Kenyan manufacturers have been challenged to tap into the huge Democratic Republic of Congo (DRC) market, after its inclusion in the East African Community (EAC), by becoming innovative and globally competitive.

Kevit Desai, EAC Principal Secretary said industrialists should target to increase their production capacities by doing value addition, so as to be able to meet the demand of the 300 million EAC population. Speaking during a tour at Capwell Industries in Thika which manufactures maize flour and rice, he said the six-nation EAC market has become huge, opening up new opportunities for manufacturers to trade. Desai said DRC, having a market of over 300 million in terms of population, both locally and in the neighbouring countries, offers Kenyan manufacturers a large market for their produce.

He said DRC inclusion in the EAC has offered a big opportunity to our manufacturers, to think big and increase production by growing competitive, innovative and diversifying their production capabilities.

Value Addition

“Value addition has the highest transformative ability, for example, in pyrethrum it increases its value 25 times thus higher returns,” said Desai. The PS said the impact of increased industrialisation would be opening up opportunities for new jobs, offering markets for local produce and consequently fighting poverty in the region.

He said despite the EAC being a big market, only 12 per cent is traded within the market in terms of intra-trade compared to other blocks like the European Union (EU) that trade at 60-70 per cent, with Kenya being the largest exporter, commanding a growing figure of Sh250 million dollars. 

Kenya Association of Manufacturers Chairman, Rejan Shah, decried the high taxation and cost of raw materials, transportation costs and tariffs, saying they have frustrated many manufacturers and kept others out of the market.

Rajan, who is also the Managing Director, Capwell industries called on manufacturers to become competitive, look for markets abroad, improve efficiencies and invest in technology.

Lost opportunities

“We have lots of lost opportunities because we have about 6,000 tariff lines of items that can be exported duty free into the US, but we only do about 10. The manufactured component we export is about 30 per cent and needs to move up to 70-80 per cent, to match high valued exporters such as Vietnam,” said Rajan.