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Kenya

Kenya to revamp investment

NAIROBI, Kenya Dec 15 – The transformation of the current Export Processing Zones into Special Economic Zones could be underway in the next six months.

This follows the launch of a draft policy on Special Economic Zones (SEZs) on Tuesday to be discussed by stakeholders before being presented to Parliament for adoption into law.

Export Processing Zone Authority Acting Chief Executive Joseph Kosure said this is in line with the first Medium Term Plan of (2008-2012) of Vision 2030 of developing SEZs to broaden the country’s investment opportunities.

“If things go our way we would wish to have the first Special Economic Zone set up by mid next year,” he said.

His remarks comes hot on the heels of President Mwai Kibaki’s directive during Jamhuri Day celebrations on Saturday to complete all preparatory works so that the projects could be launched within the next six months.

Mr Kosure said the rationale for establishing SEZs is to spur economic growth and enhance global competitiveness of Kenyan products.

The policy change will also transform the Export Processing Zones Authority into the Special Economic Zones Authority.

The Export Processing Zones program was implemented through Cap 517 enacted in 1990 to promote export-oriented investment with designated zones and has served to expand investment in export activities.

Stakeholders present during the launch, believe the transformation would complement international best practices, where countries that embraced the concept of EPZ as an economic program geared towards export oriented processing, have been moving to SEZ programs.

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Also speaking during the launch, Trade Assistant Minister Omingo Magara said the government remained committed towards partnering with private sector players to ensure the transformation is realized in good time.

“I can tell you through close linkages between the private sector and government we can help you to achieve this goal but we must partner in every step of the way to ensure we are in agreement,” Mr Magara said.

He said the EPZ program had attained maturity which warranted the process transformation.

Through the program, EPZs have accounted for close to 10 percent of national exports. Mr Magara however believes with the transformation, the figure could rise to as much as 30 percent.

“The transformation of EPZs to SEZs is timely and necessary in view of changes in the dynamic local, global and regional economic environment,” he said.

“The Special Economic Zones (SEZs) will provide opportunities to open up new areas to investment, offer a menu of activities which the private sector can participate in,” he added.

Key benefits spelt out in the draft policy include: Attracting both local and foreign investments with improved infrastructure in addition to incentives and minimal regulations.

Promote value addition by encouraging value chain integration for specific sectors. This is primarily seen as a sure way of job creation to cater for the ever-growing number of unemployed Kenyans.

It is also expected to promote rural and regional industrialisation by exploiting comparative advantages of local resources. The SEZ program is believed to encourage establishment of industries in rural areas based on resources found in those regions.

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It is believed this will cut down rural-urban migration, which has seen many Kenyans move to major towns and cities in search of jobs.

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