Up to 1,000 people set to lose jobs in Kenya’s floral sector

In a surprising turn of events, multi-national flower firm Finlays Kenya has announced the closure of its two farms in Kericho County, leading to the loss of over 1,000 jobs before the end of the year. This decision has sent shockwaves through the floral sector in Kenya, raising concerns about the industry's sustainability and the impact on the country's economy. CEO of Kenya Flower Council, Clement Tulezi, shed light on the situation in a recent interview on CNBC Africa. Tulezi emphasized that the closure of the farms is not a reflection of a lack of confidence in the flower industry in Kenya but rather a strategic business decision made in response to various challenges on the ground. One of the key factors contributing to the closure is the high cost of doing business in Kenya, including labor costs, taxes, permits, and government support. Tulezi highlighted that the ease of doing business in Kenya has been a longstanding issue, with various financial burdens eating into the bottom line of companies like Finlays. The closure of the farms has sparked speculation among some unions in the agricultural sector, who suggest that it may be an attempt by the company to avoid honoring a 30% salary increment promised to workers since 2014. However, Tulezi refuted these claims, clarifying that the decision to close the farms was made last year and is not related to the wage increment issue. He emphasized that sustainability of wages is a critical consideration for businesses like Finlays, especially in a market facing unprecedented challenges such as low flower prices. Tulezi underscored the long-term investment perspective of the industry, noting that decisions regarding labor costs are essential for business continuity and growth. The closure of the two farms in Kericho County is expected to have a significant impact on the floral sector in Kenya, with implications for the entire horticulture industry. Tulezi highlighted the importance of government intervention to support the sector, citing high costs of energy, inputs, water, and land, as well as numerous taxes and levies imposed on industry players. He emphasized that the government's support is crucial for the industry's survival and growth, given its substantial contribution to the economy and employment in Kenya. The flower industry in Kenya is the second-largest export commodity after tea, employing over 150,000 people directly and supporting millions of livelihoods across the country. Tulezi called for urgent government action to address the challenges faced by the sector and ensure its sustainability in the long run. The closure of Finlays' farms serves as a wake-up call for the floral industry in Kenya, highlighting the pressing need for structural reforms and support to prevent further job losses and economic repercussions.