Improve service delivery of irrigation and drainage and related institutions. 6. Enhance gender equity in irrigation and drainage by increasing the number of women and

youth member of irrigation and drainage committee for at least 20 schemes a year. 7. Improve resource mobilization (a) by increasing budgetary allocation to irrigation and

drainage development by at least 1% of the national budget, and (b) by enhancing private-public partnership.

8. Enhance utilization of science and technology in irrigated and drainage agriculture by improving access to up-to date and relevant information and knowledge.

9. Ensure compliance of environmental and health requirements of at least 10 irrigation and drainage schemes per year.

10. Ensure that there is pro-active and enabling policies and legislative framework by reviewing impacts at least every 5 years.

Strategies The main strategies to achieve the above include:

1. Enhancing capacities to planning, design, construct, operate and maintain irrigation and drainage systems through the following strategic interventions.

2. Effective watershed management. 3. Effective and efficient capture, storage, conveyance and distribution of water resources. 4. Enhancing benefits associated with irrigation and drainage development through higher

yields, expanded areas and increase in cropping intensities. 5. More equitable sharing of irrigation water, irrigation or drainage command area and/or costs

and benefits associated with irrigation and drainage.

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C: Ahero Irrigation Scheme The scheme operations stalled in the 1999/2000 cropping season due to depletion of the revolving funds following the Mwea crisis. The Ministry of Agriculture/ FAO revived the scheme using the Rapid Results Initiative (RRI) following the donation of two new water pumps at a cost of Kshs 20 Million. The commissioning of the rehabilitated Ahero Irrigation Scheme was held on the 14th July 2005 presided by the then Minister for Water and Irrigation; Hon. Martha Karua. Ministry of Water and Irrigation funded the installation of two additional flood lift pumps at a cost of Kshs 25 million. To adapt to the Government Policy on liberalization, National Irrigation Board underwent restructuring in the year 2002 and is now in the process of stabilization. The scheme became operational in July 2005 under the management of National Irrigation Board. For sustainable, reliable, and cost effective provision of irrigation and drainage services in the scheme, National Irrigation Board has engaged CODA Consultants services to explore the possibility of Gravity flow diversion and conveyance facilities. Through sustainable exploitation of available irrigation potential, National Irrigation Board has embarked on an expansion programme with a target of 500 acres in the financial year 2006/7 (Kasiru-Kolal-Mbega sections). The scheme has benefited as a result of the Government policy to support irrigation development as stipulated in the 9th National Development Plan for 2002 – 2008 and the Poverty Reduction Strategy Paper for 2001 – 2004 through provision of development funds for procurement of new pumps, heavy machinery and expansion. Scheme objectives

1. Optimal utilization of available land and water resources 2. Attainment of food self sufficiency and security 3. Improvement of income generation 4. Creation of wealth and employment 5. Promotion of participatory irrigation management for sustainable production and growth 6. Sustainable supply of raw materials for Agro-based industries

Tasks Accomplished

• Installation of two new inclined tsunami water pumps and two vertical flood lift pumps. • 50% Rehabilitation of water conveyance and control structures • Successful divesture of NIB from land preparation services, credit and input provision to the

farmer and marketing. • Formation and training of Water User Associations on participatory irrigation management • Formation of Farmers Cooperative society.

Challenges facing the Scheme

1. Financial o Inadequate funding for Irrigation & Drainage development o Lack of cost-effective Water Supply System(pumping vs gravity)

2. Operational o Flood damages/effects. o River Nyando bank erosion, o Fluctuation of River flow(R.Nyando), o Lack of water storage to guarantee adequate supply during the dry spell,

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o Poor road network, o Inadequate partnership in irrigation. o Little or no participation by other relevant stakeholders e.g. Ministry of Agriculture,

Health, Cooperative etc. 3. Farmers Institutions (WUA and Cooperative)

o Inadequate capacity building o Weak farmers’ organizations. (lack of funds) o Slow adoption of Participatory Irrigation Management by the farming community. o Rice diseases and pests control. o Unstable market for rice products.

4. Health and Environment o Combating of water-borne and other related diseases, o Ensuring environmental stability, o Lack of clean drinking water.

Proposed Interventions (Way Forward) The following are the possible proposed solutions to above challenges: Proposed Interventions (Way Forward) The following are the possible proposed solutions to above challenges: Finance Increased Government allocation of development funds NIB to;

• Facilitate provision of cost effective water supply system (gravity).

• Improve efficiency of existing scheme. • Expand existing scheme. • Facilitate construction of a dam upstream. • Train river Nyando (mainly two critical sites).

Operational

• Institutional capacity development (farmers), • Capacity building of irrigation farmers on project ownership for sustainable operation ,

maintenance and management, • Enhanced networking among sector stakeholders, • Enhanced marketing with emphasis on value addition on irrigated produce.

Formulation /implementation of a national irrigation policy, legal & institutional frameworks

The Ahero pumps

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D: JICA-funded Mwea Irrigation Development Project

August 16, 2010

Signing of Japanese ODA Loan with the Republic of Kenya – Contribution to food security in Kenya through the development of rice and horticultural crops –

1. On August 16th, the Japan International Cooperation Agency (JICA) signed a Japanese ODA loan agreement with the Government of the Republic of Kenya in Nairobi to finance up to 13.178 billion yen for the Mwea Irrigation Development Project.

2. The Mwea division in central Kenya (about 100km northeast of the capital, Nairobi) [1] produces over 50% of the national production of rice. The JICA-supported project will strengthen capacity in the area to operate, maintain, and manage core irrigation infrastructure. It will also improve irrigation facilities to provide a stable supply of the water required by agriculture in the area. The project is expected to enable double-cropping (two harvests per year) of rice and horticultural crops, as well as to improve the productivity of rice and other crops by expanding the total cultivated area from 7,860 ha to 16,920 ha in the project area. Through these efforts, the project aims to contribute to the improvement of food security in Kenya and to the livelihoods of farmers in the region.

3. As most agriculture in Kenya depends upon rainfall, crop production is easily influenced by weather. The country is frequently beset by droughts and food shortages, making the development of irrigation to stabilise food production a key issue from the standpoint of food security. Development of the Mwea irrigation area is positioned as a national flagship project within the Vision 2030 long-term national development plan formulated by the Kenyan government in 2008.

4. The Yokohama Action Plan put forth at the 4th Tokyo International Conference on African Development (TICAD IV) advocated improving Africa's capacity to increase its food production and to improve agricultural productivity. Based on that call to action, JICA is promoting the Coalition for African Rice Development (CARD), an initiative to double rice production in Africa within 10 years. Within the CARD initiative, the Kenyan government has set a goal of boosting domestic rice production from 73,000 tons in 2008 to 178,000 tons within 10 years of then. JICA will continue to support initiatives, including the announced project, to increase rice production in Africa.

Planned Actions

• Construction of an agricultural dam • Upgrade of link Canal I • Upgrade of Link Canal II • Construction of Link Canal III • Expansion of irrigation area

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1. Terms and Amounts of Loan

Project title Amount (million yen)

Annual interest rate (%) Repayment

Period (years)

Deferment period (years)

Procurement

ProjectConsulting services

Mwea Irrigation Development Project

13,178 1.20 0.01 30 10 General untied

2. Executing Agency

National Irrigation Board Address: Unyunyuzi House, Lenana Road, Nairobi, Kenya, P.O. Box 30372, 00100 Phone: +254 20 2711380, Fax: +254 20 2722821

3. Planned Implementation Schedule

i) Completion of project: November 2016 (when the facilities are put into service)

ii) Issuing of letters of invitation for consulting services (including detailed design work): July 2010 (already sent)

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iii) Tender announcement of initial procurement package for international competitive bidding on project construction:

Procurement package title: Civil Works 1 (Agricultural Dam Construction), Civil Work 2 (Irrigation and Drainage Facilities Construction) Release date: November 2011