Trade policy impacts on Kenyan agriculture: challenges and missed opportunities in the sugar industry

Andrew M. Karanja

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Trade policy impacts on Kenyan agriculture: challenges and missed opportunities in the sugar industry

in Development economics between markets and institutions

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Andrew M. Karanja

Andrew M. Karanja
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Art:: Kapitel

Seiten:: 243–260

DOI:: https://doi.org/10.3920/9789086866182_015

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Agricultural trade policies are increasingly becoming critical in economic, social and political arenas of most developing countries such as Kenya. The pressures from globalisation and regional integration have intensely and continuously confronted policy makers in Kenya with the ‘classical food price policy dilemma’ on how best to deal with producer incentives without hurting the welfare of consumers. This chapter evaluates the agricultural trade policy, and its price and welfare impacts on producers and consumers. This is undertaken by estimating both the Nominal and the Effective Rate of Protection (NRP and ERP, respectively) using sugar as a case study. Results indicate that in the early 1990s the tariff structure in Kenya was more focussed on promoting competition even in the agricultural sector with certain reversals occurring in the late 1990s aimed mainly at protecting local producers. The case study demonstrates that despite the high protection accorded to the Kenyan sugar producers they are under intense competitive pressure from regional and international markets, which they are unlikely to withstand due to various constraints. The current agricultural trade policy is also not in tandem with the emerging international and regional trade regimes, and is mainly driven by the desire to safeguard the interests of farmers without due consideration on the nationwide impacts on consumers and the poor. In most cases the policies have turned to be counter-productive, as they have impacted negatively on would be beneficiaries and the poverty reduction goal.

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Development economics between markets and institutions

Incentives for growth, food security and sustainable use of the environment

Reihe: Mansholt Publication series, Band: 4

Cover Development economics between markets and institutions

ISBN:: 9789086866182

Verleger:: Wageningen Academic

Print-Publikationsdatum:: 30 Oct 2007

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Trade policy impacts on Kenyan agriculture: challenges and missed opportunities in the sugar industry

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Development economics between markets and institutions

Incentives for growth, food security and sustainable use of the environment

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