This archive report was first published on 10 June 2020.
President Uhuru Kenyatta's government has announced a Sh3 billion stimulus package for small-scale farmers, aimed at cushioning them against the economic contraction caused by the Covid-19 pandemic, desert locust invasions, and bad weather.
Published on June 10, 2020, the package will be distributed through an e-voucher system, which subsidises inputs such as fertiliser, seeds, chemicals, post-harvest tools, and soil testing services.
The vouchers, worth Sh20,000 per acre, will be given to about 200,000 farmers, with a focus on vulnerable farmers who have five acres or less.
The e-voucher system is a subsidy system that allows farmers to purchase inputs from multiple providers, with the government covering 40% of the cost and the farmer covering the remaining 60%.
According to Agriculture Principal Secretary Hamadi Boga, the programme will be implemented in partnership with Kenya Commercial Bank and Safaricom through mobile telephony, with farmers receiving e-vouchers that can only be redeemed at agro-vet outlets pre-qualified by the Ministry of Agriculture.
Chief economist at Mentoria Economics, Ken Gichinga, praised the programme, saying it keeps the beneficiaries honest by requiring them to participate in the farming ecosystem and purchase inputs.
However, Gichinga noted that the challenge lies in the fact that many small-scale farmers do not have access to credit, with only about three to four percent of bank loans going to agriculture, despite the industry contributing about 25% of Kenya's gross domestic product.
