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PUBLISHED ON January 21st, 2015

Fresh produce exporters now demand sh1bn

Exporters of fresh produce to the European Union are demanding Sh1 billion in compensation from the union after Kenya was reinstated to preferential market access to Europe.

The amount is a result of losses dealers are said to have lost through taxes imposed on fresh produce destined for the EU over a period of three months.

According to the Kenya Flower Council, the horticulture sector has lost close to Sh1 billion after the union imposed the taxes beginning October last year.

FAILED TO BEAT DEADLINE

“We are talking about Sh1 billion in total, including taxes on vegetables and fruits for the three months to December,” Kenya Flower Council chief executive Jane Ngige told Nation in an interview.

The taxes were imposed after Kenya, alongside other East African Community member states, failed to beat the deadline in signing an Economic Partnership Agreement (EPA) with the EU that would cushion exporters from the charges.

The country was, however, reinstated to the quota-free and duty-free export regime on October 6 with the same being implemented on December 24.

The EU formally returned Kenya to this status after the European Parliament and the European Council accepted a petition by the country to remove it from Generalised System of Preferences where taxes apply to the duty-free Market Access regulation.

“We have been in touch with both the Foreign Affairs ministry and Treasury over the issue as a result of intense pressure from our members who suffered losses,” said Mrs Ngige.

Agriculture Cabinet Secretary Felix Koskei last week said Kenya had initiated talks with the European Union seeking ways of compensating the fresh produce exporters.

The traders had been subjected to import duties of between 5 per cent and 30 per cent on fresh produce including cut flowers, fruits and vegetables.

Kenya exports flowers worth Sh46.3 billion and vegetables worth more than Sh26.5 billion to the EU every year. The EU is the largest single market in the world.

Source: Daily Nation

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