Press Center | Freight Shipping Logistics News
Dec 8, 2010
General
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Manufacturers have opposed a proposal by the Export Processing Zones Authority (EPZA) that companies operating in the zones should be allowed to sell 70 per cent of their products in the domestic market.
Manufacturers have opposed a proposal by the Export Processing Zones Authority (EPZA) that companies operating in the zones should be allowed to sell 70 per cent of their products in the domestic market.
The Kenya Association of Manufacturers (KAM) said allowing EPZs to sell the bulk of their products in the domestic market would pose unfair competition to local manufacturers.
“They enjoy a tax holiday besides other tax exemptions, reduced import duty and waivers meant to promote exports. If these people are allowed to offload their products in the same market we operate in, it would give them undue advantage,” said KAM chief executive Ms Betty Maina.
She added that most of the products produced by the EPZs are the same ones made by local manufacturers who do not enjoy such incentives from the government.
During an investors’ forum in Mombasa, EPZA chairman Mathenge Wanderi, called on Trade minister, Chirau Ali Mwakwere, to consider revising the rules due to “EPZs’ shrinking markets” as a result of the coming into effect of the East Africa Community common market protocol in July this year.
EPZs are allowed to sell 20 per cent of their products in the domestic market and export 80 per cent, but they say that with the domestication of the EAC market by the protocol, they have to look out for other markets.
Citing stiff competition from Asian countries for foreign markets and high production costs in the country especially electricity, Mr Wanderi noted that most EPZs are on the verge of collapse.
The Kenya Association of Manufacturers (KAM) said allowing EPZs to sell the bulk of their products in the domestic market would pose unfair competition to local manufacturers.
“They enjoy a tax holiday besides other tax exemptions, reduced import duty and waivers meant to promote exports. If these people are allowed to offload their products in the same market we operate in, it would give them undue advantage,” said KAM chief executive Ms Betty Maina.
She added that most of the products produced by the EPZs are the same ones made by local manufacturers who do not enjoy such incentives from the government.
During an investors’ forum in Mombasa, EPZA chairman Mathenge Wanderi, called on Trade minister, Chirau Ali Mwakwere, to consider revising the rules due to “EPZs’ shrinking markets” as a result of the coming into effect of the East Africa Community common market protocol in July this year.
EPZs are allowed to sell 20 per cent of their products in the domestic market and export 80 per cent, but they say that with the domestication of the EAC market by the protocol, they have to look out for other markets.
Citing stiff competition from Asian countries for foreign markets and high production costs in the country especially electricity, Mr Wanderi noted that most EPZs are on the verge of collapse.
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