The government is pushing for sweeping legislative reforms to compel value addition of all Kenyan agricultural products before export, Agriculture and Livestock Development Cabinet Secretary Mutahi Kagwe has announced as the country marked International Tea Day at Momul Tea Factory in Kericho County .

Kagwe issued a direct challenge to Parliament and Senate Majority Leader Aaron Cheruiyot to spearhead laws ensuring raw commodities are processed locally, arguing that exporting unprocessed produce continues to deny Kenya employment opportunities while enriching foreign industries .

China Market Breakthrough Secured

Speaking under the theme “Fostering Growth and Inclusion,” Kagwe revealed that Kenya has secured duty-free access for tea exports to China following bilateral engagements spearheaded by President William Ruto. He described the Chinese market as a major breakthrough for the tea industry .

The Cabinet Secretary acknowledged traditional tea importers including Pakistan, Egypt, Sudan, India, and Sri Lanka for sustaining demand over the years. However, he noted that overreliance on a limited number of export destinations remains a significant vulnerability .

Kenya is now pursuing deliberate strategies to expand tea presence across Asia, the Middle East, Europe, Africa, and North America, with the Tea Board of Kenya specifically targeting North Africa and North America while seeking to deepen presence in the UAE .

Sh4.5 Billion Factory Modernization Program Unveiled

Agriculture Principal Secretary Dr. Paul Rono announced that the government is mobilizing Sh4.5 billion to modernize tea processing and expand value-addition infrastructure. The program targets aging factories and weak value addition capacity within the smallholder tea subsector .

Rono said Sh1 billion has already been secured, with discussions ongoing through the sector working group and budget committee to raise the remaining Sh3.5 billion. The investment seeks to reduce production costs, improve operational efficiency, and strengthen value addition in the sector that supports millions of livelihoods .

“Many small tea factories are unable to put up modern value addition infrastructure on their own. Through this program, we want to create stronger support systems that will help farmers benefit more from their produce,” the PS stated .

Tea Levy Takes Effect to Fund Industry Programs

The Tea Levy Regulations 2026 officially took effect on May 1, imposing a 0.8 percent levy on tea exports at auction value or customs value for direct sales. Kagwe defended the initiative, saying it is intended to provide sustainable funding for tea promotion, branding, research, quality assurance, and market expansion .

The Cabinet Secretary assured farmers the levy would not impose unnecessary burdens, explaining that funds collected would be reinvested into strengthening the tea sector’s competitiveness. Value-added teas packed in containers not exceeding 10 kilograms, tea extracts, and teas processed within Export Processing Zones are exempted from the levy to promote local value addition .

However, Kagwe warned factory directors against using court battles to frustrate reforms: “On tea levy we are open to keep engaging stakeholders and don’t use litigation as a bargaining power. The levy is being charged at the point of export and factory directors should not waste millions of tea farmers’ funds in unnecessary litigations on matters which they already litigated and consented to in April 2024” .

Push for Product Diversification Beyond CTC Tea

Kagwe stressed that Kenya must increasingly move towards orthodox teas, specialty teas, green teas, purple teas, herbal blends, branded consumer packs, and tea bags that attract premium prices in international markets .

“Every time we export tea in sacks, we are exporting jobs to other countries. We need those jobs here in Kenya for our young people,” Kagwe said. “We want consumers across the world to specifically identify and demand Kenya tea. That is why we must invest heavily in branding and promotion globally” .

The CS further challenged hotels and hospitality establishments to use International Tea Day celebrations as an opportunity to promote local tea consumption, saying increased domestic demand would complement export markets .

Climate Action and Youth Engagement

The Cabinet Secretary noted that climate change remains one of the greatest threats to sustainable tea production. The government is promoting climate-smart agriculture, environmental conservation, renewable energy adoption, and sustainable land-use practices within tea-growing regions .

Kagwe donated over 100,000 tea seedlings and another 100,000 avocado seedlings to farmers in Kericho during the celebrations, supporting the government’s target of planting 15 billion trees by 2032 .

The event also featured a Youth Festival and Tea Innovations Exhibition showcasing emerging ideas across the tea value chain, including new tea products, digital applications, and entrepreneurship ventures targeting young people .

Present at the function were Kericho Senator Aaron Cheruiyot, Agriculture PS Paul Rono, Ambassador Florence Bore, KTDA National Chairman Enos Njeru, and Kenya Tea Board CEO Willy Mutai, among others .

Tea remains one of Kenya’s leading foreign exchange earners, with total marketed earnings reaching Sh218.79 billion (US$1.69 billion) in 2025, a 2 percent increase driven by reforms and market expansion.