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Jacktone Ahawo, a Jua kali artisan chisels a metal sheet to make a frying pot at Kibuye market in Kisumu.

Business News
The unsavoury conditions most Jua Kali people work under do little to better their production and productivity.

From the spoon you use to that beautiful carving that adorns your mantelpiece, the Jua Kali industry has been part of you for years. Maybe, to say that you have been part of it is more appropriate.

Kenya National Federation of Jua Kali Associations (KNFJKA) Chief Executive Officer Richard Muteti, jokingly says while other industries are busy retrenching, the Jua Kali sector is constantly recruiting.

KNFJKA, formed in 1992, has been growing. It was created as a home for artisans before most Kenyans inadvertently decided that it was a sector for those who had not succeeded in other facets of life. Muteti refutes this claim, insisting that the industry boasts a number of highly educated individuals.

“This sector is growing at a rate of 10 per cent per annum. We have incorporated both very skilled and unskilled people in the industry and we are making admirable progress,” said Muteti during the 28th Economic Symposium of the Institute of Certified Public Accountants of Kenya (ICPAK) event last month.

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The Chief Executive Officer Micro and Small Enterprises Authority, Henry Rithaa, says in 2017, 3 per cent of the total 6.4 percent GDP growth could be attributed to Micro, Small and Medium Entreprises (MSMEs), in which Jua Kali is a major player. There is no denying that the industry, which contributes to over 90 per cent of jobs in Kenya, is massively important to economic growth. 

And yet dealers in the trade continue to wallow in misery.

Loan default

Among the issues they encounter, according to Muteti, is lack of affordable credit. Most of these people require startup capital, often coming from underprivileged backgrounds or situations that peg them into penury. However, there is no one to help them out. Banks issue loans against collateral, and most of these people have nothing the bank could hold onto as security. Fearing their clients might default, lenders flee.

According to the Kenya Association of Manufacturers CEO Phyllis Wakiaga, over 96 per cent of loans extended to manufacturers come from private lenders, with the government still coy to fund the industry. But even from the private lenders, the money is hard to come by.

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And here is where the shylock slides in, smiling to the last tooth.

With exorbitant interest rates charged, shylocks are willing to take goods of little worth from debtors in order for them to advance loans.

The artisans also suffer high taxation, which further muffles the industry, he says. The introduction of the turnover tax will further cripple a sector that teeters under the weight of many more limitations, and he makes a plea to the government to revise the taxation model for them.

Raw materials aside, the general quality that can be expected from Jua Kali sometimes underwhelms. Muteti claims that some of the industry’s products, compared to imports of the same kind, are of low quality, because the procedures used to manufacture differ sharply.

Credit guarantee

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A sophisticated lab in which spoons are minted, somewhere in China, with high-end technology, would not produce the same results as a roadside blacksmith shack on a roadside in Dandora. Muteti believes that standards of products need to be set and while at it, methods of production enhanced to reach those standards.

As such, he appeals to the government to give more input into the skilling of the sector.

The government is also urged to provide a credit guarantee scheme that will help the artisans to obtain cheap credit.

From itinerant traders who run after cars on the streets to sell their wares, risking their lives in the process, to shoe shiners who have to bear harsh weather in rainy seasons to appear on verandahs and roadsides to clean murk off shoes, to blacksmiths in Kamukunji who ply their trade next to heaps of garbage and places that turn into soggy cowsheds in the rainy seasons, most of people in the industry suffer to produce.

After all the trouble, some of the wares still don’t find market. Rithaa says the government, through initiatives such as Vision 2030, the Big 4 Agenda (which bids to employ Kenyans to fulfil and sustain the four pillars of affordable housing, affordable healthcare, manufacturing and food security) and the Buy Kenya Build Kenya campaign, is working hard to ensure markets for MSMEs will be improved.

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“I appeal to the government to buy at least 30 percent of our products,” says Muteti. “Let them promote us.”

It remains to be seen whether the 90 per cent of the total workers in the Jua Kali industry who are unregistered will get into the roll of the tax collector. Kenya Revenue Authority has developed an app called M-Service that will help the small taxpayers remit their taxes easily.

“A lot of people want to pay tax but they don’t know how to. Now they have a way to,” says Caxton Ngeywo, KRA Deputy Commissioner for Policy and Tax Advisory Division.


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