Kenya’s manufacturers on Wednesday launched a policy tool-kit to aid the recovery of the sector from COVID-19 pandemic.
Mucai Kunyiha, chairman of Kenya Association of Manufacturers (KAM), told a virtual meeting that the industry has experienced a significant reduction in output, decreased liquidity as well as logistical challenges since the outbreak of the pandemic.
“The toolkit highlights overarching interventions needed to aid in the recovery of the manufacturing sector and economy, as businesses try to navigate different challenges brought about by the pandemic,” Kunyiha said.
According to the lobby, the manufacturing sector contribution to the gross domestic product (GDP) has been on a declining trend, dropping from 11 percent in 2012 to 7.5 percent in 2019.
The strategy also recommends a number of robust actions that stakeholders in the manufacturing sector need to undertake in order to be in a position to better build business resilience to stay resilient during this crisis and beyond.
The document also provides a roadmap in charting forward the growth, development, and resilience of the manufacturing sector so that it can attain the 15 percent contribution to the GDP as envisioned by the country’s national blueprint.
Kunyiha added that the initial policy interventions put in place by the government were based on the assumption that the COVID-19 pandemic was a short-term disturbance, but it is increasingly becoming evident that living with the virus is the new normal.
He observed that there is currently continued uncertainty about the future economic environment because of increasing transmission of COVID-19.
“Consequently, manufacturers are still facing low domestic demand for their products and reduced risk appetite of commercial banks to offer credit to manufacturers,” he added.
The manufacturers urged the government to set up an unemployment insurance fund to pay benefits to covered workers who become involuntarily unemployed and meet specified eligibility requirements, in order to cushion them in times of unemployment.