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Vision: To be a leading agent in catalyzing a diversified, globally competitive and sustainable industrial and enterprise sector in Kenya.

ACHIEVEMENTS OF THE MINISTRY FOR THE PERIOD JULY 2013 TO JULY 2014

MINISTRY OF INDUSTRIALIZATION AND ENTERPRISE DEVELOPMENT

ACHIEVEMENTSEase of doing business environment

As part part of private sector development, the •the Ministry is cordinating the Government reform on ease of doing business in collaboration with the Ministry of Lands and Housing, Ministry of Devolution and Planning, State Law office, Kenya Revenue Authority, Kenya Power, and KENTRADE. Ease of Doing Business reforms were fast-•tracked across various government agencies with significant changes being experienced aimed at improving country image and attracting investments.Facilitation of Private Sector dialogue through the •presidential round table was held and this has significantly created confidence on the level of Government commitment in facilitating business

Special Economic ZonesThe Ministry has developed a Special Economic (i) Zones Bill that has been submitted for

consideration and enactment by the National Assembly.Land has been identified in Mombasa, Dong’o (ii) Kundu, for the development of a Special Economic Zone. Master-planning for the Dong’o Kundu Special (iii) Economic Zone is ongoing.Growth in the Exports at the Export Processing (iv) Zones outpaced GDP with new Exports growing by 11%, investments growing by 25% and local employment in these zones growing by 13%.The Government has approved the establishment (v) of a private free trade zone in Kenya. Once this zone is operational, it is expected the cost of conducting international trade will be signficantly reduced.The Ministry has signed a Memorandum of (vi) Understanding with China Communications Construction Company (CCCC) Limited for undertaking a feasibility study for the establishment of a Free Trade Zone in Mombasa.

Mr. Adan Mohamed, EBSCabinet Secretary for

Industrialization and Enterprise Development

Dr. Wilson Songa, MBSPrincipal Secretary for

Industrialization and Enterprise Development

MSEA Stand received 3 awards at the Nairobi Interna-tional Show in October 2013, an indication of excellence in service provision to improve MSE competitivevness

KIE Sagana Industrial incubators/Sheds for agro processing

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MandateThe mandate of the Ministry is to promote Industrialization and Enterprise Development through Industrialization and Co-operative Policy formulation and implementation; implementation of the Industrial Property Rights regime; Private Sector Development Policy and Strategy; Quality Control including Industrial Standards development; Co-operative Savings, Credit and other Financial Services Policy and regulation; Development of Micro, Small and Medium Enterprises and Buy Kenya policy.

Industrialization Road MapThe Ministry of industrialization and Enterprise development has developed a comprehensive industrialization road map that will guide industrial development in the short to medium term period. The expected outcome of the road map for the next 5 years includes:

Creation of 5 million additional •jobs;Increase the contribution of the •manufacturing sector to 20% of the Gross Domestic Product;Increase the attraction of •foreign direct investments (FDIs) by five (5) times the current level;Improve Kenya’s ranking on the ease of doing business •indicators to top twenty (20).

The roadmap will focus on the following key sectors and enablers:

Key SectorsGrow critical sectors where the country has scale such as tea, •coffee, flowers, and horticulture;Promote value addition in sectors of natural advantage to create •competitiveness that include: textiles and cotton, leather, agro-processing, beef and fishing;Build local industries to support resource and infrastructure •investments in oil, minerals, infrastructure and geothermal;Transform government industries that include: Pan Paer mills, •sugar industries, coconut/cashew and pyrethrum;Enhance non-industrial job creating sectors such as ICT, retail •and wholesale trade, and Tourism.

Enablers Improve the ease of doing business through re-engineering •process and cost reduction;Enhance skills development, access to finance and development •of industrial infrastructure such as Special Economic Zones, Free Trade Zones, Industrial ParksEnhancing the potential of the Small and Medium Enterprises •Develop a compelling FDI attraction plan•Build a strong government delivery capability•

The Cabinet Secretary, Adan Mohammed tours Bata Shoe Company Ltd to assess local capacity to meet public procurement on “Buy Kenya Build Kenya initiative”

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Small and Medium Enterprise Sector

The Micro and Small Enterprises •Authority (MSEA) was setup and operationalized to facilitate SME growth through improved market access and ease of access to finance. The sector is now formally regulated for the first time since Independence.Awarded procurement opportunities •worth Kes 125.4 Million to firms owned by youth, women and persons with disability in the categories of General Office stationary, printing works, renovation works, furniture, office equipment, ICT equipment.The Ministry, through Kenya Bureau •of Standards (KEBS), supported the SME sector by issuing over 1,848 Standardization Mark permits alongside the 6,069 issued to large firms thereby contributing to increased global market access of Kenya products and new jobs.The Ministry, through the Kenya •Industrial Estates (KIE), Completed construction of 27 industrial incubators/sheds in Meru, Kwale, Sagana, and Bomet counties that is expected to house 27 incubatees and create over 400 jobs.MSEA facilitated 1,450 MSEs to •participate in various exhibitions in various counties.In collaboration with East African •Community, MSEA hosted the Jua Kali/Nguvu Kazi exhibition from 1st to 11th December, 2013 in Nairobi, Kenya thereby exposing Kenyan MSE products to the regional market.2,086 MSEs spread across •various counties were trained on entrepreneurial and skills upgrading programmes through support from MSEA.MSEA developed and •operationalized 16 worksites, during the 2013/14 financial year.

Value Chain DevelopmentThe Ministry, with support of the World •Bank, completed value chain studies in the leather and leather goods, textile and clothing, food processing, and furniture manufacture.The analysis has mapped out each sub-•sector in terms of structure, linkages and end products, current levels of productivity, current and potential demand from domestic and global markets, critical success factors, relevant policies, regulations and institutional frameworks, key players, and geographical dispersion of establishments.Plans of action have been developed for •two sub-sectors of textiles and leather.On the food processing, we have •selected five lead sub-sectors of dairy, meat and meat products, juice making, fish processing and animal feeds.The One Village One Product (OVOP) •program assisted several groups undertake processing activities in the Dairy, Honey, Fish, Processed vegetables and fruits (Flour, dried vegetables and fruits, wine, jam, paste, juice), Oil (Coconut, sunflower, avocado), Soap and lotions (Aloe, avocado), Herbal products (Aloe, Stinging nettle, amaranths), and Handcraft (Baskets, silk, carvings, wooden furniture, horn products).

Access to financeKIE disbursed KES 250 million to SMEs thereby creating over 3,000 direct jobs and over 6,000 indirect jobs.

Kes 50 billion savings were mobilized and •Kes 100 billion disbursed to members through Cooperatives. Deposit Taking • Savings and Credit Co-operatives (SACCO’s) increased new loans to SMEs by Kes 184.3 billion (17.3%) in year 2013 from Kes 157.1 billion in 2012 thereby exceeding target of 10%.The Ministry, through the SACCOs •Societies Regulatory Authority (SASRA) licensed addition 54 SACCOs to bring the total number of Deposit Taking SACCOS (DTS) from 140 to 184, coverage of 99.2%.SASRA intensified surveillance of the •DTS which resulted into increase of deposits by 15% from Kes 149.2 billion to Kes 172.3 billion.Through SASRA, deposit taking SACCOs •have been mainstreamed into the credit information sharing that allows listing of bad loans through credit reference bureaus thereby resulting in lowering of non-performing loan ratios from 7.4% in year 2012 to 4.7% in year 2013.Regulated SACCOs have also been •mainstreamed into Anti-Money Laundering initiative through the joint Financial Sector Regulators collaboration that is Central Bank of Kenya (CBK), Capital Markets Authority (CMA), Retirement Benefits Authority (RBA), Insurance Regulatory Authority (IRA) and SASRA.

INDICATOR REFORM UNDERTAKEN IMPACT1. Starting a

businessAdoption of a mobile phone technology platform to search and reserve a name

Time to search and reserve a name reduced from 3 days to immediate.

Decentralization of company registration to citizen’s one-stop-shop service centres

Number of procedures has reduced.

2. Getting electricity

Introduction of performance monitoring and measurement

Reduction of the number of days to get electricity from 160 days to 30 days.Appointment of account Managers and Investor

relationship Managers3. Registering

propertyRe-engineered land/records/file retrieval process Title search now takes 24 hours.Internet accessibility of KRA database for confirmation of stamp duty payments by the Lands Office

Rent clearance certificate endorsement, and payment of stamp duty also takes 24 hours.Valuation of property now takes 3 days.

Engagement of Private Valuers by Ministry of Lands to fast track valuation process

Registration of transfer of property now takes 4 days.

Staff training and enhancement of equipment Time taken to register property reduced from 73 to 12 days.

4. Protecting Investors

Sensitization and enforcement of existing laws protecting investors:

Companies Act (CAP 486)•Foreign Investments Protection Act (Cap 518)•Investment Promotion Act 2004•Capital Markets Authority Act (Cap 485A)•Investment Disputes Convention Act•Export Processing Zones Act (Cap 517) •

Investors’ rights including minority shareholders are duly protected.

5. Paying taxes I-tax system, an online system used by tax payers to report their tax obligations has been rolled out.

Administrative burden to companies reduced.

Consolidation of payment of taxes (PAYE and NSSF Fees).

Number of payments reduced from 41 to 17.

Adoption of Mobile Phone Money Payment platforms for small amounts of taxes by KRA.

Simplified payment procedures.

Enactment of VAT Act 2013 Simplified VAT procedures.

6. Trading Across Border

Establishment of a single command and Authority at Mombasa Port, Malaba and Namanga borders.

Time to clear cargo at Mombasa reduced from 5 to 3 days.

Reduction of weighbridges to 4 and introduction of weigh-in-motion weighbridges.

Turn-around times to Kampala, Uganda reduced from 18 days to an average of 5 days.

Implementation of Kenya National Electronic Single Window Systems (Kenya Trade Net).

Administrative costs and regulatory compliance by traders reduced.

7. Enforcing contracts

Review and strengthening of existing laws for enforcing contracts that include:

Law of Contract Act (Cap 23)•Sale of Goods Act (Cap 31)•Hire Purchase Act (Cap 507)•Chattels Transfer Act (Cap 28)•Consumer Protection Act No. 46 of 2012•Contracts in Restraint of Trade Act (Cap 21)•Government Contracts Act (Cap 25)•Trade disputes Act (Cap 234)•Arbitration Act No. 4 of 1995 and order No. 46 of •Civil procedures rules 2010

Contract enforcement •guaranteedArbitration law preserves •traders’ business relationship and market reputations.

8. Resolving Insolvency

Company Law (Cap 486)•Bankruptcy Act (Cap 53)•Insolvency Bill – currently in Parliament for •enactment

Resolution of insolvency disputes duly covered by the law.

ACHIEVEMENTS UNDER THE EASE OF DOING BUSINESS REFORMS

Mission: To facilitate the creation of an enabling environment for vibrant, globally competitive, sustainable and innovative commercial and industrial enterprises.

OVOP training on fruit processing to one of the groups. Through OVOP, groups and communities have received expertise in processing, packaging and branding and their products are now available in formal retail outlets.

KIE financed the expansion and modernization of Towel manufacturing plant in Nairobi Industrial Estate

Ugandan Exhibitors at the Jua Kali/Nguvu Kali Exhibition held in Nairobi, Kenya in December 2013

REPUBLIC OF KENYA


Vision: To be a leading agent in catalyzing a diversified, globally competitive and sustainable industrial and enterprise sector in Kenya.

ACHIEVEMENTS OF THE MINISTRY FOR THE PERIOD JULY 2013 TO JULY 2014

Innovation & ResearchThe Ministry, through the Kenya Industrial Research •and Development Institute (KIRDI) has developed laboratories for research in food processing, leather processing, renewable energy and natural products.KIRDI designed and produced eight hundred and forty •(840) Arc Welding Machine.KIRDI designed produced and supplied one hundred •and fifty (150) Hospital Beds (through partnership with MSMEs) to ten (10) Hospitals, with each receiving Fifteen (15) and Mattresses.3 pilot soya bean processing plants were operationalized •for production of soya flour, soya milk and other related soya products.The Ministry, through the Numerical Machining Complex •(NMC), designed an hydraulic brick making machines for production of quality and affordable bricks for the local market.NMC Designed and developed a rice harvester to •enhance the mechanization within the rice sector in KenyaDesigned and developed 6.5HP and 9HP Mavuno water •pumps.

Standards and quality infrastructureA total of 460 new standards were published and 772 •standards were reviewed.KEBS is implementing an electronic system to •enable technical committee members to participate in development of national and international standards electronically and allow consumers query the quality of products offered for sale from wherever they are.KEBS National Quality Institute trained 242 firms on •process management systems among which were 41 were SMEs to facilitate improvement of their processes and production systems leading to enhanced competitiveness in local and international markets.KEBS certified 30 new firms during the year to various •ISO management systems in order to improve processes and productivity of the certified organizations thus assisting to meet market requirements.KEBS partnered with Time Electronics to assemble, •install and commission scalable calibration benches and appointed distributor for the Middle East and Africa.KEBS’ researchers produced pure bacterial cultures •through scientific research leading to reduction of imported pure bacterial cultures (restricted in trade) from developed countries; and foreign exchange savings.

Interception of CounterfeitsThe Ministry, through the Anti-Counterfeit Agency (ACA) •trained over 34 magistrates and 10 prosecutors in an effort to improve the efficiency and effectiveness in the management of cases arising from Intellectual Property Rights (IPR) infringement or counterfeiting.The Agency trained over 600 government officers’ •identification of counterfeits and enforcement of Intellectual Property Rights.The Agency also undertook training for over 600 •government officers in various Ministries and Parastatals, IPR holders and community leaders drawn from public and private sectors.The Agency received and investigated complaints relating •to 180 cases and seized goods worth over Kes. 203 million.Counterfeit goods worth over KES 186 million were •destroyed during that period.The counterfeit products seized by the agencies included •counterfeit alcoholic drinks, cooking oil, electrical and electronics items, beverages, clothing and apparels, hardware tools and petroleum products, paints, computer power protection devices, cigarettes, mobile phone handsets, toners and inks, pencils, ball point pens, and pirated copyright books.The Ministry, through the Kenya Accreditation Services •(KENAS) attained membership to international Accreditation umbrella organizations that included:

Associate membership - International Laboratory Accreditation Cooperation (ILAC), Accreditation Body member – International Accreditation Forum (IAF).KENAS hosted the 3rd African Accreditation Cooperation •(AFRAC) General Assembly in September, 2013, an event that demonstrates its advanced level of maturity and recognition both in the region and continent.Active participation in regional /international cooperation •in accreditation activities at the EAC,COMESA, SADC and AFRICA level culminating in the establishment of the East African Accreditation Board (EAAB) under the EAC standardization quality Assurance and Standardization, Act (EAC,SQMT Act, 2006)Accredited 20 Conformity Assessment Bodies (CAB’s) out •of which 16 covered testing and calibration laboratories, 2 medical laboratories and 2 inspection bodies.

Strengthening the Cooperative SectorThe Ministry achieved the following in line with the strengthening and enhancement of the sector during the period July 2013 to June 2014:

The World Council of Credit Unions (WOCCU), ranked the •Kenyan co-operative movement as 1st in Africa and 7th in the world as well as the fastest growing movement in the world.1,194 co-operative enterprises were registered, including •2 for Kenyans in the Diaspora and 200 which were Youth-based. This resulted into a total of 15,867 registered co-operative enterprises with a total membership of 10.2 million.Savings and Credit Co-operatives (SACCOs) increased their •asset base by Kes74 Billion.Innovative co-operative business models and ventures were •adopted resulting to expansion of the sector into emerging high growth, value addition, areas in the Dairy, Coffee and Horticultural sub-sectors.

Policies reviewed and developed The Country’s first comprehensive road map on i) industrialization was developed and sets the country on the path to achieving manufacturing contribution to GDP at 20%, growing investments five-fold and drastically improving the Ease of Doing Business The Scrap metal Bill was finalized and tabled in parliament ii) to regulate the scrap metal sector that will protect private and public investments from vandalism that has cost the economy approximately Kes.60 billion annually.Co-operative Societies Act, Cap 490 and the SACCO iii) Societies Act were reviewed to align them with the constitution.A draft Accreditation Bill has been developed and forwarded to iv) the National Assembly for enactment.

Master plan for the Research Technology and Innovation Laboratories, at KIRDI Western Region Centre, Kisumu

Shop floor of a textile and apparel manufacturing plant at EPZ Athi River producing for the AGOA market

Tour of New KCC Kiganjo store for powdered milk by the Principal Secretary Dr. Wilson Songa

Inside of the Soya Milk Processing Pilot Plant in KIRDI’s Western Region Centre, Kisumu County. Due to the nutritional value, the demand for soya products has significantly increased globally.

Testing Services being undertaken at KEBS Headquarters, South ‘C’

The Ministry, through the Anti-Counterfeit Agency (ACA) trained over 34 magistrates and 10 prosecutors in an effort to improve the efficiency and effectiveness in the management of cases arising from Intellectual Property Rights (IPR)

infringement or counterfeiting

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