Agriculture

A brief overview of the agricultural sector in Kenya

Agriculture has, for many years, formed the backbone of Kenya's economy: the agriculture sector contributes about 30 per cent of the Gross Domestic Product (GDP) and accounts for 80 per cent of national employment, mainly in the rural areas. In addition, the sector contributes more than 60 per cent of the total export earnings and about 45 per cent of government revenue, while providing for most of the country's food requirements. The sector is estimated to have a further indirect contribution of nearly 27 per cent of GDP through linkages with manufacturing, distribution, and other service related sectors.

Kenya's agricultural sector directly influences overall economic performance through its contribution to GDP. Periods of high economic growth rates have been synonymous with increased agricultural growth.

The tea sector is a dominant sector and the coffee sector has started to pick up following a decline in the recent past. The horticultural and flora sectors have seen unprecedented growth over the past years as more companies venture into production and export of flowers and fresh produce.

The sugar industry has faced significant challenges and it is the government’s intention to improve the sector. This industry is expected to show good growth over the next few years, should the government implement their stated policies.

Other sectors where the country has significant untapped resources include cotton, forestry, fishing, pyrethrum, and macadamia nuts.

PricewaterhouseCoopers provides services to the main agricultural companies producing tea, coffee, flowers, horticulture and sugar in Kenya. With the introduction of International Accounting Standard 41 – Agriculture, PricewaterhouseCoopers played an active role in bringing together key players in the sector to address and overcome the challenges of implementing the standard.