Manufacturing sector posts impressive performance

By FREDRICK OBURA

The manufacturing sector fought off high production costs, taxes, poor infrastructure and cheap imports to post a 4.4 per cent growth last year against 1.3 per cent in 2009.

In the economic survey 2011, the value of manufacturing output rose by 11.9 per cent to 861.1 million in 2010 up from Sh769.6 million the previous year.

During the year under review, dairy and meat products, miscellaneous manufacturers, grain mill products and miscellaneous sub sectors registered impressive performance.

Production from food manufacturing sub-sector recorded a growth of 8.6 per cent in 2010 compared to a revised growth of 4.2 per cent registered in 2009. "This growth was mainly due to increased production of grain mill products and meat and milk products," says the report.

Production of transport equipment grew by 3.0 per cent after recording declines for two consecutive years. The growth was driven by the production of assembled vehicles, which rose by 13.9 per cent.

Tax measures

Increased production of paints, drugs in tablet form, shoe polish, and laundry soap pushed up the production of petroleum and other chemicals by 3.9 per cent. And production of clay and other products, sugar and confectionery, electrical machinery, paper and paper products, printing and publishing and rubber products declined.

The production of sugar and confectionery products dropped by 4.3 per cent in 2010, as a result of a 4.4 per cent decline in sugar production. Manufacturing sector benefited from rains experienced early last year, which led to an increase in raw materials and reliable power supply.

The Government’s favourable tax measures strengthened the sector.