Industrialisation Principal Secretary Juma Mukhwana on Tuesday, April 18, explained why the government was yet to resuscitate ailing state-owned firms.
Giving an example of Mumia Sugar and East Africa Portland Cement, the PS, who was appearing on KBC, remarked that the companies continued experiencing financial and management challenges despite periodic government intervention.
He explained that the government was not structured in a way to successfully compete in the manufacturing industry.
“After independence, the country set up industries which at that time played a role in terms of laying the foundation for manufacturing and employment of people.
“This program failed in the long run because the government’s primary role is being a referee and providing a good environment for manufacturing to thrive,” he explained why many state-owned industries were collapsing.
Instead of focusing on government-owned industries, Mukhwana explained that the government was going to empower the private sector.
“The industries that have failed are owned by the government while private ones are prospering.
“For example, in the Western part of Kenya, the sugar industry is thriving. It is just that the public-owned mills are collapsing,” he remarked while giving Mumias Sugar Company as an example.
On what the government had in plan, he detailed, “The government is going to set up industrial parks across the country where the private sector will get free space to set up industries.
“The national government has already put aside Ksh4.7 billion for the exercise in the next financial year with county governments promising to match the amount,” he added.
Mukhwana further explained that the government had put in place measures to make sure the government supported local industries.
“If you want to import something we can manufacture locally, you can do so but we will use the funds to create Industrialisation Fund,” he stated.
He added that the Industrialisation Fund would act as a kitty where Kenyans can borrow to venture into the manufacturing sector.
Mukhwana further indicated that every government entity by law must procure at least 30 per cent of their goods from local companies.
The statement from the PS came against the backdrop of a section of Western Region leaders opposing the move to privatise Mumias Sugar Company.
The leaders led by Bungoma Governor Ken Lusaka, Senate Majority Whip Boni Khalwale and Vihiga Senator Godfrey Osotsi vowed to oppose such a move.
"This is not out of disrespect for the President and the government. That is the little we have in the economy of the sugar industry," the Kakamega Senator remarked.
