Increasing the Profit Potential for Farmers in Kenya

Introduction

Agriculture is key to Kenya’s economy, contributing 26% of GDP directly and another 27% indirectly through linkages with other sectors. The agricultural sector employs more than 40% of the total population—around 70% in rural areas—and accounts for 65% of the country’s export earnings. It is not only central to people’s livelihood and food security but also the main driver of the rest of the economy, providing inputs and markets in manufacturing, construction, transportation, tourism, education and other non-agricultural areas.

Despite the progress Kenya has made over the last decade in reducing poverty, a good proportion of the population still lives below the poverty line. Evidence indicates that in Kenya, agricultural-led growth is more than twice as effective as industry-led growth at reducing poverty. The key to better performance in agriculture is to rapidly increase smallholder productivity. Growing evidence also suggests the importance of rural non-farm activities in the ability of households in rural areas to generate income.

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