State to set up Sh20b fund for input subsidy
The government and donor community will establish an Sh19.5 billion fund to enhance input subsidy and cushion tea farmers against adverse price shocks. Agriculture Cabinet Secretary Peter Munya said the fund to be operationalised and implemented by the Tea Board of Kenya (TBK) in the 2022/23 financial year is part of key interventions being fast-tracked to ensure stability in the multibillion tea industry.
The establishment of the fund is part of key findings highlighted by the Irungu Nyakera led price stabilisation committee established by the minister in April 2021.
“The Committee has proposed establishment of a tea fund in line with the provisions of the Tea Act 2021 whose objectives and purpose are to mobilize resources towards efficient and effective price stabilization for the tea sector,” said Munya.
He added: “The fund shall be administered per the Tea Price Stabilization Fund Regulations, 2021.” The new fund, Munya added will support the construction of warehousing facilities at the factory level, promote value addition either at the factory level or through the common user facility, and invest any surplus funds for its sustainability. Speaking during the launch of the report on the tea industry price stabilisation framework at a Nairobi hotel yesterday, the CS, explained that upon operationalisation of the fund, there will be a need for a two-year moratorium period to allow the kitty to grow before a drawdown is made.