State seeks revamp of trading firm to stabilise food imports

By Macharia Kamau | Feb 18, 2023
Workers park bags of maize at Kitui flour mills store after buying from maize farmers in Eldoret. [Peter Ochieng, Standard]

The government wants to prop up the Kenya National Trading Corporation (KNTC) to help it grow capacity to import essentials as well as improving its warehousing capabilities.

The Ministry of Investment, Trade and Industry this week made a pitch to the African Export Import (Afrexim) Bank to support the agency with financing to enhance its capacity in importation of commodities such as grains, edible oil and fertiliser, and revamp its warehouses across the country.

The ministry in a meeting with the bank said a strong KNTC would play part in enabling the country meet such goals as food security through financing of imports.

Senior officials led by Cabinet Secretary Moses Kuria also noted that with financing from the bank, KNTC would be able to revamp its warehousing infrastructure and help improve food security and lowering the cost of living in the country.

KNTC's increased participation in the local and regional trade also formed part of the discussions between the ministry and bank officials during the meeting held in Cairo, Egypt.

"Given the macroeconomic and geopolitical landscape, with supply chains experiencing unprecedented disruption, the bank's capacity to support Kenya in its food security aspirations ranked high on the agenda, with extensive conversations on the bank's import finance facilities to support the Kenya National Trading Corporation, to enable the company to guarantee sufficient importation of key commodities including grains, edible oils and fertilisers," said a joint statement by Afrexim Bank and the ministry.

The statement said the parties "discussed at length what Afrexim Bank could do to assist KNTC develop relevant infrastructure including warehousing facilities in the counties, to support aggregation, value addition and packaging of goods for both local and export markets."

The meeting was a follow up to discussions held between President William Ruto and the bank's president Benedict Oramah in November 2022 at State House, Nairobi.

At the meeting, it was also agreed that KNTC should join the Afrexim Bank's African Trade Exchange (Atex) project.

The Pan-African commodities supply platform, the bank said, would enable KNTC benefit from pooled procurement of key commodities and attendant financing.

Kuria proposed a partnership between Atex and the Kenya Multi Commodities Exchange programme and Kenyan fintech companies in the value chains to accelerate market linkages between producers and international markets.

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