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With many Kenyans holding great expectations that life will improve with a more effective and accountable government, the Kenyan Association of Manufacturers (KAM) has put together an agenda emphasising the implementation of reforms and measures to spur productivity and efficiency of services.
The KAM Industrial Business Agenda includes:
- Ensure energy security - Due to the key role provision of energy plays, the cost of the products from a manufacturing process will be related to the cost of energy; all other factors such as efficiency of production, cost of labour and raw materials notwithstanding. Therefore the higher the cost of energy, the higher the price of products.
- Unblock the logistics corridor from the Port - Kenya’s Port of Mombasa plays a strategic role in the facilitation of trade both for Kenya and neighbouring countries. Manufacturers in particular face numerous challenges when Port performance is inadequate, holding the view that Port performance, transit costs and procedures lie at the heart of an effective supply chain.
- Make it less taxing to pay taxes - Kenya remains among the most heavily taxed economies in the world with 43 percent of businesses in the country finding tax administration a major constraint. The government should increasingly focus on making takes less burdensome on business and simple to administer.
- Achieve meaningful regulation - The current framework imposes high transaction costs on businesses through the high number of licences required, as well as the administrative burden imposed by regulators. We are increasingly seeing the introduction of new licences, watering down the government’s licensing rationalisation programme.
- A wage policy that supports employment expansion - Kenya requires a wage policy that will support the creation of jobs in the manufacturing sector. For a country with large unemployment, it is critical to ensure that labour market regulations don’t hamper absorption, especially of young persons.
- Make it possible/easier to sell our goods and services - Industrial procedures need to be supported with access to market. The incoming government must safeguard Kenya’s open trade policy and further enhance and actively pursue initiative to grow and diversify Kenyan exports.
- Keep the country moving swiftly and safely - A good transport network is critical to the functioning of a competitive economy. An efficient and safe system will support mobility, delivery of goods to market and improve economic well being.
- Need for strong public institutions that support industrial development - For Kenya to become a globally competitive economy, it needs an efficient, world class public service that is results driven. The incoming government must prioritise reform of public institutions, rationalising agencies, merging those with similar function, streamlining them for increased efficiency and efficacy.
- Mobilise resources for industrial investment - The incoming government must incentivise and support industrial investment through policy and, in specific circumstances, through financial and fiscal support.
- Ensure the implementation of the Constitution - Kenya’s rich and complex constitution needs to be implemented with care and keen oversight by the government, with vigilance regarding the people to ensure proper delivery. Any emerging challenges must be tackled expeditiously.
- Work towards water security and environmental conservation - The availability of sustainable water and other natural resources will determine the competitive advantage that Kenya will have over other investment destinations in the region and world over. The incoming government must demonstrate commitment to conservation of water towers, modernisation of urban water systems and sustainable water use for both commercial and residential needs.
- Set aside dedicated land banks for industrial investors in key towns and locations - Access to land remains one of the gravest hindrances to new investment in industry and it is critical for counties and national government to build land banks for industrial investment.
- Support innovation and technology development - ICT plays a key role in supporting efficient trading and production processes in the world today. The current slow implementation of E-government presents a challenge and creates a disconnect between noble policy objectives and business processes in both the public and private sector, as well as academia.
- Improve links between education and market - Higher education is critical for sustained growth in Kenya, improving productivity by providing the skills – technical, thinking and behavioural – required by the market, driving innovation and growth in the economy. The education system should be developed in a manner that ensures that students are able to put classroom theory into practice and even become entrepreneurs.
- Reduce corruption in business - Corruption undermines governance, democracy and the rule of law, intensifying injustice and conflict. It destroys investor confidence, raising the costs of doing business, driving investors and employers away and reduces economic growth. Business desires a more ethical business environment.