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China-Africa Trade Information Service
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As of November 2018, the value of import orders for Kenyan plants increased by Sh62.88 billion.
Traders and factories shipped in non-food industrial supplies worth Sh568.11 billion in January-November period, latest data by the Kenya National Bureau of Statistics (KNBS) indicate, a 12.45 per cent growth over Sh505.23 billion in the same period in 2017.
Besides industrial supplies, the other driver of imports was petroleum products whose value climbed Sh61.21 billion, or 24.34 per cent, to Sh312.704 billion in the period.
President Uhuru Kenyatta is banking on modernisation and development of new factories to help generate targeted 800,000 new decent jobs for the youth under "Big Four Agenda" economic transformation plan by 2022.
To achieve that, the sector's contribution to the national wealth, technically gross domestic product (GDP), is expected to grow to 15 per cent from a revised decades-low of 7.9 per cent in 2017.
The plan, under the manufacturing pillar, is to create an additional 1,000 small- and medium-sized (SMEs) factories in targeted sub-sectors such as agro-processing, leather, textiles and fish-processing.
Treasury Cabinet Secretary Henry Rotich says in the Budget Statement 2018 the manufacturing sector will have to add $2 billion to $3 billion (Sh200.32 billion to Sh300.45 billion) every year to the GDP to attain the projected 15 per cent share of the national wealth.
Some of the targeted incentives extended to the manufacturing sector this financial year, which are in line with Vision 2030s third Medium Term Plan 2018-22, include reduction in electricity costs, higher duty on selected imports as well as remission of duty and exemption from Value Added Tax on key raw materials.
Manufacturers have cited higher electricity prices compared with regional peers as one of the drivers of the high cost of production for the domestic industry, with Kenyan companies estimated to be at least 12 per cent less competitive than the global benchmark.
Average industrial power tariff in Kenya at $0.1365 (Sh13.67) per kilowatt-hour in January 2018 was higher than neighbouring Ethiopia's $0.066 (Sh1.66), Tanzania's $0.0688 (Sh6.89) and Uganda's $0.1226 (Sh12.28), according to an analysis by the African Development Bank.