Why local content is the answer to our economic downturn

By Phyllis Wakiaga,

Our clarion call as local manufacturers on the importance of promoting local content to our country’s future has received yet another boost from the Government’s recent directive on making Casual Friday’s,  Made In Kenya Fridays.

As the largest procurement entity in the economy, Government has demonstrated leadership by implementing the local content policy with this move, therefore, promoting not only textile and apparel manufacturers but the whole fashion industry in Kenya – including microbusinesses such as seamstresses and tailors. The Public Procurement and Asset Disposal Act, 2015 states that sustainable development and the promotion of citizen contractors should be the cardinal values and principles guiding the procurement of State organs, and the Made In Kenya directive on clothing espouses this spirit entirely.

This announcement elicited a heated discourse among diverse groups, with many asking ‘What is a Kenyan look’ or ‘What kind of attire defines the Kenyan Culture or Spirit?’ And though the answer to these questions lie in a much deeper and long-term conversation, the fact that these questions came up, points to a dire need for self-realization through our very own creations as a country.  More importantly, it points to the fact that if we do not invest and take pride in our own creations and productions, the question of what represents our identity, as a nation, is one that we will always grapple with.

There exists instruments to support the production and consumption of locally produced goods in National Policies and Strategies. But as citizens, we must be deliberate about the consumption of our locally made products for the sake of our country’s present and future economic sustainability. The thinking that something is not of quality because it is made locally is simplistic and obsolete.  Kenya is not a master at making all things but we are definitely outstanding in some products, and perfecting the making of these things, is what will strengthen our position in the global markets as a force to reckon with.

I say this because it is not just in clothing that the Government has reinvigorated the procurement of local content, sectors such as Pharmaceutical and Automotives are also experiencing this positive wave from Government. It is a great thing when a country believes in itself enough to create its own solutions and consume its own products. It not only triggers robust economic growth presently but also our ability to absorb and adopt technologies from other countries and use them to make our products even better as we grow.

This is one of the ways in which Singapore’s economy grew. Singapore, whose largest industry by far is the manufacturing sector, which contributes 20%-25% of the country’s annual GDP, diversified their strategy of promoting local content. According to a report on Innovation and Government intervention, Singapore developed policies to encourage foreign investment to facilitate technology transfer and diffusion to local enterprises, in the 1980s – 1990s. Thereafter, the government started a series of plans to promote high tech entrepreneurship, which boosted the innovation capabilities of local firms. Eventually, highly innovative and standardized goods were being produced by the local industries. This meant better access to larger markets, reduced imports and growth of exports.

Consuming our local products as nation instills in all of us a sense of ownership in the making our economy. We become invested in seeing better raw materials grown so we enable our farmers to do so; we become invested in expanding local markets so we build infrastructure and develop regulation to support that; we become intentional about strengthening our value chains and new streams of income are formed, small businesses are made profitable and jobs increase.

The Government through its actions has led the way in this journey and there is need for us as citizens, communities, private sector to follow suit. It is imperative, especially during these hard economic times that we look to our own strengths first to propel us forward into a stronger economic future.

The Writer is the CEO of Kenya Association of Manufacturers and the UN Global Compact Representative for Kenya. She can be reached at ceo@kam.co.ke.