Jua Kali artisans seek survival in supply tenders to fight virus
By Peter Theuri | April 5th 2020
What would a total lockdown, if it happens, do to that Kenyan who has to go to work early every morning to feed their family every evening?
This is what the country’s Jua Kali industry is staring at, coupled with the 7:00pm to 5:00am curfew already denting business further after the novel coronavirus lashed the first debilitating blow.
Artisans hope the curfew is not a precursor of total lockdown, which would deal a death blow to them plus millions of Kenyans who already depend on them.
The country has over 17.5 million people employed in Micro, Small & Medium Enterprises (MSMEs) according to the Kenya National Federation of Jua Kali Associations.
This accounts for well over 83 per cent of the entire workforce - most of who operate under one mantra: he who does not work does not eat. So, and they have a choice?
They have to work every minute to put food on the table, their next meal only dependent on their every minute’s sweat.
Even before the Covid-19 tore across the globe and crippled most industries, the Jua Kali sector was suffering.
Low liquidity in the economy, meant low sales, affected them for the longest time towards the end of 2019 and the start of 2020.
The industry was still grappling with challenges of obtaining lending from financial institutions, which has so far proven a slippery venture.
And as the country came to terms with the fact that stringent measures had to be taken to contain the Covid-19 pandemic, President Uhuru Kenyatta announced a night-time curfew.
Alongside the curfew, the president announced a raft of measures aimed at salvaging a floundering economy as well as saving Kenyans from the disease’s scourge.
Among the measures were tax relief options which are mainly seen to target low-income earners and cuts in Pay as You Earn (PAYE), value-added tax (VAT), turnover tax (ToT) and corporate tax.
Those earning a gross salary of up to Sh24,000 a month, for example, will be granted full tax relief on PAYE starting this month.
But the relief will only last for four months, which the government hopes the pandemic will have by then subsided.
Other employees will, however, benefit from a reduction in PAYE from 30 per cent to 25 per cent. The president also instructed Treasury Cabinet Secretary Ukur Yatani to come up with a mini-budget that will see the levy on corporations’ profits - corporate tax - go down by a similar margin.
But Kenya National Federation of Jua Kali Associations (KNFJKA) CEO Richard Muteti believes that the fiscal adjustments will not necessarily save a sinking Jua Kali vessel.
“The regulations put into place are good, but they target people in the semi-formal sector. The only recommendation that resonates with the Jua Kali sector is the non-listing with the Credit Reference Bureaus,” says Muteti.
His statement is about a directive by the president to allow advancement of credit to people previously listed in the CRB, and also to cushion those who will default by April 1 from being listed.
The move to suspend listing and to offer credit will mainly save small borrowers, most of them who have been thrown under the bus for defaulting on quick, short-term mobile loans that attract hefty interest rates.
The lending for the Jua Kali sector has been reliant on these mobile lenders who rake in huge profit margins in short moments.
Most of the Jua Kali artisans are unable to get credit from banks and thus obtaining raw materials on credit from suppliers, with the agreement to pay later and in installments.
This purely depends on the utmost trust between the parties. And now, here they are, some with hefty stocks of raw materials but with no one to buy their manufactured goods.
This translates to lack of money to pay for the materials sourced from suppliers amid pressure from impatient, equally cash-strapped suppliers.
Other small-scale manufacturers are short of raw materials as local and international markets face an indefinite slowdown.
As people honour social distancing directive and stay home, it means the Jua Kali people have no markets to trade off their wares in.
This, coupled with a depressed economy where generally money was not flowing points to a possible total crumble of the industry.
But Muteti insists they have to keep going, with any effort to completely close the markets translating to the starvation of millions of Kenyans who depend on daily wages to eat.
Recently, Muteti visited Kamukunji Market in the company of Ministry of Health officials to demonstrate to the artisans on how to maintain basic sanitation.
There, they demonstrated handwashing with soap and running water, social distancing and basic respiratory hygiene. This was then to be shared in other markets in other parts of the country.
But even amid the pandemic, the sector is hatching opportunities, with a directive to the primary associations of the KNFJKA to innovate, and now, they are manufacturing their amenities such as soaps and water barrels with taps on site.
“We are partnering with plastic manufacturers so that we can provide metal fabricated stands that will be used for handwashing. We have made a prototype in which, to avoid a lot of contact with the taps, people can step on a pedal that will open the taps while washing hands,” he said.
Also, the industry is making beds that will be used for care in hospitals.
The Jua Kali body has sent a memo to its associations appealing for them to liaise with counties to be an active part of, alongside county response teams, the battle to contain the scourge of Covid-19.
Trade and Industrialisation Cabinet Secretary Betty Maina, however, said the pandemic offers more opportunities to manufacturers, most of them in MSMEs, to come up with appliances that will supplement the available supplies to help in the fight against Covid-19.
“I would like to confirm that within Kenya, there are more than 50 companies that are capable of providing some of these medical inputs. We started obviously with things like sanitisers, and we have seen a large number coming into the market,” she said.
The CS observed that Kenya’s textile sector had confirmed it was able to make personal protective equipment (PPE), which include protective clothing such as helmets, goggles and other equipment designed to protect the wearer’s body from injurious exposures or infection.
The Jua Kali sector is seeking support in the supply of sanitisers, gloves and masks to their members. They also appeal for the suspension of interest rates on loans, suspension of auctioneers’ attachment on properties, and removal of taxes on essential services.
The government has also been asked to consider small business disaster loans and related aid packages.
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