KAM has grown into a respected association that unites industries
By Boniface Otieno
Innovation, dynamism, credibility and respect are the traits of the Kenya Association of Manufacturers (KAM).
Established in 1959 as a private sector body by small group of businessmen who agreed to establish a vehicle to promote their interests under what was then known as the Association for Promotion of Industries in East Africa (APIEA), KAM has evolved to become a respected association that unites industries as well as providing a common voice for business.
“We provide an essential link for cooperation, dialogue and understanding with the government by representing the views and concerns of our members to relevant government agencies,” says Chief Executive Phyllis Osoro Wakiaga.
Wakiaga says as a policy advocacy, KAM has contributed immensely to the formulation and adoption of policies governing trade and investments. These include the contract law, VAT Act, Income Tax, Public Procurement and Disposal Act, Companies Act, land laws and labour laws.
She says KAM has helped Kenya’s manufacturing companies remain competitive in the global trading arena, transforming the economy by creating jobs and driving exports.
Towards this end, from 2009 to 2013, the sector’s contribution to Kenya’s rebased Gross Domestic Product (GDP) grew from 9.5 per cent to 11.3 per cent. The sector comprises of about 3,700 manufacturing units out of which 1,000 are KAM members. They had slightly about 800 members in the last two years.
Similarly, output from the manufacturing sector was valued at Ksh1.1 million in 2014, up from Ksh1.4 million in 2013, according to data from THE Kenya National Bureau of Statistics.
Consequently, overall exports in 2012 increased by 12.2 per cent to US$9.4 billion (23.2 per cent of GDP), up from US$8.4 billion (24.9 per cent of GDP). Of this, the African market was the largest destination of Kenya’s exports, taking up 48 per cent while 26 per cent were sold in the East African Community. The European Union is still Kenya’s second main trading partner and accounts for 24 per cent of exports, of which 7.8 per cent go to the United Kingdom.
Subsequently, the manufacturing sector employed over 280,300 people directly in 2013, up from 271,000 in 2012. The informal sector contributed further employment for 1.6 million people.
In pursuit of their core business mandate, Wakiaga says KAM has been offering a wide range of services in policy advocacy from all levels of services and business information to all their members.
Some of their interventions include conducting objective policy research to inform policy positions on issues affecting manufacturers, lobby government for favourable changes in policy and regulations, offering technical advisory services on taxation, trade and investment and access to market.
KAM also provides technical information on trade agreements under the EAC, COMESA, European Union Economic Agreement and World Trade Organisation, among others.
It also conducts seminars and workshops for members to improve efficiency and profitability.
Despite the turnaround and growth, like all other organisations, KAM faces a number of challenges including the high cost of power.
Wakiaga opines that the cost of power per unit of electricity in Kenya is high and volatile depending on the amount of thermal energy in the system, which is susceptible to changes in international oil prices.
“The current cost and quality of electricity is discouraging new investments and constraining expansion of industries. This is worsened by frequent power fluctuations and unscheduled interruptions and is a cause of lost time and equipment damage due to the low quality of power,” she says.
The association wants the government to subsidise the cost of electricity as it is the case in several countries, including China, whose products are flooding the Kenyan market.
Secondly, a number of Kenyans still do not want to consume locally manufactured products as they are of the mind-set that imported products are superior. As such, KAM is urging Kenyans, starting with government departments and ministries, to buy products manufactured locally, especially in the textiles industry.
Finally, the association believes there is need to streamline regulatory institutions to avoid duplication of roles in the two levels of government.
“Regulations become burdensome when they are many, difficult to administer and comply with and when similar regulations are administered by more than one agency,” says Wakiaga.
Going forward, Wakiaga says she is optimistic that the sector will be able to overcome some of the challenges and attract more members. She also hopes that in the next five years, KAM will be in a position to contribute between 15 to 20 per cent of GDP.
Wakiaga has been at the Head of Policy Research and Advocacy Unit at KAM since 2013. The unit provides the overall direction in the policy and advocacy work of the association. She has successfully led a partnership with the National Council on the Administration of Justice to develop the Enforcement Manual to Combat Illicit Trade in Kenya and with the Commission on Revenue Allocation on the County Money Bills Project. She represents KAM on the board of the Kenya Industrial Property Institute (KIPI) and is a member of the Kenya Consumer Protection Advisory Committee (KECOPAC).
Before she joined KAM, she was the Manager for Government and Industry Affairs at Kenya Airways where she was a key member of delegations negotiating bilateral air services agreements and was responsible for building and maintaining government and industry relations. She was a member of the East African Community Facilitation Team that ensured improvements across all airports in East Africa. She previously worked at Otieno Omuga and Ouma Advocates.
Currently, she is an advocate of the High Court of Kenya. She holds a Masters in Business Administration from Jomo Kenyatta University of Agriculture and Technology, Bachelor of Law Degree from the University of Nairobi, Diploma in Law from Kenya School of Law, and a Higher Diploma in Human Resource Management from the Institute of Human Resource Management Kenya. She also has a Masters in International Trade and Investment Law from the University of Nairobi.
To top it off, she is an alumni of the Swedish Institute Management programme on Sustainable Business Leadership and Corporate Social Responsibility and was part of the inaugural programme for Africa in 2014. She has also been trained on the role of Private Sector in Government Policy by Strathmore Business School and John Hopkins University; Investment Treaty Law and Arbitration-Africa International Legal Awareness (AILA) UK London and High Performance Boardrooms- Institute of Directors. She has also undertaken a number of leadership and management courses.