Kenya is working on a scheme aimed at improving the allure of Nairobi in the eyes of global firms seeking to expand operations to Africa, officials have said.
Industrialisation secretary Adan Mohamed is set to meet the Kenya Association of Manufacturers (KAM) officials to lay the foundation for the strategy which is also meant to rev up the country’s industrial engine.
Mr Mohamed said on Wednesday last week that his ministry will seek views from the private sector on laws and policies that should be reviewed or enacted in the race to attract global industries to set up shops in Kenya.
“We will be having some tough, tough conversations. Be ready to be challenged and we are ready to be challenged as well,” Mr Mohamed told industrialists on Wednesday last week. “We will put on the table things that can be fixed. What can be done, we will do it. What can take longer, we can put a plan together for implementation.”
President Uhuru Kenyatta has pledged to mobilise State resources to support growth in manufacturing, one of the Big Four Policy Agenda in his legacy term to August 2022 together with universal healthcare, food security and affordable urban housing.
Manufacturing, whose contribution to the gross domestic product (GDP) has been stagnant at about 10 per cent in more than a decade, has been overshadowed by the services sectors which have driven Kenya’s growth in that period.
The sector’s contribution to GDP in 2016 hit a new low of 9.2 per cent and Uhuru’s administration faces a tough task to grow this to targeted 15 per cent by 2022.
“Everybody is racing to Africa. If we don’t get this game right, I don’t see how we are going to grow manufacturing to 15 per cent of our GDP,” KAM chairperson Flora Mutahi said.
“Factors that drive manufacturing are only two: competitiveness and access to markets. If we don’t change that, it is not going to be possible because we don’t have enough market.”
The World Bank Group in 2011 estimated that about 80 million jobs were likely to leave China this decade as light industries flee rising labour costs in Beijing with Africa their most likely destination.
The cost of doing business in Kenya, KAM has said, remains relatively high largely due to unpredictable policy framework, multiple fees and levies at the 47 counties, high cost of electricity and inefficiencies at factory level.