A global cloth manufacturer has confirmed it will begin operations early next year, a move that could boost the Government’s job-creation plan.
Mas Holdings Singapore, a Sri Lankan apparel and textile manufacturer, is expected to create 3,000 job opportunities once it starts operation in Athi River, Machakos County.
Another textile manufacturer Royal Garments Industries, operating under the Export Processing Zones (EPZ), will also employ 2,600 more employees, according to the Export Processing Zone Authority (EPZA) Chairman Paul Gicheru.
Mr Gicheru noted that Mas Group will be opened together with two other companies with an average of 600 people, pushing up the number of employees employed in the EPZ by over 5,000.
This comes at a time when the country is grappling with job cuts as companies move to align their operations with a changing economic landscape.
With an investment of Sh1.5 billion, Mas Holdings Singapore will leapfrog Hela Clothing as the largest apparel and textile manufacturer in the country.
Hela employs 1,500 workers. The Sri Lankan firm joins the majority of companies operating under the preferential terms of EPZ that produce garments for export.
Mas Holding will export apparel products to the US, the United Kingdom, and the Netherlands.
Official figures show that the number of local employees engaged by EPZ enterprises increased by four per cent to 56,945 last year from 55,486 in 2017.
Mas Holdings with presence in 16 countries is expected to increase local value from $978,000 (Sh97 million) in the first year to $9.24 million (Sh924 million) in the third year of operation.
Although it lags behind agro-processing in terms of firms, textile and apparel firms under the EPZ employ more Kenyans, contributing almost 80 per cent of the export earnings.
One of the most lucrative markets for Kenya’s garments is the US. Through the African Growth and Opportunity Act (Agoa), Kenya has been able to export most of its textiles.
Agoa was approved by the US Congress in May 2000 to assist the economies of sub-Saharan Africa and to improve economic relations between the US and the region.
In 2018, EPZ companies exported goods worth Sh72 billion, a good chunk of which was textiles.
The value of the exports under Agoa increased significantly by 25.8 per cent from Sh33.1 billion in 2017 to Sh41.6 billion last year, official data shows.
“We have not been meeting our target with Agoa. Do you know that most nurses in the US wear work garments made in Kenya?” posed Gicheru
Although Petroleum products have continued to account for the largest portion of Agoa exports to the US from Africa, clothes such as those worn by US nurses have not.
“The volume of Agoa trade remains modest. In the Agoa clothing sector, for example, we get about $1 billion (Sh100 billion) per year from Africa,” Constance Hamilton, assistant US trade representative for Africa, told the 18th Agoa Forum that ended in the Ivory Coast’s economic capital Abidjan last Tuesday.
This amounted to only one per cent of all US clothing imports.
President Uhuru Kenyatta has earmarked textile and apparel as one of the sectors that will drive his plan to create jobs in the manufacturing sector.
The President expects to create over 500,000 cotton jobs and another 100,000 new apparel jobs.
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