KAM welcomes removal of manufacturers’ bonds

June 13, 2014
Shares

,

Manufacturers say this will eliminate bottlenecks in the clearance of white refined sugar/FILE
Manufacturers say this will eliminate bottlenecks in the clearance of white refined sugar/FILE
NAIROBI, Kenya, Jun 13 – Kenyan manufacturers have welcomed the removal of bonds for gazetted manufacturers adopted in the 2014-15 budget by Cabinet Secretary for the National Treasury Henry Rotich on Thursday.

Manufacturers say this will eliminate bottlenecks in the clearance of white refined sugar.

Kenya Association of Manufactures (KAM) Chief Executive officer Betty Maina says removal of these bonds will reduce the cost and burden of sourcing for this raw material.

“Kenya is a net importer of industrial sugar, which is a very critical raw material for sectors such as food and beverage sector and the pharmaceutical sector. The removal of these bonds will reduce the cost and burden of sourcing for this raw material,” Maina said.

Maina also praised the enforcement of the 40 percent procurement preference for all locally manufactured goods as this will expand local markets.

Other new developments that the industrial sector welcomed include the development of Industrial parks and clusters along the railway line, a scheme established under the Special Economic Zones (SEZ).

“Industrial beneficiaries of yesterday’s budget include the local metal sector which is expected to see growth after duty on specific tariff lines of steel products was raised by 25 percent,” she noted, a move that will concurrently raise Sh2.6 billion for the government in tax revenues.

Maina however bemoaned the removal of duty on inputs of solar equipment, noting that the local manufacturers of solar equipment would be rendered uncompetitive due to an influx of imports even though the reduced duty would promote use of solar energy in the country.

Manufacturers were not also happy with the long term measure to refund VAT refunds amounting to about Sh27 billion owed by the government to the industrial sector. “This problem affects their cash flows and we would like a quicker solution,” Maina added.

Shares

Latest Articles

Stock Market

Most Viewed