CHAPTER TEN
ENHANCING MANUFACTURING, ICT, TRADE AND SERVICES FOR ECONOMIC GROWTH
The Challenges:
The performance of the manufacturing sector and its contribution to the economy has been static and remains below potential. Kenya’s industrial sector is characterized by lack of large and basic industries.
Our industries also suffer from high cost of production due to expensive and unreliable energy, poor infrastructure and corruption. Furthermore, a number of industries, such as textile, leather, dairy and oil seed have collapsed, and many of our industries are operating below capacity. This is due to bad governance, poor industrial policies, insecurity, bureaucracy and indiscriminate implementation of liberalisation and privatisation of state controlled industries. The increase in oil prices and appreciation of the Kenya shilling has also constrained exports and encouraged importation of cheap goods that compete with locally produced goods.
Kenya also lacks technical universities to spur innovation. There are also inadequate research and development opportunities.
The prosperity of our country and its people cannot be guaranteed without scientific and technological advancement based on a clear roadmap to achieve industrial status.
Our Commitments:
We will promote industrialisation to produce high value goods for the domestic market and export.
We will promote location of industries at the point of production of basic raw materials to benefit producing communities and transform the rural economies.
We will address the issues of stagnation of small scale firms, securing of property rights and security of tenure, costs associated with entry, expansion and exit regulations, notably securing a licence, tax and labour laws compliance.
As Kenya is predominantly an agricultural country, the bulk of industries are agro-based. Hence, it is crucial to undertake simultaneous improvement of agriculture with industry as agriculture provides the raw materials for industry for industry to succeed. Value addition in agriculture is a key to our model of industrialisation.
We will seek dialogue and partnership with the private sector to develop ways and means to facilitate sustainable economic growth.
Your ODM Government will:
• Encourage and facilitate indigenous entrepreneurs to build industries to create an independent, prosperous, dynamic and vibrant, integrated, balanced and sustainable national economy.
• Facilitate the establishment of modern basic industries that meet domestic and export needs.
• Ensure that product standards are adhered to.
• Facilitate the establishment of industrial clusters as seed beds for innovation, exchange of resources and ideas, collaboration and increased specialisation for rapid growth.
• Promote the establishment of industries in rural areas to transform the rural economy and ensure equity in development.
• Nurture and retain high level human resources for the transformation of industries by improving the working conditions and remuneration of our scientists to retain talents and attract back those who have left because of poor working conditions and remuneration.
• Promote the development of young talent by initiating a scheme to provide funds for young scientists and to encourage and support them to undertake industrial-oriented research in science and technology.
• Establish new specialist, research-oriented science and technology universities and research institutions, which will play a pivotal role in the advancement of science and technology for industrialisation.
• Establish national annual science awards for individuals and institutions that make great achievements in scientific and technological research and innovation.
• Encourage investment banks to finance industrialisation.
• Strengthen the enforcement of the laws and processes of curbing dumping and importing counterfeit goods.
INFORMATION & COMMUNICATIONS TECHNOLOGY
The Challenges:
The latest information and communications technology (ICT) has enabled some countries to change their destinies and future of their people in under a decade. Fast growing economies such as India and China can attribute a considerable
amount of their success to the effective use of ICTs.
Kenya must adopt ICT policies that recognize the effective use of technology in addressing the many diverse needs of its people in the political, social and economic arena. In order for ICTs to be relevant to Kenyan society, ICT policy must strive to facilitate the development of local innovative technologies that are informed by local content and local knowledge.
The lack of adequate ICT infrastructure has hampered the provision of efficient and affordable ICT services in the country. The existing total capacity of Kenya’s Internet gateways is limited and thus is congested.
The Policy, Legal and Regulatory Framework are insufficient to deal with issues of e-security, ecommerce and intellectual property rights.
There is inadequate ICT education at primary, secondary, tertiary and community levels. There is no formalised ICT curriculum, and there are inadequate number of teachers of ICT, especially in primary and secondary schools.
There is no proper framework for evaluating and certifying ICT training programmes, and Kenya has difficulty in retaining skilled ICT manpower, especially within the government.
The access to ICT services is limited to a few major towns leaving the rural areas of the country uncovered.
Our Commitments:
We will urgently invest in ICT infrastructure, especially high-speed Internet backbone networks countrywide.
We will improve ICT usage in Kenya and increase penetration nationwide. We will ensure that the Internet service is cost-effective, reliable and efficient.
We will focus on the establishment of educational, research and innovation and governance networks so as to speed up the creation of an e-literate and e-novative society.
We will encourage ICT companies to create high quality jobs and spur research and innovations in this field.
We will seek to reduce bandwidth costs in Kenya by the use of fibre optics national gateways and mechanisms.
We will hasten licensing of players as well as provide tax and other incentives in the sector to promote competition and create more job opportunities for our youth.
We will create awareness of the opportunities offered by ICT in a whole range of sectors, from education, health, governance, etc.
Your ODM Government will:
• Establish, with great urgency, a fibre optics based Internet gateways to the rest of the world to achieve affordable and reliable broadband internet connection countrywide.
• Provide infrastructure support, such as, energy and roads to roll out the fibre optic backbone network.
• Encourage establishment of high-speed wireless networks.
• Provide incentives to promote local software development.
• Encourage local manufacturing and assembly of computers and accessories, mobile phones and networking equipment.
• Provide incentives for the provision of ICT infrastructure to rural areas.
• Promote ICT in education at primary, secondary, tertiary and community levels by developing ICT curricula and ensuring that teachers/trainers possess the requisite skills.
• Set up a framework for evaluating and certifying ICT training programmes.
• Establish networks for sharing training resources especially sharing of e-learning resources between institutions, for example, by upgrading the KENET (Kenya Educational Network) network infrastructure.
• Establish computer labs with Internet access to all primary and secondary schools.
• Exploit e-learning opportunities to offer Kenyan education programmes for export.
• Use E-government to provide a framework for improved service delivery, enhanced communication and information collection and provision within Government, with the citizenry and the business community.
• Develop an e-security structure in collaboration with the relevant institutions and an adequate legal framework and capacity to deal with national security, network security, cyber-crime and terrorism and to establish mechanisms for international cooperation to combat cross-border crimes.
• Use ICT to provide a framework for integrated systems for better and efficient health services.
• Promote Tele-medicine which supports health professionals in remote locations and Telehealth which provides information for preventive healthcare to remote rural populations.
• Support the development of E-commerce and ICT based industries.
• Ensure access to affordable and appropriate ICTs by the youth.
• Rally all stakeholders and development partners in supporting the creation of local content.
• Ensure the participation of women in ICT policy formulation and implementation at all levels.
TRADE DEVELOPMENT FOR ECONOMIC GROWTH
The Challenges:
Due to inadequate, inefficient, and poor infrastructure, trade policies and practices, internal trade in Kenya is limited. Consequently, the flow of goods and services from producers to consumers is hampered. As a result, artificial shortages and high prices are experienced in deficit areas while producer areas suffer waste and very low prices and incomes, together with unemployment.
Currently, our external trade is characterised by the export of raw materials and imports of finished goods. As a result, we suffer unfavourable terms of trade and grave deficits in the balance of trade. Our exports are largely uncompetitive in the
international market.
Our Commitments:
We will promote internal and external trade as an instrument for economic growth and development.
We will strengthen institutions that promote trade.
We will ensure that Kenya’s membership in international trading blocs adds value. We will also encourage the export of high value processed products to maximise export earnings.
We will develop an import policy that ensures that imported goods are of high quality and meet all safety and health standards.
Your ODM Government will:
• Promote internal and external trade as an instrument for economic growth.
• Create capacity within government to effectively project Kenya’s trade interests and extract value for the country in international trade negotiations.
• Encourage fair and equitable trade policies that will enable our producers to get a just return for their produce.
• Streamline import and export procedures to facilitate rapid growth of trade.
• Re-examine legal and regulatory frameworks to simplify and regulate trading.
• Strengthen quality assurance institutions to ensure that imports, exports and all goods sold in Kenya are to the highest international standards and prevent dumping of products.
SERVICES SECTOR
The Challenges:
The role of the services sector has changed dramatically in recent decades. Services represent the largest single sector in developed economies.
It is necessary to re-think and re-strategize the country’s development agenda in order to fully achieve the full potential of Kenya’s service sector.
Our Commitments:
We will develop the services sector and position Kenya as the regional business hub and a major exporter of services to the whole continent and beyond.
We will conduct detailed field based studies of the identified sectors in the countries whose markets we target for promotion of our services.
Your ODM Government will:
• Deploy government resources to market and promote the services sector to create quality jobs and earn foreign exchange.
• Take advantage of business process outsourcing and establish a major hub in Nairobi with relevant high technology infrastructure to operate call centres and other financial services related activities.