Smiles as Kenya textile, leather sectors get Sh3 billion boost

NAIROBI, KENYA: Farmers and traders in the cotton and leather industries could see improved fortunes in future if a plan mooted by the Government succeeds. The two suffered a beating when the industry was liberalised allowing the market to flood with cheap imports. Now, the Government plans to rejuvenate the sectors to create thousands of jobs, especially in the textile industry, which is currently on its knees.  

National Treasury Cabinet Secretary Henry Rotich when reading the 2014/15 Budget on Thursday said the Government is addressing challenges affecting the textile industry by spearheading a raft of new measures aimed at improving production and attracting new investments.

“In order to create jobs, the Government has committed Sh3 billion for the development of textile and leather sectors,” said Mr Rotich.  

The textile and leather sectors, he added, have potential to create close to 800,000 jobs in the next the years. “We must take advantage of the global market through African Growth Opportunity Act (AGOA) to aggressively grow the textile sector,” he added. Key on the list of measures being pursued includes enhancing value addition. Both sectors have been hit by the influx of second hand clothes and shoes.

The strategies are contained in the comprehensive Industrialisation Master Plan, launched last year by Industrialisation and Enterprises Development Cabinet Secretary Adan Mohamed.

According to the Economic Survey 2014, export value of articles of apparel increased by 7.5 per cent to Sh23.9 billion in 2013 compared to Sh22.3 billion in 2012.  The Cotton sector is currently producing about 10,000 metric tonnes though far below its potential of 40,000 metric tonnes.

COLLAPSE OF GINNERIES

Cotton Development Authority (CODA) Acting CEO Anthony Mureithi says the Government is committed to restore glory in the cotton industry. 

 Mureithi observed that, in 1970s and 80s, Kenya was the leading producer of lint in the region as well as the second leading employer after the public service in Kenya. 

“The industry will benefit from financial and technical assistance to the tune of Sh70 million from various development partners,” said Mr Mureithi.

The donors include Common Fund for Commodities (CFC), an autonomous intergovernmental financial institution established within the framework of the United Nations and Brazilian Cooperation Agency.  Others include Farmers Support Programme and Solidad of France that have extended Sh36 million to finance production, reduction of cost of production and protection of environment for the next two years.

The cotton industry collapsed between late 1980s and 90s after the liberalisation of the agriculture sector following introduction of the Structural Adjustment Programmes (SAPs) by the Bretton wood institutions –World Bank and International Monetary Fund (IMF). This led to the collapse of most operational ginneries. Currently, there are only eight operational ginneries in the country out of an establishment of 22 factories. They include Makueni, Kitui, Voi, Meru, Malindi, Mpeketoni, Salawa and Nyanza ginnery.

Also, the industrialization master plan further highlights plans to reinvigorate the local leather industry.  Mohamed says the national government in conjunction with county governments will work together to implement growth measures. Annually, the industry generates about Sh6 billion.

Speaking during a familiarisation tour of the Bata Shoe Factory in Limuru in Kiambu County, Mohamed, said the Government will provide support for local value adding factories to promote local leather processing industries. The local leather industry, Mohamed disclosed, has the capacity to contribute about Sh54.8 billion ($630 million) of the Gross Domestic Product (GDP).