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Government will only buy locally-assembled vehicles
for official administration to help boost production

NAIROBI (Xinhua) -- The Kenyan government will only buy locally-assembled vehicles for official administration use in order to promote home-grown manufacturing, an official said on Wednesday.

Peter Munya, cabinet secretary in the Ministry of Industry, Trade and Cooperatives, said it’s now a government procedure for all ministries and other state agencies to buy locally- assembled cars to help create jobs for the locals and boost production.

"The directive must be adhered to as an assertion to supporting the local initiative and any state officer who violates the order shall have disciplinary action meted upon them," Munya said during the commissioning of new assembly lines at Isuzu East Africa assembly plant that was constructed at a cost of 1 billion shillings (10 million U.S. dollars).

He said all government agencies are thus required to give exclusive preference in procurement of motor vehicles for government use to firms that have assembly plants in Kenya as a way of spurring growth of local support enterprises and creating employment opportunities for the youth.


Kenya to pursue export-led economic growth to boost forex earnings

NAIROBI (Xinhua) -- Kenya plans to pursue an export-led economic growth model in order to boost foreign exchange earnings, a senior government official said on Wednesday.

Peter Munya, cabinet secretary of the Ministry of Industry, Trade and Cooperatives, told journalists in Nairobi that Kenya is keen to reverse the trend of a growing trade deficit.

"The country has laid down an export strategy whose implementation is currently being fast-tracked to ensure exports growth is faster than imports with a view to bridge the trade deficit," Munya said.

Government data indicated that Kenya’s exports grew from 594 billion Kenyan shillings (about 5.94 billion U.S. dollars) in 2017 to 6.13 billion dollars in 2018 while imports hit around 17.6 billion dollars last year.

Munya said that a strong export performance will require vibrant local industries that can produce goods competitively.

"We have also rolled out a number of fiscal incentives to catalyze the expansion of the manufacturing sector," he added.

Munya said that tea, horticulture, articles of apparel and clothing accessories, coffee, titanium ores and concentrates accounted for about 62 percent of merchandise exports last year.

"This is one of the reasons why Kenya is focusing on diversifying export products with a view to increase foreign exchange, wealth and job creation in the country," he added.

"Due to the complex dynamics of international trade, it will be difficult to achieve a trade surplus," Munya said.

The ministry of trade also plans to purse country-specific strategies in growing volumes and value of exports.

"We hope to leverage on the bilateral and multilateral trade agreements we have signed around the world to ensure we boost our exports," Munya said.

He said that Kenya will concentrate on enhancing exports to the African continent, which in 2018 absorbed about 35 percent of all of Kenya outbound merchandise trade.

Among the top 25 Kenya exports destination countries, ten are from Africa, including Uganda, Egypt, Rwanda, Sudan, Tanzania, Munya said.

He noted that Kenya has a competitive advantage in the manufacture of goods as compared to many other African countries.

"Kenya will grow its exports through region-specific interventions such as Kenya’s push for the realization of the African Continental Free Trade Area (AfCFTA) that guarantees Kenya a market opportunity of about 1.3 billion people," he added.

He revealed that ongoing efforts to improve Africa’s infrastructure connectivity will also enhance Kenya’s trade with the Africa by reducing the cost of cross-border trade and logistics.

Kenya Commodity Exchange to be operational in early 2020

NAIROBI (Xinhua) -- Kenya’s commodity exchange will be operational in early 2020, a senior government official said on Wednesday.

Peter Munya, cabinet secretary in the Ministry of Industry, Trade and Cooperatives told journalists in Nairobi that the regulations for the commodity exchange have already been developed to guide the operations of the platform.

"Our target is for the first agricultural produce to begin trading at the Commodity Exchange in the next nine months," Munya said.

"Thereafter we hope to incorporate all major cash crops as well as minerals in the commodity exchange," he added.

The government official said that the funds to implement the commodity exchange will be put in the national budget of the next financial year that begins in July.

Munya said that Kenya is prioritizing the exchange because of the positive impact it will have on the agricultural sector.

"It will allow farmers to receive fair returns on their crops by enabling a transparent mechanism for price discovery," he said.

COMESA trade experts meet in Kenya on industrial disparities

NAIROBI (Xinhua) -- Trade experts from the Common Market for Eastern and Southern Africa (COMESA) are meeting in Nairobi this week to discuss ways to address industrial disparities in the region.

The experts said the implementation of the COMESA Industrial Policy, which was adopted by COMESA Council of Ministers in 2015, is expected to provide the pathway towards addressing the growth gaps that exist on the supply-side such as low-value addition, low employment rates and weak cross-border trade volumes.

Betty Maina, Principal Secretary in charge of industry at Kenya’s Ministry of Industry, Trade and Cooperatives who opened the meeting late on Tuesday said a robust GDP growth of near 6.5 percent in the region has not led to economic transformation.

Maina said this disparity has resulted from preoccupation with low value-added products and trading in primary products and natural resources.

"Despite regional integration being of special importance in Africa, COMESA member states still trade more than 90 percent with other parts of the world due to lack of industrial diversification and products’ complementarity among themselves," said Maina.

Maina said the affected products are mainly those with few forward and backward linkages to the rest of the economy.

The three-day meeting will thus discuss the draft action plan of the implementation on the COMESA Industrial Policy and review the COMESA regional guidelines on the local content policy.

"The low level of intra-COMESA trade, which has not broken the 10 percent threshold of total exports over the years, is a reflection of a low level of industrialization," she said.

Kipyego Cheluget, assistant secretary general of COMESA, said energy costs in the region was a major impediment to the expansion of the manufacturing sector.

Cheluget said the total installed capacity for electric power in the 21 COMESA countries is about 90,800 megawatts compared to Brazil with over 150,000 megawatts.

"We are however beginning to see significant improvements in the generation capacity with the expected coming on-stream major power generation projects in Egypt, Ethiopia, Kenya, Uganda, Zambia," he said.

He added that the construction of Zambia-Tanzania-Kenya interconnector and the Ethiopia-Kenya interconnector will facilitate power trade between the southern and the northern power pools.


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