The Big Four Agenda faces significant challenges as manufacturing competitiveness and corruption risks undermine efforts to achieve economic transformation, according to industry leaders.
Competitiveness Crisis ¶
Kenya Association of Manufacturers (KAM) Chairman Sachen Gudka warned that the government's flagship agenda could fail without urgent action on production costs and corruption. 'If we are not competitive in our manufacturing agenda, the pillars of the Big Four Agenda begin to crumble,' he stated during the launch of the manufacturer’s Super Sale festival at Kasarani stadium.
KAM has invested Sh100 million to promote local consumption of Kenyan-made products, aiming to boost the sector's contribution to GDP. However, the manufacturing sector's share of GDP has declined from 11.8% to 8.4% since 2014, far below the 15% target set for 2022. This requires a compounded annual growth rate of 36%—a challenge exacerbated by logistical inefficiencies.
Logistical Burdens ¶
KAM CEO Phyllis Wakiaga highlighted that Kenya's logistics costs are 13-15% higher than global competitors. Key factors include the 3% Railway Development Fee, delays at Inland Container Depots, and inflated raw material prices. These issues place the country at a 15% disadvantage compared to regional peers.
Shippers Council of Eastern Africa data revealed importers incurred hundreds of millions in demurrage charges due to container delays at Mombasa. 'We must revise these costs to close the competitiveness gap,' Wakiaga emphasized.
Corruption Concerns ¶
Brand Kenya chairperson Linus Gitahi warned that rising corruption cases threaten the Big Four Agenda. KAM's efforts to combat illicit trade, including a 62% increase in the edible oils sector, have shown progress. However, historical issues persist: in 2014, 6,500 tonnes of substandard cooking oils entered the market without Kenya Bureau of Standards certification.
