Ruto Unveils Ksh 7B Boost and Low-Interest Loans to Modernize Tea Sector

Key Highlights

• President Ruto announced a Ksh 7B deposit recovery for KTDA from collapsed Chase Bank and Imperial Bank.
• Government to provide affordable loans at 5% interest via Kenya Development Corporation (KDC) to modernize tea factories.
• Kenya’s tea export earnings rose from Ksh 138B in 2022 to Ksh 215B in 2024, with a target of Ksh 270–280B by 2027.
• Farmers’ average earnings increased from Ksh 51 to Ksh 64 per kilo of green leaf tea in two years.
• KTDA urged to scale up orthodox tea production, which has grown from 1.2M kg to 13M kg.
• Kenya exploring new markets in China and Japan to boost tea exports.
• Government pledged to clear Ksh 2B owed to tea farmers by December 2025.

President William Ruto has unveiled a major financial relief package for the tea industry, announcing the recovery of Ksh 7 billion in deposits owed to the Kenya Tea Development Agency (KTDA) from the collapsed Chase Bank and Imperial Bank.

The recovered funds, he said, will be disbursed through the Kenya Development Corporation (KDC), which will also provide affordable loans to tea factories at a 5 percent interest rate, down from the 18 percent charged by commercial banks.

The financing is expected to help modernize outdated factory equipment and expand value addition.

“Some of the equipment being used by factories is old and must be modernized,” Ruto said, adding that the reforms were designed to strengthen productivity and competitiveness in the sector.

The president highlighted the gains already realized from ongoing reforms, noting that average farmer earnings had risen from Ksh 51 per kilo of green leaf in 2022 to Ksh 64 per kilo this year.

Similarly, tea export earnings have grown from Ksh 138 billion to Ksh 215 billion within the same period.

“My push is to raise our tea exports to between Ksh 270 and 280 billion by 2027,” Ruto said.

To sustain this growth, KTDA has been urged to scale up production of orthodox tea, which is rapidly gaining international market share.

Kenya’s output of orthodox tea has already grown from 1.2 million kilos to 13 million kilos.

The government has also struck new trade deals, including tariff removals by China, and is negotiating lower tariffs with Japan to secure greater market access for Kenyan tea and other agricultural products.

Ruto further pledged that his administration would clear at least Ksh 2 billion owed to tea farmers by December this year, reaffirming the government’s commitment to farmer welfare and rural livelihoods.