Flamingo Reinvests VAT Refunds to Expand Exports and Add 2,000 Jobs

By benadeta mwaura - Reporter

Kenya, January 27 ,2026 - Flamingo Horticulture Kenya is reinvesting its VAT refunds into a significant expansion of operations in Naivasha, a move expected to boost export capacity, create about 2,000 new jobs, and deepen value addition in Kenya’s horticulture sector.

The expansion marks a strategic shift towards local processing and value retention, and highlights both the promise and challenges inherent in Kenya’s VAT refund system. The company, a subsidiary of Flamingo Group International, currently exports more than 750 million flower stems annually and directly employs around 12,000 workers, while supporting more than 6,000 supply chain partners and out growers.

By reinvesting the refunds owed by the government, the firm aims to scale up production of Fair trade accredited bouquets destined primarily for the United Kingdom and European markets. The expansion will also include packhouse upgrades, infrastructure development, and adoption of climate smart technologies, such as water efficient systems and integrated pest management, all centred on Flamingo’s 1,630 hectares of farmland in the Naivasha region.

This reinvestment strategy represents a deliberate effort to retain more of the value chain in Kenya, rather than exporting unprocessed blooms through European auction houses. By processing and “source packing” bouquets locally, Flamingo not only aims to improve profit margins but also to strengthen Kenya’s position as a regional agribusiness export hub.

The expansion plans were initially unveiled at the 2025 Kenya Investment Forum in the United Kingdom, in a session attended by President William Ruto, signalling high level support for export led growth in agriculture.

Agriculture Cabinet Secretary Mutahi Kagwe welcomed the move, saying that the reinvestment reflects growing confidence in the horticulture sector and underscores the importance of local value addition in driving employment and long term sustainability.

He emphasised that enhancing local processing ability is critical to expanding jobs not only at Flamingo itself but across the broader horticulture value chain that serves both regional and global markets. However, Flamingo’s reinvestment comes against the backdrop of ongoing national discussions on VAT refunds, which have increasingly dominated Kenya’s industrial policy conversations.

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Trade and Investment Cabinet Secretary Lee Kinyanjui has repeatedly warned that delayed VAT refunds, some owed in the billions of shillings, are hurting investor confidence and undermining expansion plans for firms across manufacturing and export oriented sectors.

He has pressed the Kenya Revenue Authority (KRA) to clear outstanding refunds more rapidly while also reviewing VAT rates on exports to sustain competitiveness. Critics have argued that slow refunds create cashflow bottlenecks for exporters and weaken Kenya’s industrial growth prospects if not urgently addressed.

The horticulture industry is particularly sensitive to these delays, as exporters often incur significant input taxes upfront and rely on timely refunds to sustain operations and reinvest in growth. A more efficient VAT refund regime, combined with supportive policies for value addition, could help Kenya fully capitalise on expanding global demand for fresh flowers, a market where it has historically been a leading exporter.

Recent government efforts to streamline horticulture governance and logistics, including pest compliance and cold chain enhancements, are also aimed at maintaining the sector’s edge amid shifting export regulations in key markets like the European Union and the UK.

Ultimately, Flamingo’s reinvestment of VAT refunds underscores both the potential of Kenya’s horticulture export sector and the importance of predictable tax administration for enabling private sector led job creation and economic growth.

As export markets evolve and competition intensifies, robust policy frameworks that include timely tax relief, value addition incentives, and efficient trade logistics will be crucial to sustaining the sector’s contribution to jobs, foreign exchange earnings, and inclusive development.