industrial supply association by abe20

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									 PUBLIC/PRIVATE PARTNERSHIP:
Involvement of Kenyan Companies
      in Development Work
       & Economic Growth

            Betty Maina
           Chief Executive
  Kenya Association of Manufacturers
Outline of Presentation

Background: About KAM and its Services
About Industry in Kenya
Kenyan Industry in the Region
Kenya & Its Markets
A PPP Framework for Engagement



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     KENYA ASSOCIATION
     OF MANUFACTURERS

Kenya’s Representative for Industry…
     Background

KAM is Kenya’s leading representative for
Manufacturing Value Add industry
Formed in 1959 to act as a common voice for
manufacturers in East Africa
Creates an essential link for cooperation, dialogue
and understanding with the Government by
promoting investment, upholding standards, and
representing members’ views and concerns


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Background


Represents major players in MVA – 50%
Growth rate is 15% annually
Vision is to drive the Industrialization
Process in Kenya (and the region)
Mission is to promote competitive local
manufacturing in liberalized markets


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KAM Structure



                      AGM
                    Executive
                    committee
                   Secretariat

   Working          industrial       Regional
  Committees         sectors         Chapters


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Services offered by KAM

Policy Advocacy and representation to
Government on Issues that impact on
Business
Representation in regional and
international trade negotiations
Tax services
Educational/Learning events for member
Provision of Business information –
opportunities, linkages etc
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Services offered by KAM


Market Expansion and Export Facilitation
Training on Industrial Energy Conservation
Networks with other business Associations
Promotion of Kenyan industries




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         Some Facts on




Kenyan Industry in the Region
Some Facts about Industry in
Kenya

Contributes 10% of GDP –19% VA GDP
Employs >250,000 Kenyans (in formal
sector) (1.26m including public and
informal sector-81%)
Contributes >60% of Government
Revenue


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Some Facts about Industry in
Kenya

Make up 60% of Top Tax-Payers
Engagement with Society via CSR and
philanthropy
Kenyan Companies – Most Respected EA
companies - Celebrated and
acknowledged by PEERS


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Industrial Sectors


Largest Sector: - Food and Beverage
(18%)
Next: Leather products (11.7 %), metal
and allied (11.2 %), Textile and garments
(11%)
Other sectors: Timber& wood, plastics
and rubber, chemical and allied & Paper
and Board.
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Doing Business in Kenya

The costs of doing business is high due to:
 – Infrastructure – transport, electricity
 – Administration and regulations
 – Weak implementation of policy
 – Labour productivity
 – Protection of intellectual property rights and illicit
   trade
 – Non tariff barriers
Thankfully Focus of government action
presently
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Doing Business in Kenya


Rewards to Business comes from a focus
on the Regional market and expansion of
production into the region
Businesses hedge themselves by
diversification - additional product lines
or additional investment in region


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Kenya and it’s Markets


Founder Member of Customs Union in
East Africa – Market of >90mln people
 – 3 band CET (0, 10 and 25) + Sensitive list
Source of FDI in Tanzania, Uganda,
Rwanda
Founder Member of COMESA FTA >
400mln
 – Spearheading COMESA Customs Union
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Kenya and it’s Markets


Beneficiary of AGOA – First to qualify
 – -Exports of apparel and other products to US
   duty free and quota free – able to maintain
   market share in US after MFA lapsed in Jan
   2005
Member of ACP-EU partnership
 – Exports to Europe on preferential non
   reciprocal terms
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  East African Economy

Country Popn            GNP        GNP     Value added as % of GDP
        (mllns)         per        $ bln   Agr     Industry Service
                        capita                              s
Kenya      32.4         460        15.0    16      19       65
Uganda     25.9         270        6.9     32      21       47
Tanzania   36.6         330        11.6    45      16       39
Total      94.8                    33.3


Source: World Development Report - 2006
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        Main Imports to Kenya
                                1998      2000     2002      2003*
Food and beverages              9         8        6         5
Industrial supplies             34        27       32        31
Fuel and lubricants             16        26       18        24
Machinery & capital eqpmnt      18        16       13        14
Transport equipment             16        17       20        13
Consumer goods n.e.s            8         6        7         8
Goods n.e.s                     -         -        3         5
Total                           100       100      100       100
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     Main exports from Kenya

                                1998    2000     2002    2003*

Food and beverages             57        56     52        51
Industrial supplies            18        19     25        25
Fuel and lubricants            9         9      3         -
Machinery & capital eqpnmt     1         1      1         1
Transport equipment            1         1      1         1
Consumer goods n.e.s           14        15     18        19
Goods n.e.s                    -         -      1         2
                                           Our
Total Make Kenya a Global Winner: Enhance100 Competitiveness
                               100              100       100   19
         Destination of Exports
Descrpn          2000     (% of    2002      (% of     2003*     (% of
                          Trade              Trade)              Trade)
Total Europe 41,804       31       49,517    29        56,579    31
E. Union         40,029   30       46,628    28        52,159    28
Total            3,588    3        4,107     2         3,880     2
  America
Total Africa     61,935   46       82,750    49        84,653    46
COMESA           45,586   34       59,099    35        61,769    34
Total Asia       22,241   17       25,914    15        27,781    15
Grand Total 134,527 100            169,283 100         183,154   100
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A PPP Framework for Kenya

KAM recognizes the importance of Public /
Private sector partnership
Association partners with government in
addressing issues that will accelerate
economic growth & national development
Identifies opportunities for business
contribution
Constant dialogue and partnership with
Government
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A PPP Framework for Kenya

In February 2007 – KEPSA, FKE & KAM
partnered with UNDP to launch the
Compact for Nation Building &
Competitiveness with the Government;

The initiative facilitates local businesses to
embrace the 9 principles of UN Global
Compact
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A PPP Framework for Kenya

The initiative has registered a network of
Kenyan companies to VOLUNTARILY subscribe
to the 4 focus areas of the UN Global Compact

By signing up, businesses demonstrate
commitment to produce in an environmentally
sustainable manner and to embrace principles
pertaining to….

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Commitment focus areas


Environmental sustainability
Integrity & Governance
Human & labour rights
Wealth creation




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Commitment focus areas


Compact encourages businesses to
demonstrate compliance with burdensome
Government regulations that affect their
operations e.g. Occupational Health &
Safety, Environmental Compliance (NEMA
and EMCA) - even as we negotiate on the
spurious provisions

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Environmental Sustainability

KAM partners with NEMA to promote
industry’s compliance with environmental
regulations
KAM partners with Government to
promote Energy efficiency
KAM promotes Clean production among
members - through Technological
improvements
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Commitment focus areas


KAM assists members to implement
Energy Efficiency programme, Clean
Enterprise Programme, Kaizen initiatives
and Competitiveness enhancement
programmes that assist firms to embrace
these principles in their operations


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Commitment focus areas

Some businesses have invested in clean
technologies, Energy Efficiency, waste
reduction and re-afforestation

Results have been realised in energy
savings of up to Ksh 850ml in 2005 which
also saved the national grid up to 50MW
in 2005
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Wealth Creation focus


Businesses in this cluster demonstrate
Innovations that Change People’s Lives
e.g. Sustainable local Supply chains that
invest in empowering the Producer &
Growing Sustainable Business examples
e.g. Unilever Sauri Sourcing partnership,
Kevian GSB model

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Wealth Creation focus


Businesses are encouraged to create
linkages and opportunities for building
better local supply chains in order to spur
growth for self and other players e.g.
farmers & informal sector operators




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Labour rights


Investing in employee welfare e.g.
  Promoting compliance with OHS
  regulations
  Health - HIV/Aids workplace programs
  Housing programs- UN Habitat



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Integrity & Governance


Companies are urged to promote good
governance practices and a culture to
shun corruption

Compact encourages self-reporting on
progress made in embracing the UN-GC
principles within the firms

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Government Role


In response, Government is expected
to address factors that hinder
business growth i.e. infrastructure,
regulation, insecurity, taxation,
external trade facilitation, labour, IPR
protection, bribery & communication
of national image
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Final Remarks


Kenyan industry willing to link up and
work with external partners in expanding
local industry
Competitive and Enterprising
Can supply Humanitarian Agencies from
here


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                THANK YOU

     For more information:
LOCATION: Peponi Rd, Westlands, Off Mwanzi Road
  ADDRESS: PO Box 30225 – 00100, GPO, Nairobi


  Website: www.kam.co.ke
  E-mail: info@kam.co.ke

               THANK YOU
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