10 tough calls by Trade CS Moses Kuria in six months

By , K24 Digital
On Tue, 28 Feb, 2023 07:00 | 4 mins read
Investment, Trade and Industry Cabinet Secretary Moses Kuria
Investment, Trade and Industry Cabinet Secretary Moses Kuria PHOTO/Courtesy

Investment, Trade and Industry Cabinet Secretary Moses Kuria has on several occasions promised reforms to spur growth in trade and increase the flow of foreign direct investment (FDI) to Kenya and create employment opportunities.

However, several public outbursts by Kuria have rubbed traders the wrong way, as others celebrate his abrasive way of doing business. Below are some of the recent calls by the CS.

China Square

Last week, Kuria told Chinese investor Lei Cheng, who owns the China Square Unicity Mall and makes daily turnover of Sh20 million, to concentrate on manufacturing instead of engaging in trading activities that can be done by Kenyans.

He drew the ire of the foreign affairs Principal Secretary Korir Sing’oei, who reckons that the trader is in Kenya lawfully and should not “suffer any apprehension” as his protection is “equitable, non-arbitrary and non-discriminatory.”

The CS has since given an offer to the Kenyatta University Vice Chancellor Paul Wainanina to buy the lease from Cheng and hand it over to the Gikomba, Nyamakima, Muthurwa and Eastleigh Traders Association.

“We welcome Chinese investors to Kenya as manufacturers but not as traders,” Kuria said. He has offered to assist Cheng set up a manufacturing plant in Kenya and work on a distribution partnership with the traders.

Privatisation of Public Universities

In January this year, the Trade CS proposed the privatisation of some of Kenya’s public universities, saying a number owed debts worth billions of shillings and needed to be stabilised through private sector financial infusion.

He was in talks with international investors keen to partner with local universities.

Edible oil manufacturers

A number of edible oil manufacturers walked out of a stakeholder meeting the CS had summoned to iron out differences that were affecting the sub-sector.

Among the issues to be discussed included the application of the 16 per cent Value Added Tax (VAT). Manufacturers also wanted import duty to be capped at 10 per cent. However, the meeting degenerated into heated arguments, with manufacturers claiming the minister was high-handed, allegedly demanding that they cede company shares to powerful people in the current dispensation.

The CS told them off saying: Until such a time when we will have a fully vertically integrated edible oils industry, the government will continue taking measures to protect consumers from powerful cartels that continue to have high prices, warning that their days are numbered and that he will be their waterloo.

Duty-free maize importation

In November last year, Kuria allowed the importation of 10 million bags of duty-free genetically modified (GMO) maize to for six months to address the dire food shortage the country was facing due to failed rains, with over 4.2 million Kenyans at risk of dying from hunger.

However, the importation was criticized by food safety activists and farmers in Uasin Gishu and Tran Nzoia. The latter said the waiver was inappropriate, coming at a time they were harvesting the commodity, and said the importation would affect their profitability.

Nandi Senator Samson Cherargei told him to consult with experts and professionals in the field before making controversial pronouncements.

Import duty exemptions

CS Kuria disclosed last month that there is a proposal to introduce an Export and Investment Promotion Levy on imported goods such as pharmaceuticals and other products that have the local capacity, a move likely to hit hard major drug distributors who do not engage in actual manufacturing.

The levy is meant to protect Kenya’s domestic market, which has for long suffered from an influx of cheap products such as basic generic medicines like paracetamol, a common pain reliever.

Companies Act 2015

The Trade CS plans to sponsor a Bill in Parliament that seeks a reversal of the Companies Act 2015 companies Act, requiring that locals must have at least a 30 per cent stake in foreign companies.

He argued that the Act if maintained, will hinder his desire to increase FDI inflows from the current $500 million (Sh63.5 billion) to $10 billion (Sh1.3 trillion) by the end of the year.

Local investors have however criticized the move saying it will make it more difficult for them to conduct business in the country.

Ban on Mitumba

In October last year, the CS said the government will ban trade in second-hand clothing popularly referred to as Mitumba, once the textile sub-Sector has the capacity to handle the demand.

This attracted the attention of the National Assembly Speaker Moses Wetangula, who directed the Committee on Trade, Industry and Cooperatives to take up the matter with a view to knowing the reasoning behind Kuria’s alleged plan.

Kenya National Trading Corporation

The corporation is to borrow Sh15 billion from local commercial banks to fund the duty-free import regime of consumer goods.

The money will be extended to the state agency in the form of credit lines by two banks where the state has shares, for the importation of rice, cooking oil, sugar, wheat and beans. KNTC will also receive an additional Sh5 billion worth of credit to import subsidised fertiliser.

Kuria has directed that 100,000 metric tonnes of brown or milled white sugar, 900,000 metric tons of milled rice may be imported duty-free. This is in addition to 600,000 metric tons of milled rice

Airport at EPZ

In November last year, the CS clashed with Machakos Governor Wavinya Ndeti after announcing plans by his ministry to construct a cargo airport dedicated to the export of horticultural products at a land belonging to the East African Portland Cement he said was idle.

“We have discussed with a number of partners to use the idle land we have within East African Portland Cement to develop Kenya’s first exclusive cargo airport right here,” he said.

The statement was not taken kindly by Ndeti, who accused the CS of making road declarations without consulting leadership. She threatened to escalate the matter to President William Ruto after Kuria declined to pick up her call.

Mega manufacturing projects

While appearing before the vetting committee, Kuria promised to ensure each county gets an aggregation centre designated as a collection point for farmers to bring their products and prepare them for export.

The centres will have storage space and refrigeration. “It is my desire also to have a flagship mega manufacturing project in every county,” Kuria said while noting that each county has unique resources which can attract investors to open mega manufacturing plants for value addition locally.

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