MPs now seek G-to-G deal for fertiliser

 

MPs are seeking to have the government-to-government (G-to-G) procurement model, which is currently being used to buy fuel on credit, adopted in the purchase of fertiliser.

Mbeere North MP Geoffrey Ruku has moved a motion seeking to introduce the model that would see Kenya buy subsidised fertiliser from countries that have a surplus of the critical farming input.

The motion is awaiting debate in the National Assembly.

“This House, therefore, resolves that the government, through the Ministry of Agriculture and Livestock Development and its agencies adopts the government-to-government model in the acquisition and supply of fertilisers by identifying potential partner countries that have surplus and quality fertilisers,” says the motion.

The MP said that the cost, quantity and quality of fertilisers and subsequently the cost of production of food crops and cash crops, including coffee, tea and miraa, had increased partly due to a big markup put by private suppliers.

This, Mr Ruku said, poses a threat to the country’s food security at a time when agriculture contributes about a quarter of Kenya’s GDP.

Under the G-to-G arrangement, the government would buy and distribute subsidised fertiliser through the Kenya Farmers Association, Kenya Tea Development Agency, Coffee Board of Kenya, and Kenya Planters Cooperative Union, among other agencies. The MP argued that the G-to-G model “has been noted to lower cost of products” and that “there are countries willing to enter into a G2G agreement” for the supply of fertiliser to Kenya.

“G2G has been proven to be effective in the provision of services that have a direct impact on citizens’ livelihoods, including the cost of living such as the supply of fertilizers, particularly in countries with similar agricultural conditions as Kenya,” he said in the motion.

An audit report by Auditor-General Nancy Gathungu, however, poked holes into the model, revealing that it had instead led to an increase in the cost of a litre of fuel, which crossed the Sh200 mark for the first time last year. The government has announced that it will end the G-to-G deal for oil in December this year after it was found to have also distorted the currency markets.

If the motion is passed and enacted, fertilizer would become the second commodity to be purchased through such a system after fuel.

It is unclear what countries Kenya would target for a G-to-G fertilizer deal. But Kenya imports most of its fertilizer from the Kingdom of Jordan, according to data from the World Bank.

It shows the country imported 5,500 tonnes of fertilizer from Jordan in 2019 followed by Germany which shipped 2,223 tonnes of the commodity to Kenya during that year.

Russia is the third largest seller of the product to Kenya, exporting 1,008 tonnes of fertilizer to Kenya in 2019 while Switzerland and Lithuania close the top five with 550 tonnes and 486 tonnes respectively.

Fertilizer has been a major headache for farmers in recent years as prices have continued to rise, sharply raising the cost of farming.

This has forced the government to step in with a subsidy which has allowed farmers to buy the product at subsidized prices.

President William Ruto has prioritized the fertilizer subsidy programme, and last year cut fertilizer prices per 50-kilogramme bag to Sh2,500 from Sh6,500.

The programme has however not been without controversy amid accusations that well-connected individuals are being allocated the subsidized fertilizer at the expense of farmers.

Soy MP David Kiplagat last week further raised concern over the long queues and delays experienced by farmers seeking to get the low-cost fertilizer.

“The Ministry of Agriculture should provide details on the amount of subsidized fertilizer available in National Cereals and Produce Board (NCPB) depots across the country,” he said.

By BRIAN AMBANI