Presidential Roundtable adopts Proposed ‘Quick Wins’ in Manufacturing

Industry Optimistic on Short-term Plans to Reduce Hurdles in the Business Environment

Saturday 28, May 2016 Nairobi, Kenya: Kenya Association of Manufacturers presented the leading challenges for local businesses to H.E Uhuru Kenyatta on Thursday at the Presidential Roundtable meeting organized under KEPSA. Among the issues ailing the manufacturing sector that were stated include, Access to markets –both regional and international, non-predictive regulatory environment, delayed payments to SMEs and manufacturers, County Business Fees and charges, Overlapping regulations and taxes that weaken the competitiveness of local products.

Of the issues tabled, the government led by His Excellency The President adopted a substantial number of the proposed solutions by the industry leaders present including KAM CEO Ms. Phyllis Wakiaga. The endorsed recommendations specific to manufacturing were as follows:

• On local content (Buy Kenya Build Kenya Policy)- that the overarching Local Content Policy (under the auspices of Buy Kenya-Build Kenya) should be approved by Cabinet, the Preference and Reservations Regulations being developed should embed local content and that Performance Contracts should monitor and report on local content uptake.
• On VAT Refunds – that the outstanding amounts will be budget for and paid within 1st Quarter in new financial year. Further, to avoid delays treasury should include VAT refunds in the budget and have monthly allocations set aside for payments. Moving forward, it was agreed that government in consultation with industry would develop a framework on the days for repayment, matters of reciprocal interest, risk based reimbursement to avoid delays in future.

Reacting to the expected impact of this meeting, KAM Chief Executive Officer Phyllis Wakiaga said, “For many businesses the adoption of this proposals is really a breakthrough and very encouraging. The business environment, as we have said before, has been rendered quite uncompetitive by some of the regulations and policies that have been put in place making the cost of doing business in Kenya quite high. So this goodwill from government is quite welcome and a big leap in our vision for industrialization in order to meet our vision 2030 goals as a country.”

Other issues taken up were prompt payment issues in order to protect local businesses and reduce the cost of doing business that is brought on by delayed payments. The recommendations in easing inter-county trade were also adopted with the immediate actions being that the AG would gazette the Transitional Authority advisory TA/8/48/VOL/.iii (3) of Dec, 2015 and that Parliament would review the County Statutory Instrument Bill 2015. The recommendations on the Railway Development Levy and Import Declaration Fee on raw materials and industrial inputs will be taken up urgently for review.

The Government has also committed to fast tracking the Economic Partnership Agreement and has set a working deadline for October 2016.