April 15, 2015, NAIROBI: Kenya Association of Manufacturers (KAM) will host EAC Manufacturers Association Chairmen, Board and CEOs on April 16 – 17, 2015 to officially launch the EAC Manufacturers Network, Ms Betty Maina, KAM Outgoing CEO has said.
The dialogue meeting is aimed at streamlining manufacturing issues and concerns within the EAC region while proposing solutions towards the same. The meeting also aims to get the buy-in of the Executives as well as provide guidance on some of the broad areas that the Network will need to focus on.
“In order to realize the potential of manufacturing sector in the EAC region, there is need to provide a systematic approach towards addressing the challenges that plague this sector. This can be done through a forum or a network of manufacturers in the EAC,” said Ms Maina. The network will provide thought leadership and coordination towards growing the manufacturing sector in the EAC region as well as drive industrialization agenda in the EAC.
The manufacturing sector in EAC is fairly small with Kenya having the largest number of manufacturing entities. On average, contribution by the manufacturing sector to the gross domestic product is estimated at 10 percent. While it is still a relatively low stage of development on average, there is enormous potential for this sector to develop.
A number of challenges hinder the growth and development of the sector. Notable among them is the high energy cost and lack of an efficient infrastructure system. It is however important to note that considerable effort has been made by the EAC governments to improve infrastructure facilities in order to facilitate the smooth flow of goods in the region. Other challenges affecting the sector include competition from cheap imports, use of old technology, high tax rates, overlapping regulation from numerous different authorities among others.
Developing and upgrading regional value chains is critical if the manufacturing sector is to grow. It is not enough to tackle trade facilitation and other regional integration issues on their own without giving due consideration to the other issues that affect competitiveness. “The EAC has developed the industrialization policy and strategy which is a good start. Efforts must now be concentrated on ensuring that implementation is done in the right manner,” she said.