Resilient manufacturing sector: Surest way to self-sufficiency

By Phyllis Wakiaga 

Every end marks a new beginning, something that each new year presents. Making new resolutions and goals or redefining the existing ones at both personal and organizational levels best demonstrates this. However, to achieve this effectively, we must truly reflect and understand the past year to grow in the upcoming year.

2020 dealt us a new phenomenon, something unprecedented that evolved rapidly from a health crisis to one that affected all aspects and sectors of our lives. 

COVID-19 shifted nations’ plans with many focusing on safeguarding the lives of their citizens despite the economic impact. The pandemic caused shocks on both supply and demand sides as countries restricted movement. This disrupted the global supply chain and, in turn, posed a challenge to industries seeking material inputs. Lack of these inputs resulted in decreased production and job losses. Consequently, this affected the demand for goods and services as consumers’ propensity to spend decreased.

One thing stood out – Kenyans’ resilience and zeal to support each other amid the tough times. 

The introduction of fiscal measures, by the government, to unlock cash flow increased the ability for citizens to access basic needs and provided the necessary buffer for businesses to continue operating in a crisis. Another noteworthy step was the setting up of a Business Emergency Response Team to spearhead the formulation of measures and emergency policies, to steer businesses and cushion the vulnerable, especially the small and micro-businesses.

On the other hand, Industry was keen to Keep Kenya Moving. Manufacturers repurposed their production lines to ensure essential goods did not run out. They also shifted their focus or ramped up production of essential goods. Despite the constrained business environment, local industries did not increase the cost of their goods, to support the country. The pandemic also drove us to innovate, in order to help the country, overcome the crisis. For example, Kenya Association of Manufacturers’ Automotive Sector developed the first-ever locally manufactured ventilator, dubbed PumuaIshi 3.0.

Citizens too continued to support the country through donations, in-kind contribution and financial support towards efforts to flatten the curve, which is truly laudable. 

The manufacturing sector in Kenya, for many years, has been an epitome of job provision. Increased adoption of innovations and strategies to ensure that there is a continuous supply of essential goods and PPEs demonstrated the strength of the sector to provide and sustain jobs.

This year presents us with a window to leverage the opportunities that the pandemic brought. Even so, we must be cognizant that coronavirus will still be a major factor, shaping our decisions and strategic goals.

Our focus now as a country should be overcoming COVID-19. Additionally, we must realize sustained economic recovery. Part of this is the need to create a resilient and sustainable manufacturing sector in the country that will ensure we are always self-sufficient.

Our strategy as a country should aim at growing local industry and creating more employment opportunities. Manufacturers’ innovations and inventions are a clear insight into their underutilized capacity. The government should continue to provide support to Industry and open up more possibilities for innovative products and services. The strategy should focus on mechanisms that support import substitution, growing exports and exploring new markets for local products.

The Manufacturing Resilience and Sustainability Policy Toolkit, by the Association of Manufacturers and KPMG, provides recommendations to aid the country’s economic and manufacturing sector’s recovery from the impact of COVID-19, as businesses navigate challenges caused by shocks arising from the virus. Key among them, nurturing nascent and emerging opportunities uncovered by the pandemic; adoption of a ‘do-no-harm’ principle by the government when developing policies; supporting Small and Medium Enterprises (SMEs) through affordable credit; increasing the resilience of the manufacturing sector through policy stability; and creating a fiscal space by rationalizing government expenditure through operationalization of the public investment management guidelines.

We hope to achieve this by working with the government, among other stakeholders, to develop policies that encourage investment in the sector.

The writer is the CEO of Kenya Association of Manufacturers and the UN Global Compact Network Kenya Board Chair. She can be reached at ceo@kam.co.ke.