KEPSA participated in the launch of the report titled ‘Integrating Kenya’s Small Firms into leather, Textiles, and Garments Value Chain; creating jobs under The Big Four Agenda’. The report, commissioned by the Ministry of Industry, Trade and Cooperatives seeks to put into perspective the challenges the MSMEs experience that is hindering their growth, therefore, informing data led policies for an enabling business environment.
In his Keynote address, Cabinet Secretary Ministry of Industry, Trade, and Cooperatives, Hon. Peter Munya acknowledged the 14% growth recorded by the apparel sub-sector in the overall contribution of manufacturing to the Gross Domestic Product. Additionally, he stated that businesses especially the MSME need to operate in decent working spaces provided by the government, therefore, linkages between the two levels of government are key in ensuring business thrive. Finalizing on his remarks, he noted that the operations on implementation of the SME fund are near completion sending a promissory note to the MSMEs in the country.
Unpacking the report to the audience, Ms. Anzetse Were, a senior Development Economist with Overseas Development Institute (ODI) affirmed that from the study MSMEs are on the lower end of the business value chain thus the economy is not fully realizing the GDP from the MSME sector. The sector employs close to 14.9 million people equivalent to 78% of the entire Kenyan labour force. The MSMEs collectively contribute to a third of the country’s Gross Domestic Product. Over 85% of the 7.4 million MSMEs are unlicensed therefore a huge potential for revenue generation with the correct incentives put in place.
Representing Invest in Africa (IIA), Kenya’s Country Director, Ms. Wangechi Muriuki reiterated her organization’s support for the MSME sector through their continued efforts in upskilling and providing accesses to markets. IIA seeks to create linkages in order to simplify trade through its online platform, biashara.now, which was rebranded and relaunched at the meeting. The platform has been able to register 2250 MSME and SME who in turn have accessed 67 tenders worth Ksh.270 million provided for by the 20 partners who have on-boarded into the platform creating about 5000 jobs.
In conclusion, it was agreed that in order to integrate MSMEs into the value chains, provision of information along the value chain to assist financers and linkage programs will be key. Additionally, safeguards against illicit trade was highlighted as crucial thus preventing the undermining if small manufacturers. Finally, it is evident that in order to drive any transformation in Kenya’s economy, great focus needs to be put in the MSME sector.
The meeting was organized by The Ministry of Industry, Trade & Cooperatives, The Overseas Development Institute(ODI), Msingi East Africa and Invest in Africa.