EU Import duties on Kenyan flowers threaten future of Fairtrade producers

EU Import duties on Kenyan flowers threaten future of Fairtrade producers

Fairtrade urgently calls for the EU and Kenyan government to find a solution which guarantees continued duty-free access for Kenyan cut flower imports, to protect the livelihoods of thousands of Kenyan flower workers and their families, before 1 October deadline.
“On behalf of all workers from Fairtrade certified flower farms in Kenya, we are deeply sad following recent news that from 1st October 2014 import duty exemption for Kenyan cut flower destined for EU market will be expiring. As fundamental stakeholders in the industry, we anticipate that when the new trade conditions become operationalized the market price of the produce will significantly rise. Consequently, the competitive demand for the Kenyan flowers will drastically drop favoring other sector players who will continue enjoying preferential trade terms and access. Therefore the sustainability of the business and livelihood of many workers, their siblings and members of the various communities deriving their dependency from this sector will be drawn into jeopardy.
“Surprisingly, the main social-economic gains so far achieved ranging from improved health care, education and enhanced standards of living among workers and the community attributed to Fairtrade business will begin to disintegrate. We feel so sad watching helplessly as the scenario push us to unemployment status and hopelessness
“As we look forward for the fruitful and meaningful EPA negotiations, it is our humble submission that the Kenyan flowers sector is permitted to continue enjoying its previous import duty exemption status beyond 1st October 2014. We guarantee EU member states that as workers we will continue supporting the industry sustainably and it is our sincere prayer that our plight is keenly reviewed taking cognizant of the negative impacts that will arise with the changes.”
– Grace Cherotich Mwangi, Fairtrade Africa Workers Representative

A new duty on cut flowers could have a devastating impact on Kenya’s flower industry, including 32 Fairtrade certified flower farms that together employ 32,000 workers.

At present, there is no duty on cut flowers exported from Kenya to Europe, but from 1 October a duty ranging from 5% – 8.5% is set to be introduced.
The tariff is being imposed because, despite long-running negotiations on an Economic Partnership Agreement (EPA) since 2002, the EU and East African Community (EAC) have failed to find a way to secure a continuation of the zero tariffs for cut flowers from Kenya.

Livelihoods of thousands at stake
More than 500,000 people, including 90,000 direct flower employees, depend on the flower industry for their livelihoods. The cut flower industry has become Kenya’s second most important foreign exchange earner, producing exports worth almost €360 million annually.
If introduced, the duty will increase the price of Kenyan cut flowers considerably, threatening farms’ ability to compete with cheaper alternatives. It could also mean potentially devastating job losses for workers in Kenya’s flower industry. The majority of these workers are women, and for many it is their only source of income to support their families.

Fairtrade flower farms also face devastating consequences
Over the past ten years Fairtrade has worked to establish fair trading relationships between European businesses and Kenyan flower producers. 44% of all cut roses produced in Kenya now come from Fairtrade certified farms, with the EU being the chief export market. Producers have diligently built up their organizations, meeting the Fairtrade Standards and investing the Fairtrade Premium in education, better housing, healthcare and infrastructure such as roads. Workers have benefitted from better working conditions, more knowledge about their rights and more autonomy through workers’ committees.
If Fairtrade flower farms suffer a drastic loss of sales, or in worst case go out of business, all their hard work and achievements over the past decade would be undermined. Workers on Fairtrade farms could lose their jobs and their livelihood.

Fairtrade calls for swift and fair solutions
We are calling on the EU and Kenyan government to urgently find a just and fair solution which ensures that cut flowers from Fairtrade farms continue to have tariff-free access to European markets, to protect the livelihoods of thousands of Kenyan flower workers and their families.

Q&A

What are EPAs?
Economic Partnership Agreements (EPAs) are trade agreements meant to safeguard ACP countries’ preferential access to EU markets, which had previously been granted through the Lomé Convention. However, EPAs are changing this preferential access from non-reciprocal to reciprocal access, meaning that ACP countries who sign have to open their markets to EU imports, and liberalize in other areas too.

Negotiations on EPAs have been happening since 2002. Some regions have already signed EPAs; in others, such as East Africa, the negotiations are ongoing.

Why are the negotiations taking so long?
The issues surrounding EPAs are quite complex. One of the main concerns is around the reciprocal nature of the agreement – developing countries must lower taxes (tariffs) on goods coming from the EU. Many developing countries are concerned that this will have negative consequences for the country’s development.
In Kenya, outstanding issues in the negotiations are export taxes, domestic and export support to agriculture, and human rights.

What do NGOs and civil society think about EPAs?
EPAs are very controversial and have been highly criticized by NGOs and wider civil society. This is also the case in Kenya, where many civil society groups have welcomed the fact that the government has not signed the EPA.
100% Fair Trade organization Traidcraft has detailed information on EPAs on their website. http://www.traidcraft.co.uk/get_involved/campaign/trade_rules/stop_epas/faq/

What products will be affected by the tariffs?
In Kenya, the main products which will be affected are cut flowers, fruits and vegetables.

What can I do?
You can express your concern by sending a letter to your Head of Government, asking them to raise this issue at EU level. You can download an example letter here.

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