CS Mutahi Kagwe Urges Urgent Investment In Agriculture, Warns Of Food Security Threat

Agriculture Cabinet Secretary Mutahi Kagwe has sounded the alarm over the chronic underfunding of Kenya’s agriculture sector, calling for immediate, targeted investment to safeguard national food security and economic resilience.

Speaking at the FINAS-2025 Summit in Nairobi on Tuesday, Kagwe declared agri-financing a “moral imperative” and challenged banks, policymakers, and the private sector to move beyond discussion and deliver tangible support to farmers.

“This is a pivotal moment. Financing food systems is not just an investment opportunity it is our duty,” he told delegates at the high-level gathering, which brought together government officials, development partners, financial institutions, and farmers.

Despite agriculture’s central role in Kenya’s economy, the sector receives only 3 percent of the national budget far short of the African Union’s recommended 10 percent allocation.

Kagwe emphasized that this gap undermines food security efforts and threatens the livelihoods of millions of Kenyans.

He proposed that 80 percent of all agriculture-related budget allocations go directly to farmers, minimizing administrative overheads and maximizing impact.

Kagwe further noted that in 2023, agriculture received a mere 3 percent of the country’s US$49 billion loan portfolio, describing it as a major disconnect between financial institutions and the realities of smallholder farming.

He called for the revival of a policy requiring banks to allocate a portion of their assets to agri-lending, tailored to the unique challenges faced by small-scale farmers.

To support this vision, Kagwe proposed the creation of a government-backed agriculture development fund, modeled on the successful Constituency Development Fund (CDF), and managed by the Agricultural Finance Corporation (AFC). Currently, the AFC meets only 25 percent of the sector’s financing needs.

“We cannot expect to build sustainable food systems without strong private sector participation and a robust financial foundation,” Kagwe added, urging for collaborative innovation in credit, insurance, and agri-tech solutions.

The FINAS-2025 Summit concluded with broad consensus on the need for bold reform, with multiple stakeholders expressing support for increased funding, policy revision, and targeted partnerships to revitalize Kenya’s agriculture sector.