One third of workers face axe in the once blooming flower sector

Horticulture is one of the most important industries in Kenya.

Last year, it emerged the top foreign exchange earner for the second time in a row, raking in Ksh70 billion ($875 million), up from Ksh56 billion in 2007.

Estimated to employ some three million people, it is a labour intensive industry and the only one in the country that has recorded sustained growth — 10 per cent per annum — over the past 20 years.

When Kenya’s economy was on negative growth rates, horticulture still managed to record growth.

Last year was probably the most telling: the sector defied the negative effects of post-election violence to grow its volumes and earnings.

And while the industry’s fortunes are largely attributed to favourable markets and Kenya’s good climate, it has also grown out of being a largely private sector-driven initiative and is self-regulated and market driven.

It is, therefore, not surprising to see the concerted efforts being fronted to save the sector from collapse.

At the moment, at least one third of the employees of the industry face the axe this year as the global financial crisis stifles demand in key export markets.

Demand for Kenyan flowers has shrunk by 30 per cent in the first quarter of the year, compared to the same period a year earlier, as consumers in rich countries cut down consumption due to layoffs, employment freeze and fear over job losses there.

In what appears to be the first of signals that this year could be one of confrontation between agricultural workers and their employers, trade unionists have vowed to block any attempt to lay off their members.

The union has locked horns with Oserian Flowers over plans to retrench some 208 workers and Sher Agencies, which gave it a notice of intention to retrench 545 employees. Many smaller farms were also planning layoffs.

Industry insiders say the busiest time of the year, which normally coincides with the winter months of the West, did not bring in good returns this year because the harsh winter discouraged people from leaving their homes. Back home, the prolonged drought has added to the effects of the post-election violence.

Earlier attempts to open new frontiers in Japan and Russia, since engulfed by the global recession, now look less promising.

Although the industry easily shrugged off the turbulent operational environment in 2008 to realise a climb in earnings over the previous year, players say most of this profit was eaten up by the currency swings of the period.