BY PETER WANYAMA, LEGAL COMPLIANCE SPECIALIST
Introduction
Smallholder producers who actually form the majority of farmers in Kenya have limited access to own or borrowed capital. Commercial banks regard them as risky borrowers and more often than not tend to shy aware from giving them loans–and to some extent for a good reason, namely; the relatively high risk of rain fed agriculture not just for smallholders but also medium to large farmers.
While this is the prevailing situation, Government funding has not been commensurate with the sector’s importance in overall national economic development. Indeed, sector ministries and other stakeholders have raised the issue of under-financing of the sector over and over again. But despite all this, the share of the national budget to the sector has remained unjustifiably too low. Yet, little has been done albeit the fact that various formal government pronouncements have acknowledged this undisputable fact. It is for this reason that counties are strongly encouraged to adopt strategic measures to improve the financing of agriculture. This section outlines the proposed strategies.
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