Coffee is suffering because whims and interests of ruling elite have changed

By: JAINDI KISERO

The coffee industry in Kenya is a story of benign State neglect. It is one of the biggest scandals of our time. And why has government policy neglected the revival of the coffee industry? You must go beyond popular myths and wisdoms to understand the dynamics.

The plight of the coffee farmer is a study in the political economy of agricultural policy — how economic policy shifts depending on the whims and interests of the elite. Throughout the regime of former President Daniel arap Moi, the accent of agricultural policy was placed on food self-sufficiency, mainly because the Rift Valley elite were maize and wheat farmers.

Today, policy is biased against coffee because the contemporary Kikuyu elite no longer has a stake or interest in the crop. During the regime of former president Jomo Kenyatta, economic policy accorded coffee high priority because the governing elite was also a land-owning one bound to rural Central Province by a powerful economic interest: ownership of coffee estates.

Today, the contemporary Mount Kenya elite has shifted its interests elsewhere — to banking and insurance, the stock exchange, investment banking, and property development.

Here are some examples to support my theory. Mr John Michuki cleared his coffee estate many years ago to develop prestigious golf course. Mr Zachariah Gakunju sub-divided and sold his massive coffee farms on Kiambu road to pave the way for what is now Runda Estate. Mr Stanley Githunguri sold his massive Kiambu Coffee Estate to give way for property development.

Former Attorney-General James Karugu has also reportedly cleared a chunk of his massive Kiambu farm to make way for a major property development project. A former head of the civil service, Mr Jeremiah Kiereini, recently confessed that he was only in coffee farming for sentimental reasons. Today, the rage in central Kenya is Tatu City, Two Rivers, and Thika Greens.

SHIFTED INTERESTS

What is my point? It is that contemporary agricultural policy has neglected coffee because the big boys shifted their interests, leaving the crop to the rural-based poor farmer who has little capacity to influence government policy.

My second theory as to why the industry is in dire straits is the gradual collapse of the institutions and pillars that nurtured and supported the industry — coffee societies, powerful district-wide coffee unions, the Coffee Research Foundation, and so on. Nearly all the key institutions in this sector are today a shadow of their former selves.

When, as a young business writer, I started reporting coffee issues in the late 1980s, the Kenya Planters Cooperative Union had a balance sheet larger than most of the blue chip companies you see listed on the Nairobi Securities Exchange today. And the large coffee cooperatives were rich and powerful institutions, paying dividends and bonuses to farmers year in, year out.

Although State-controlled, the defunct Coffee Board of Kenya operated democratically, with its directors elected at an annual conference in which all coffee farming districts were represented.

The Coffee Research Foundation was a well-funded entity conducting rigorous cutting-edge research on modern agronomical practices and passing its findings to farmers. Ruiru 11, the pest-resistant seed variety, was developed locally by our own researchers at this key institution.

LESS EXPORTS

Where did the rain start beating us? Clearly, part of the problem was uncritical implementation of liberalisation policies. We applied liberalisation as if it was dogma and dismantled institutions and pillars upon which the coffee industry rested without replacing them with new and more efficient ones.

All institutions and pillars that propped up and supported the industry metastasised into parasites, eating away the margins from the farmer. In 1988, we exported 130,000 tonnes of coffee. Today, we export less than 50,000 tonnes. Massive investment is needed to rehabilitate the institutions.

Which brings me to my third theory. National economic policy-making has been biased against coffee because of the erosion of the influence of lobby groups for farmers.

Long before the advent of multi-partyism, the coffee farming fraternity stood out as an organised and vocal group. I still remember the exploits of the Kenya Coffee Growers Association and how farmers would rise up against State policy.

SOURCE: DAILY NATION