Producer Perceptions, Economic Value and Incentives for Promotion of Potential Geographical Indications in Kenya
Abstract
Product differentiation can be a means to contribute to economic growth and development
through increasing rural incomes and thereby enabling agricultural producers to contribute
towards sustainable environmental management. Use of Geographical Indications is one such
differentiation option that can benefit agricultural producers in the marketing of products whose
given quality, reputation or other characteristics are exclusively or essentially attributable to its
geographical origin. Geographical Indications (GI) mainly distinguishes products that differ due
to characteristics and attributes inseparably linked to the geographical region of production,
unlike other trademarks and standards. Kenya, as a member of the World Trade Organisation and
a signatory to the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement, is
able to benefit from GI protection and marketing, as several agricultural and forestry products
have unique place-based qualities in the country. However, considering most agricultural
products exist in a ready market and within consumer preferences, understanding producers’
willingness to adopt changes that would be required to enhance such protection is important. The
producers’ willingness to protect the products with GI as well as their perceptions are a result of
the experiences with the production, markets as well as existing value chain actors and
institutions.
The objective of this study was therefore to estimate producer perceptions, economic values and
institutional incentives that would influence promotion of unique agricultural products as
potential geographical indications in Kenya. Specifically, the objectives were to: (i) identify and
characterise origin products with potential to be registered as GI in Kenya; (ii) determine
producer awareness and perceptions of territorial qualities in their origin products (products
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perceived to have added value that is due to its place of origin); (iii) estimate producer economic
values of the origin products as potential geographical indications; and (iv) describe policy and
institutional incentives influencing evolvement and development of potential GIs in the country.
Potential GI products were identified through interviews with key informants and focus group
discussions. The developed criteria provided a basis to score and rank the identified products
based on perceptions of their uniqueness. The four highest ranked products were then used in the
study to answer the second, third and fourth objectives. Theoretically, the study is grounded on
the random utility maximisation theory, the institutional theory and the theory of planned
behaviour. The study on producer preferences was based on choice experiments, a non-market
valuation technique. Factor analysis summarised producer perceptions for each product to
determine the underlying patterns in their attitudes. The products and respective sample sizes
were Baringo (Goats [n=135]), Kirinyaga (Tea [n=134]), Murang’a coffee [n=135]) and
Makueni (apple mango [n=137]). The research design included qualitative, quantitative and case
study approaches. Data collection involved use of literature review, key informant interviews,
focus group discussions, semi-structured questionnaires to elicit producer perceptions (likert
scale questions) and preferences for registering their respective products as GIs as well as other
socio-economic and institutional data. SPSS, NGENE, MS Excel and NLOGIT were used in data
entry and/or analysis.
Generally, the respective producers are aware of the territorial-based uniqueness of their
products. Reduction of producer perceptions using factor analysis produced factors that were
product specific. The highest variation in the factor analysis was from institutional-related
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factors for each of the products. These were the role of private and public sector in coffee
production; price information and market access in tea production; and role of policies and rules
in mango production. In goat production, the role of the environment and its sustainability
accounted for the highest variation.
The choice experiments revealed that tea and coffee producers’ willingness to pay was KES 900
and KES 600 respectively for minimum guaranteed returns associated with GI protection. Mango
producers’ willingness to pay was KES 399 for GI protection in order to access price information
at the beginning of the season, while the WTP for goat producers was KES 350 to have
coordinated channel of selling their products with attribution to the region. The total willingness
to pay (Total WTP) for GI protection was positive for each of the four agri-food products
analysed.
Institutional factors and actors in the current value chains are important for success of GI
protection. There are both incentives and disincentives for GI protection within the existing
organisation and institutional structures. In Baringo (goats), collective action, which involves
both state and community actors, is in place to regulate actions in the industry. However,
producers mainly prefer to trade individually, and are hence not able to benefit from the
collective action. Coffee and tea, both export products, are characterised with value chains that
go beyond the national borders. Whereas this would make it easier to regulate due to the
government’s efforts towards regulating these scheduled crops, the role and influence of external
actors complicates the value chain process more. Therefore, the role of institutions and actors
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should attract the highest consideration and efforts, in order to successfully register agri-food
products in Kenya with geographical indications.
The study concludes that whereas producers are willing to pay for GI protection of agri-food
products, the current policy and institutional environment serve as a disincentive to successful
implementation of the concept in Kenya. The assessment highlights the importance of having an
effectively enforced sui generis GI law, with the potential to enhance social inclusion, economic
benefits and environmental sustainability in the production regions. This would reduce the
potential problems of moral hazard and free-riding that may arise from the GI registration. The
prescriptive GI law is also necessary to provide guidelines on producers who may not be willing
to participate in the protection, but are still involved in production of similar product within the
production region.
Keywords: Characterisation; Geographical indications; institutional incentives; policy
incentives; producer awareness; producer preferences; producer perceptions, origin products;
territorial attributes
Publisher
University of Nairobi
Rights
Attribution-NonCommercial-NoDerivs 3.0 United StatesUsage Rights
http://creativecommons.org/licenses/by-nc-nd/3.0/us/Collections
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