Magazine article African Business

Can East Europe Pick Up Export Slack? Kenya Is Looking to Eastern Europe as an Expansion Strategy for Its Horticulture Export Market, Following a Fall in Demand from Its Traditional Markets in Western Europe. Solomon Mburu Reports

Magazine article African Business

Can East Europe Pick Up Export Slack? Kenya Is Looking to Eastern Europe as an Expansion Strategy for Its Horticulture Export Market, Following a Fall in Demand from Its Traditional Markets in Western Europe. Solomon Mburu Reports

Article excerpt

Horticulture exports, which earn the East African country $1bn annually, have mainly focused on Western European markets with the UK and Germany accounting for the largest share. But due to a recent downturn, Kenyan exporters are now looking to diversify their markets into Eastern Europe in order to increase earnings and spread their risks. The market disruption was initially caused by the controversial carbon-footprints concept that sought to block Kenyan horticulture exports going to Western European countries due to their supposed contribution to global greenhouse-gas emissions during their airfreight.

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The global economic crisis sliced off a huge chunk of Kenya's export quota to major Western European countries. According to the Fresh Produce Exporters Association of Kenya's chief executive, Stephen Mbithi, this proved the prudence of diversifying the market rather than "keeping all the eggs in one basket". Kenya's main horticultural exports include cut flowers, such as roses and carnations, and processed and fresh vegetables.

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Diversifying the market is expected to help cushion the country from such future market changes. The exporters are targeting Russia as the entry point into Eastern European countries such as Hungary, Turkey, Poland and the Czech Republic. These countries, being in the northern hemisphere, experience cold winters and traditionally import fruits and vegetables during the winter months, and so are a potentially valuable market for Kenyan producers.

Kenya's major horticulture export, cut flowers, already reaches Eastern Europe through the Holland flower auction floors which attract buyers from all over Europe, but Kenyan exporters are looking for direct links to new markets to increase earnings and volumes.

Campaign in full swing

The new Eastern Europe market is projected to earn Kenya an extra $250m annually over the next five years. The market is, however, expected to be much smaller than that of Western Europe because consumers are less affluent and have less disposable income for commodities, such as cut flowers, that are still viewed as luxuries. …

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