By Kepher Otieno - Reporter
Kenya, 4 August 2026 - Eighteen months after Kenya's government struck a landmark compromise with the country's aquaculture industry over a controversial 5% fish levy, the agreement remains unimplemented, triggering growing concern among investors and raising fresh questions over policy certainty in one of the country's fastest-growing blue economy sectors.
Fish farmers now warn that prolonged government inaction is undermining business confidence and threatening billions of shillings in private investment around Lake Victoria.
The Lake Victoria Aquaculture Association (LVA) says the delay has left producers in regulatory limbo as uncertainty hangs over whether the government will enforce the disputed ad valorem levy despite a negotiated settlement reached through a task force established by Blue Economy Cabinet Secretary Ali Hassan Joho. Farmers argue the levy would significantly increase operating costs at a time when producers are already grappling with licence fees, rising input prices and an increasingly competitive market.
LVA Secretary and Task Force Co-Chair Pete Ondeng said industry players entered negotiations in good faith and spent months crafting a compromise acceptable to both government and business. He said the Cabinet Secretary welcomed the recommendations and pledged to implement them, but nearly two years later the agreement remains shelved without explanation.
"We went into that process in good faith," Ondeng said. "Our people put in enormous time and effort to reach a compromise both sides could live with. To see that work sit untouched, with no explanation, is more than disappointing."
The industry has now formally requested an urgent meeting with the Cabinet Secretary, seeking clarity over the government's position following a recent High Court ruling that upheld the legality of the levy regulations but did not determine whether the government was bound to honour the negotiated agreement. LVA insists the dispute is no longer about the legality of the levy, but about government credibility and adherence to commitments made through structured public-private dialogue.
The uncertainty has spilled back into the courts. Kisumu fish farmer Victor Didi has secured interim orders protecting cage farmers from enforcement of the levy pending determination of a fresh petition, further highlighting the unresolved policy environment confronting investors in the sector.
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Industry leaders warn the timing could hardly be worse. With western Kenya struggling to revive traditional economic pillars such as sugar, cotton and capture fishing, aquaculture has emerged as one of the region's few bright investment prospects, attracting substantial private capital while creating employment opportunities for thousands of young people. They caution that prolonged policy uncertainty could discourage future investment just as the industry begins to scale up.
Victory Farms Chief Development Officer Caesar Asiyo said the dispute had evolved into a broader test of investor confidence.
"This has stopped being only about the levy," Asiyo said. "It is now about whether Government can be trusted to keep its word. If we negotiate in good faith, reach an agreement, and then watch it go nowhere, why would any investor believe the next promise either?"
Pressure is now mounting on President William Ruto's administration after industry stakeholders launched a petition seeking State intervention, while political leaders have begun weighing into the dispute, signalling that the standoff is rapidly evolving from a sector-specific disagreement into a broader debate over Kenya's investment climate and the credibility of government commitments to private enterprise.