Reform edible oils sector to create jobs

Highly viable quick win opportunities exist to alleviate the urgent pressures associated with mass unemployment among the youth and mitigate the havoc wrought by the Covid-19 pandemic.

Jobs for the youth will go a long way in shifting the conversation from gloom to soaring hope once the youth hear, and see and understand the proposals of the various political formations on turning their plight around.

The economy is dripping with low-hanging fruits with realistic potential to yield anything between two and three million jobs in less than 24 months and generate revenues for ordinary families.

The country imported Sh78 billion worth of crude edible vegetable oils in 2017 and Sh59 billion in 2018, according to the Kenya National Bureau of Statistics, mainly from Indonesia, Ukraine and Malaysia. The Russian-Ukrainian war has also induced the cooking oil shortage due to disruption of sunflower growing in Ukraine.

Vegetable oils are processed from crops that have proven to have good performance in Kenya—sunflower, cashew nut, ground nut and palm oil. These crops are easy to grow across our various climatic zones. This sector is a goldmine for immediate job creation. For the commercial comfort of a few, however, it is patronised by cartels of edible oil importers who pass themselves off as “manufacturers”, at the expense of farmers and jobless youth.

Illegal exemptions

The cartels secure illegal exemptions against the official government policy of total enforcement of Common External Tariffs for all products that do not meet 25 per cent local intermediate manufacturing inputs. All official East African Community and World Bank reports on trade have repeatedly questioned these exemptions that hinder the growth of local manufacturing and contribute to destabilisation of the bloc’s enforcement of CETs.

The new administration that will come in after the August elections should introduce immediate reforms, removing this unjustifiable export of Kenyan jobs in line with Vision 2030 and the Big Four Agenda pillar of manufacturing, value addition and job creation. This would yield anything between 1.5 and two million jobs in under 18 months. These jobs are in smallholder farming, transport, warehousing, processing and distribution functions of the entire value chain.

Oil import ban

The vegetable oil import ban will immediately give importers and cartels an incentive to contract local small- and large-scale farmers to grow the crops for them. With agriculture a devolved function, the national government should partner with the counties to supply farm inputs like seeds and fertiliser and extension services to catalyse the transition.

Experts have intimated that some three million acres put under these crops to generate 600,000 tonnes of sunflower could yield up to two million jobs. Kenyan youth are a highly informed and vibrant constituency that should be approached with an equally robust engagement. There is no justification why this cannot be done immediately.

Mr Kwinga is a political scientist. skwinga@ gmail.com.