June 27, 2018 / 2:49 PM / 2 months ago

Kenya tries to tackle illicit goods to boost manufacturers

NAIROBI (Reuters) - Kenya has started a campaign against what the government calls illicit goods to help local manufacturers, the minister for industrialisation said on Wednesday.

The goods involved range from sugar to cigarettes, and they account for 40 percent of all traded goods in Kenya, said Carol Kariuki, the chief executive of the Kenya Private Sector Alliance (KEPSA), an umbrella body for local companies.

Some of those are imports supposedly intended for transit to a neighbouring country, then diverted to the local market with no import fees paid, Kariuki said. Others are disguised as imports of lower value, thereby evading taxes. Still others are local counterfeits.

All of them compete with goods produced by Kenyan manufacturers, whose promotion President Uhuru Kenyatta has made one of his four priority areas. He wants to double their share of annual economic output to 15 percent by 2022, helping to create much-needed jobs.

The crackdown started this month, Adan Mohamed, the industrialisation minister, told Reuters. So far, investigators have discovered mercury-laced imported sugar held in warehouses and dozens of shipping containers full of illegally imported cigarettes.

The head of the state-run standards body, seven other officials at the agency and two businessmen were charged with attempted murder on Monday for allowing imports of substandard fertiliser containing mercury, part of the campaign.

KEPSA’s Kariuki said the fight against illicit goods was necessary to protect local manufacturers and their investments from unfair competition.

“It’s something that has grown as the economy has grown. It will take us long,” she said.

Ayub Savula, an opposition lawmaker whose sugar-growing constituents in western Kenya have borne the brunt of the illegal sugar imports, dismissed the government’s efforts.

“We don’t have faith in this crackdown. This is just cosmetic,” he told Reuters, saying some illegal importers had been facilitated by government officials.

Editing by Larry King

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