Horticulture in Tanzania

HORTICULTUREFOCUS: A CRITICAL IBS FOR HORTICULTURE IN

TANZANIA

By Isaac Luseko

WHAT IS HORTICULTURE AND WHY IS IT IMPORTANT?

• HORTICULTURE IS A BRANCH OF AGRICULTURE

• DEALS WITH THE ART, SCIENCE, TECHNOLOGY AND BUSINESS OF PLANT CULTIVATION

• TREMENDOUS OPPORTUNITIES IN THE HORTICULTURE BUSINESS BUT THE WINDOW OF OPPORTUNITY IS CLOSING

• FOREIGN INCOME HAS INCREASED FROM USD 1.4 MILLION IN 2002 TO USD 140 MILLION IN 2008 AND IS NOW AROUND USD 380 MILLION PER ANNUM

• WORLD TRADE IN HORTICULTURE NOW ACCOUNTS FOR MORE THAN 20% OF TOTAL AGRICULTURAL EXPORTS

THE HORTICULTURE CROPS BEING GROWN IN TANZANIA ARE:

• ASIAN VEGETABLES

• BABY CORN

• BABY MARROW

• BEETROOTS

• BEANS

• CABBAGE

• EGGPLANTS

• SPINACH

• TOMATOES ETC.

HORTICULTURE CROPS ARE GROWN IN:

• MOSTLY IN HIGHLAND REGIONS SUCH AS:• MBEYA

• IRINGA

• NJOMBE

• ARUSHA

• KILIMANJARO

• TANGA

• MOROGORO

HORTICULTURE ADVANTAGES IN TANZANIA

• FAVORABLE CLIMATE CONDITIONS

• VAST PIECES OF ARABLE LAND SUITABLE FOR HORTICULTURE PRODUCTION

• FERTILE SOIL

• LOCATION OF DIFFERENT ALTITUDES WHICH CAN SUIT THE NEEDS OF DIFFERENT VARIETIES OF FLOWERS, VEGETABLES, FRUITS AND SPICES

• PROXIMITY TO MAIN ROADS, INTERNATIONAL AIRPORTS (KIA, JNIA, JKIA), AND SEAPORTS

IN COMPARISON (ETHIOPIA)

•ETHIOPIA – THEIR COMPETITIVE ADVANTAGE IS IN GROWING FLOWERS DUE TO FAVORABLE WEATHER CONDITIONS AND EXPORT TO THE EUROPEAN UNION, MIDDLE EAST AND REGIONAL MARKETS IN EAST AFRICA

IN COMPARISON (RWANDA)

•RWANDA – COMPETITIVE ADVANTAGE IN GROWING FRUITS AND VEGETABLES DUE TO ITS CLIMATE AND TOPOGRAPHY. THEY SPECIALIZE IN BEANS, PEAS, MUSHROOMS, CITRUS AND STRAWBERRIES BUT NOW ARE LOOKING INTO FLOWERS.

IN COMPARISON (KENYA)

• COMPETITIVE ADVANTAGE IN GROWING FLOWERS AS WELL AS FRESH FRUITS AND VEGETABLES.

• KENYA MAINLY EXPORTS CUT FLOWERS. HORTICULTURE CONTRIBUTES 33% TO THEIR AGRICULTURAL GDP.

• DUE TO THEIR SUPERIOR AIR TRANSPORT FACILITIES, KENYA’S VISION IS TO STRATEGICALLY BECOME TO THE TRADE HUB FOR EAST AND CENTRAL AFRICA.

• THE HORTICULTURAL INDUSTRY IN 2009 EARNED KENYA, KES 71.6 BILLION (USD 742 MILLION) AND AN ESTIMATED KES 153 BILLION (USD 1.58 BILLION) FROM THE DOMESTIC MARKET (NATIONAL HORTICULTURE POLICY, 2010).

TRADE STATISTICS FOR TANZANIA (UNCOMTRADE 2012)

TOP 10 EXPORT PARTNERS (UNCOMTRADE 2012)

TOP 10 IMPORT PARTNERS (UNCOMTRADE 2012)

TOP 10 EXPORT GOODS (UNCOMTRADE 2012)

EUROPEAN UNION TRADE TANZANIA

Top 20 Producers of Vegetables

2000   2007

Rank Country   Rank Country

1 China   1 China

2 India   2 India

3 Vietnam   3 Vietnam

4 Philippines   4 Nigeria

5 Nigeria   5 Philippines

6 Korea   6 Korea

7 France   7 Myanmar

8 Japan   8 Japan

9 Myanmar   9 Russia

10 Korea   10 Brazil

11 Brazil   11 Nepal

12 Italy   12 Korea

13 Iran   13 Iran

14 Nepal   14 Italy

15 Germany   15 Bangladesh

16 Russia   16 Pakistan

17 Pakistan   17 Thailand

18 USA   18 Tanzania

19 Thailand   19 USA 20 Tanzania   20 Cuba

Top 20 Exporters of Vegetables

2000   2007

Rank Country   Rank Country

1 USA   1 Mexico

2 Italy   2 Netherlands

3 China   3 Italy

4 France   4 USA

5 Netherlands   5 France

6 Kenya   6 Kenya

7 Spain   7 Spain

8 Israel   8 China

9 Thailand   9 Israel

10 Belgium   10 Thailand

11 India   11 Belgium

12 Syria   12 Germany

13 Mexico   13 India

14 New Zealand   14 Bangladesh

15 Bangladesh   15 Panama

16 Costa Rica   16 Jordan

17 Malaysia   17 Saudi Arabia

18 Philippines   18 Uzbekistan

19 Australia   19 Malaysia

20 Germany   20 Costa Rica

SWOT ANALYSIS• STRENGTHS:

• FAVORABLE CLIMATE CONDITIONS -> DIFFERENT ALTITUDES

• VAST ARABLE LAND

• MULTIPLE LOCATION OF DIFFERENT ALTITUDES/TEMPERATURES

• FERTILE SOIL

• PROXIMITY TO INTERNATIONAL AIRPORTS (JNIA, JKIA, ZNZ, AND KIA)

SWOT ANALYSIS• WEAKNESSES:

• UNDESIRABLE AND INEFFICIENT BUSINESS ENVIRONMENT (CORRUPTION)

• WEAK SUPPLY AND VALUE CHAINS RANGING FROM ON FARM PRODUCTIVITY TO DELAYS AT THE BORDER CROSSINGS

• INSUFFICIENT AWARENESS AMONG TANZANIANS ABOUT THE ECONOMIC AND SOCIAL POTENTIAL OF HORTICULTURE

• POOR FARMING EQUIPMENT AND USE OF TRADITIONAL IRRIGATION METHODS

WEAKNESSES CONTD.

• HIGH TAXES AND OTHER FEES

• INADEQUATE AVAILABILITY OF INPUTS

• HIGH COSTS OF TRANSPORTATION DUE TO POOR INFRASTRUCTURE

• PROBLEM OF LOCAL GOVERNMENT AUTHORITIES NOT ABIDING BY THE NATIONAL LAWS AND REGULATIONS GOVERNING PRODUCTION AND TRADE.

• LACK OF DEDICATED CARGO FLIGHTS

OPPORTUNITIES• INCREASING INVESTMENT FLOWS INTO AGRICULTURAL

ACTIVITIES IN EAST AFRICA

• EXPANSION OF THE JULIUS NYERERE INTERNATIONAL AIRPORT

• EXPANSION OF THE DAR ES SALAAM PORT AND BAGAMOYO PORT

• PROXIMITY TO RAPIDLY GROWING EXPORT MARKETS

• INCREASING AWARENESS OF THE HEALTH AND NUTRITIONAL BENEFITS OF THE HORTICULTURE PRODUCTS

THREATS

• CONTINUOUSLY RISING INTERNATIONAL STANDARDS

• CLIMATE CHANGE (GLOBAL WARMING)

• GROWING REGIONAL PLAYERS (RWANDA, KENYA, ETHIOPIA)

• EXPENSIVE FLIGHT COSTS TO NEIGHBORING COUNTRIES

• DELAYS AT THE BORDER POINTS

• LANDING FEES AND FUEL TAXES ARE MUCH HIGHER THAN IN KENYA

PROPOSED STRATEGY/RECOMMENDATION

• TO FIND MARKET NICHES WITH OUR EXISTING TRADE PARTNERS (IMPORT AND EXPORT)

• CAPITALIZE ON THE CUSTOMS UNION AND FREE TRADE AGREEMENTS REGIONALLY AND INTERNATIONALLY WITH EAC AND SADC

• PROPOSE FREE TRADE AGREEMENTS WITH ALL MAJOR TRADING PARTNERS (IMPROVE INVESTOR BUSINESS RELATIONS)

PROPOSED CONTD. • NEGOTIATE FOR MORE SUBSIDIZED PACKAGES FOR FARMERS

SUCH AS THE AMBER BOX WHICH IS DIRECTLY LINKED WITH PRODUCTION

• TARGET MORE A CERTAIN GROUP OF PEOPLE (AFRICAN) IN THE INTERNATIONAL MARKETS

• TARGET SMALL RETAIL SHOPS IN ASIA OR EUROPE AND NOT CHAIN SUPERMARKETS TO AVOID GOOD AGRICULTURAL PRACTICES (GAP) STANDARDS

• CONSTRUCT INDUSTRIES WHICH WOULD ADD VALUE TO THE PRODUCTS (PACKAGING) BEING EXPORTED RATHER THAN CASHING IN ON RAW MATERIALS.

THANK YOU

By Isaac Luseko