Kenya’s Agriculture On The Rise, Reforms Set To Boost Competitiveness

From VAT Reforms To Technology Adoption, Kenya Takes Bold Steps To Grow Agriculture

Kenya’s agricultural sector is taking a bold step toward becoming more competitive, sustainable, and innovative. On 18th November 2025, the Ministry of Agriculture and Livestock Development hosted a high-level stakeholder forum in Nairobi, bringing together farmers, manufacturers, private sector associations, the National Treasury, Council of Governors, KRA, and key regulators.

The forum, led by Cabinet Secretary Sen. Mutahi Kagwe, gave stakeholders a platform to present a value chain-based memorandum highlighting critical challenges affecting agriculture—from taxes and trade barriers to regulatory levies and access to extension services.

Top Challenges Highlighted

VAT Harmonization & Refunds: Stakeholders called for a predictable VAT regime and clearance of over KShs. 150 billion in pending refunds to prevent company closures.
High Duties on Packaging Materials: Excise duties up to 60% are inflating costs for local manufacturers and exporters, threatening competitiveness.
Trade Barriers: Kenyan exports face higher tariffs abroad compared to neighboring countries, pushing for stronger bilateral trade agreements.
Land Rates & Cess Charges: Farmers expressed concerns over land rates and cross-county cess levies that increase production costs.
Regulatory Levies & Services: Overlapping levies from regulators are pushing up costs, while stakeholders demand better value for services.
Extension & Surveillance Services: More robust support is needed in pest control, seed certification, and preventing illegal trade in raw materials.

Government Promises Action

National Treasury PS Dr. Chris Kiptoo assured that the issues raised will guide upcoming budget reforms, including a review of taxes and levies. He hinted at a potential one-off VAT refund clearance to help industries avoid closures.

Council of Governors Chairman H.E. Ahmed Abdullahi pledged county-level support for extension services and confirmed that cross-county cess collection is illegal. CS Sen. Mutahi Kagwe encouraged adoption of technology, including AI, to boost production per acre and urged stakeholders to uphold ethical practices for better export competitiveness.

A United Sector

The memorandum reflected a broad collaboration, presented by leading sector players including ASNET, FA-K, KENADA, CGA, KFC, KTGA, MacNut, ASOK, KDPA, KEPOFA, LASK, VASIK, and KVA.

With government commitment and active private sector participation, Kenya’s agriculture is poised for growth, innovation, and stronger competitiveness—benefiting smallholder farmers, large-scale producers, and the nation’s economy.