CENTRAL BANK OF KENYA
CENTRAL BANKS’ 2016 FORUM PREPARATORY ROUND TABLE MEETING
Kenya School of Monetary Studies, Nairobi
Speech by Dr. Patrick Njoroge
Governor of the Central Bank of Kenya
November 9, 2015
As Prepared for Delivery (751 words)
Ladies and Gentlemen, It is with great pleasure that I welcome you to Nairobi for
the Round Table meeting. Let me at the outset express my gratitude to AFRACA
for organising this meeting as well as the Technical Centre for Agricultural and
Rural Co-operation (CTA) for their continued support. I am aware that this is an
agenda-setting meeting, which is supposed to be a precursor to the upcoming 2016
Central Banks Forum. This planning meeting is therefore very necessary by virtue
of the different regions represented here today.
It is indisputable that the support of regulators is key in the success of agricultural
Financing. Without appropriate rules, regulations and guidelines from the Central
Banks, commercial banks and other investors are not likely to come to the
agricultural commodities market and it is therefore imperative that Central banks
are on board early in facilitating process and procedures that embed within
respective country statutes.
Poverty remains is still a universal situation in the African continent and living
standards need to improve further. Whereas most countries in Africa have
improved macro-economic conditions and infrastructure, the low productivity in
agriculture has left most of the workforce still underemployed in this sector.

The IMF 2014 Regional Economic Outlook Report for Sub-Sahara Africa
observed that increasing agricultural productivity delivers significant social
dividends to the population living in the continent.
First: Agriculture employs by far the most individuals and gains in agriculture are
important because many workers will remain in the sector for a long time as
agriculture is more labor intensive than other sectors.
Second: Compared to the Formal Job Market, the skills needed for agricultural
activities are less specialized and require less training.
Third: evidence from the Sub-Sahara Africa suggest that growth in agriculture in
the last few decades has been among the most important contributors to poverty
more decisively than growth in cash crops.
Ladies and Gentlemen: Access to finance remains a major constraint to
agricultural development. Whereas African countries have focussed on providing
larger access to credit to the poor, through special credit lines or specialized credit
institutions, including state-owned banks and microfinance institutions, empirical
evidence on the impact of these interventions have had mixed results.
Indeed, Kenya’s financial legal landscape has seen significant changes. The
Central Bank of Kenya has made significant strides in promoting financial
inclusion which extends to rural and agricultural communities as well. Mobile
Banking Technologies and agency banking models have ensured that rural
communities can easily access finance within their localities.
The central Bank of Kenya Act and Banking Act have been amended, national
Payment Systems Act enacted and a host of regulations and Prudential guidelines
adopted to provide for the development of robust legal, regulatory and supervisory
frameworks for both mobile financial services and agency banking to thrive.

SACCOs are equally important institutions in rural and agricultural economies and
CBK has instigated appropriate reforms in the SACCO sector to ensure sound
management practices are in place for effective financing of rural communities.
Ladies and Gentlemen, as we commence these deliberations today, we also need to
remain cognizant of new challenges that keep emerging in the various regions that
we come from. Food Security, Climate Change as well as Ebola and Political
Insurgencies/conflicts remained a threat to Agricultural communities and need to
be addressed, concertedly.
Nonetheless, we certainly need to take a long and serious look at our agricultural
situation in the continent and see what role the Central Bank can actively play in
developing solutions for agricultural communities in Africa. I am very encouraged
to see various stakeholders participating in this Round Table Meeting. Central
Banks can play a crucial role of ensuring the success in agriculture by capturing
the views of all the stakeholders to shape appropriate policies
AFRACA has, and continues to play a crucial role as a lead advocate in providing
international platforms, such as this one, to bring both public and private sector
players together to deliberate on how we can increase investments in Agriculture.
The AFRACA Central Banks Forum is an important event in our Calendar and we
want to give it special focus. I sincerely hope that your interest will be sustained
throughout the two days of discussions and deliberations. I am very optimistic that
the 2016 Central Bank’s forum will stimulate new thoughts for policy and
practical actions in rural and agricultural finance in Africa.
With these remarks, Ladies and Gentlemen, it is my pleasure to declare the
‘Central Banks 2016 Forum Preparatory RoundTable Meeting’ in Nairobi
officially opened.
Thank You