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Kenya

KAM says war on contraband should not impact legitimate business

KAM pointed out that following the crackdown on illegal goods, genuine manufacturers were negligently and inaccurately mentioned and listed in the context of illicit trade, and specifically the issue on imported sugar/FILE

NAIROBI, Kenya, Jun 26 – The Kenya Association of Manufacturers (KAM) says the war against substandard goods and contraband in the country should not be conducted at the expense of legitimate local industries.

Through a statement, the association pointed out that following the crackdown on illegal goods, genuine manufacturers were negligently and inaccurately mentioned and listed in the context of illicit trade and specifically the issue on imported sugar.

“Of utmost concern is the threat that inaccurate and negligent reports such as these pose to the country’s efforts to boost trade with its neighbours in the EAC and markets in other trading blocs,” it stated.

“In the past three months, we have had difficulties trading sugar-based products with Tanzania and Uganda due to a misinterpretation of Gazette Notice 4536 – which was issued to combat the effects of drought and famine in the country.”

It stressed that whilst the fight against illicit trade is a vital intervention, it is essential that efforts are not diverted to frustrating genuine businesses, especially in the context of a manufacturing sector that is severely affected by the trade of counterfeit and sub-standard goods.

“The listed manufacturers did not import sugar under this exemption. Furthermore, any sugar-based products made in Kenya are manufactured using industrial sugar imported under the EAC wide duty remission, which attracts a payable rate of 10 per cent duty,” it stated.

It explained that the Kenya Revenue Authority has provided detailed information to partner states, with evidence that manufacturers of sugar-based products imported industrial sugar under the EAC duty remission scheme.

“They have additionally provided evidence of sample paid entries that demonstrate that companies producing these goods have been subjected to the 10pc duty as they fall under EAC duty remission scheme,” KAM said.

“Hence it is a big blow to the local industry when these inaccurate media reports surface to undermine significant progress that has been made by the country towards strengthening trade relations with our valued partner states.

This report has also contributed to the unnecessary closure by government agencies of manufacturer’s white refined sugar stores when focus and resources should be targeting illicit and sub-standard goods.”

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