NAIROBI, KENYA: Cotton growers, textile manufacturers and steel makers could turn out to be some of the biggest beneficiaries of this year’s budget.
But there are caveats.
First, the county governments will have to assist farmers with inputs, training and developing linkages with cooking oil processors and textile firms to guarantee markets and prices.
Secondly, the relevant State agencies, including Kenya Revenue Authority and Kenya Bureau of Standards must up their game to ensure correct duties are paid and only goods that meet the set standards are imported.
Thirdly, Government’s procurement department must embrace the ‘Buy Kenya Build Kenya’ mantra. This applies to those who buy uniforms for the various State departments, including hospitals.
Parents should also buy school uniforms only from firms that get their supplies from local manufacturers.
Factory owners at the export processing zones need to be given incentives to buy their cloth locally even in instances where supplies from other countries may be cheaper.
In the event that some pull out of the country, the Government should take over the factories and keep the sewing machines humming because the US market is assured under the Africa Growth Opportunity Agreement (Agoa).
Manufacturers of cooking oil and animal feeds should also be encouragement to use the locally sourced raw materials.
Fourth, local manufacturers of iron and steel products are also set to be among the biggest beneficiaries following the slapping of a 35 per cent duty on imports.
Missed an opportunity
With the benefit of hindsight, Kenya may have missed an opportunity to expand the manufacturing sector by failing to demand that the Standard Gauge Railway contractors buy iron and steellocally.
An admission that Kenya missed an opportunity to become a key iron and steel producer will open the door for discussions between industry players.
After all, there are other phases of the SGR construction to consider. Who knows?
A government that is serious about expanding the sector might find the right incentives to coax Uganda into importing iron and steel for the construction of its own SGR and for building of residential houses.