The window for Kenyan flower farmers and exporters to sell fresh cut flowers in the UK market duty free opens today.
The eight per cent fee suspension is set to see local farmers earn more from the trade, in turn boosting the sector earnings which dropped last year.
Running till June 2026 with a review on possible extension before this date, the initiative further seeks to make trade between flower growing countries and the UK easier and cheaper.
Although it applies globally, the UK says the move will be a big win for major flower growing regions in Kenya, Ethiopia, Rwanda, Tanzania and Uganda.
Unlimited quantities of flowers will be exported to the UK at zero per cent tariff, even if they transit via a third country.
"This is particularly important for East African flower growers who transport their blooms via third-countries or auction houses before they arrive in the UK," the UK government said in a statement.
Kenya's earnings from cut flowers dropped to a five-year low in 2023.
A report by the Fresh Produce Consortium of Kenya (FPCK) shows the country exported 116,000 tonnes of cut flowers worth Sh73 billion in 2023 compared to 203,000 tonnes worth Sh104 billion in 2022.
This was the least cut flower export volume the country recorded since 2017 when it shipped 160,000 tonnes worth Sh82 billion to the international market.
However, with the duty suspension kicking in, players are optimistic that the earnings will pick up in the medium to long term.
Agriculture Sector Network (ASNET) in a statement noted that the relief will help Kenyan growers and exporters to even create new jobs, prompting growth in the sector.
UK's trade commissioner for Africa John Humphrey, said the directive to suspend the duty fee is an additional flower power, a move that will allow trade to bloom.
“The UK’s relationship with East Africa is rooted in mutually beneficial trade. We go far when we go together, or in this case, we grow far when we grow together," Humphrey said.
He further reinforced UK’s commitment to expanding trade in East Africa.
In 2022, Kenya was ranked as the fourth biggest exporter of cut flowers in the world, with six per cent of global cut-flower exports.
Ethiopia is the second largest cut flower producer in Africa, making up 23 per cent of Sub-Saharan African exports.
Kenya signed an economic partnership agreement with the UK on August 8, 2020 in London.
The agreement was then ratified in March 2021.
It sought to ensure all companies operating in Kenya, including British businesses benefit from duty-free access to the UK market.
This was to save exporters over £10 million (Sh1.65 billion) every year in duties on products such as green beans and cut flowers.
Generally, the agreement commits the UK to support Kenya with agreement implementation, enhance competitiveness, and build trade capabilities and ability to attract investment, as well as further integrate itself into global supply chains.
Kenya through the agreement was also to gradually reduce duties on UK products they have deemed non-sensitive, providing Kenyan businesses with cheaper inputs, which could support agricultural development and manufacturing.
Data by Kenya-UK factsheet on trade and investment shows total trade in goods and services between the two sates stands at £1.4 billion (Sh236.7 billion) in the four quarters to the end of Q3 2023.
This is an increase of 11.1 per cent or £140 million (Sh23.7 billion) in current prices from the four quarters to the end of Q3 2022.
Of this, the total UK exports to Kenya amounted to £635 million in the four quarters to the end of Q3 2023 (an increase of 6.5% or £39 million in current prices, compared to the four quarters to the end of Q3 2022).
On the other hand, total UK imports from Kenya amounted to £771 million in the same period (an increase of 15.1 per cent or £101 million in current prices.
Kenya was UK’s 81st largest trading partner in the four quarters to the end of Q3 2023, accounting for 0.1 per cent of total UK trade.
