Spotlight on manufacturing in Kenya
As Vision 2030 approaches, we shine a light on the current state of one of Kenya’s key industries
Screenwriter: Phoebe Harper | Project Manager: Lloyd Hanley
In maintaining a competitive and industrialized economy, Kenya’s manufacturing sector plays a vital role. As an industrial powerhouse, the country’s manufacturing sector contributes an average of around 10% to the national GDP each year and, as a key channel for local job creation, it is responsible for sustaining national production and exports. . Agribusiness, automotive components, garments and textiles, and electronics are just a few of the major segments that contribute to Kenya’s manufacturing prowess.
Over the past two decades, the progress of the sector has accelerated through the establishment of Special Economic Zones (SEZs), industrial parks and various clusters. All this comes with a relatively reliable infrastructure, a strong private sector and a robust workforce. The development of the East African Community (EAC) Customs Union has been instrumental in expanding trade opportunities in the sector to harness and boost intra-regional trade.
Under Kenya’s Vision 2030, the Big Four Agenda and Kenya’s Industrial Transformation Agenda, commitments have been made to increase the sector’s contribution to GDP to 15% this year, by revitalizing strategic manufacturing segments, including textiles and agro-industry.
With progress well underway, we are catching up with the industry association that champions sector cohesion by defending the best interests of all major players.
Interview: Kenya Manufacturers Association (KAM)
To keep Kenya competitive, we speak with Mucai Kunyiha, President of KAM, as the association continues to advocate for a thriving manufacturing sector
Africa Outlook (AO): Can you tell us about the origins of KAM – how it came about and its initial vision?
Mucai Kunyiha, Chairman (MK): The Kenya Association of Manufacturers (KAM) is the representative body for manufacturing and value-added industries in Kenya. Founded in 1959, we have evolved into a vibrant, dynamic, credible and respected trade association that unites industrialists and provides a common voice for business.
• The Association is committed to making a difference in Kenya, ensuring the socio-economic well-being of Kenyans, and therefore, reducing inequalities within the community. We do this through our Environmental, Social and Governance (ESG) arm – uKAMilifu.
• uKAMilifu is a Swahili word meaning complete/wholeness. It’s an ideology that talks about creating holistic solutions together. uKAMilifu seeks to amplify and implement the human impact initiatives that local industry has been a part of over the past 62 years of KAM’s existence.
MK: Since our inception, we have taken important steps as an association.
Through our advocacy, we hope to increase the sector’s contribution to Kenya’s GDP and thereby accelerate the creation of jobs and wealth for all. We also want to intensify our exports to regional and international markets.
MK: Kenya’s manufacturing sector is constantly transforming, adapting to emerging trends. This has allowed us to stay ahead of our regional counterparts, especially in the EAC.
AO: On the other hand, what are his biggest challenges?
MK: Although we have made significant progress in growing our manufacturing sector, we continue to face challenges that affect our competitiveness and productivity. Without these two elements, the local manufacturing sector will not be able to venture into local and export markets.
Competitiveness involves a country’s ability to produce goods and services that meet international standards while simultaneously maintaining and increasing the incomes of its people over the long term. On the other hand, increased productivity ensures efficient use of the resources available to the economy, such as labor, capital, and business expertise, to produce goods and services.
AO: What trends are currently transforming the industry in your region? How do you respond to them?
MK: The post-COVID-19 world is going to be even more competitive. Just like Kenya, many countries have identified huge investment opportunities for their regional and international markets. Nurturing the nascent and emerging business opportunities uncovered by the COVID-19 pandemic will be essential in this new world. We have identified 76 opportunities to invest and add value through our Manufacturing Resilience and Sustainability Strategy: An In-Depth Industry Report.
MK: Currently, we are focusing on expanding our export capacity. This is particularly crucial now, to enable us to take advantage of the opportunities presented by various trade agreements, such as the Economic Partnership Agreement (EPA) between Kenya and the UK, the African Continental Free Trade Area (AfCFTA ) and trade with the European Union (EU). .
AO: How do you see KAM evolving as an association in the next five years?
MK: Over the next five years, I hope to see KAM present in every corner of Kenya, representing manufacturers from every county. I also aspire to have a manufacturing sector that competes on an equal footing with highly industrialized countries.