Salutations:
Your Excellency the President, Hon Mwai Kibaki,
Your Excellency the Vice President Hon. Kalonzo Musyoka
The Minister of Industrialisation Hon. Henry Kosgey
Honourable Ministers and Senior Government Officials
Invited Guests and Your Excellencies High Commissioners
& Ambassadeurs,
Fellow members of the KAM
Ladies and Gentlemen
"Everyone has inside of him or her, a piece of good
news.
The good news is, that you don't know how great you can
be!"
It’s great to be 50! Thank you so much for joining us
today for this Lunch which marks the end of our
celebrations which we began last year on the 18th of June.
I congratulate my colleagues and members of the
Association who have shown that indeed Kenya is
built upon the hard work and enterprise of its people.
Our Chief Executive has given us a brief presentation on
the past 50 years and some of the
experiences and challenges that the Investors in Industry
have had to overcome to get where we are
today. And we celebrate that tenacious Spirit of
entrepreneurship everywhere.
For my remarks I would like to take a leap forward into
the future and I invite you all to join me.
The date is 23rd June
2030. The occasion is the Annual General Meeting of the Confederation of
Kenya Industries (CKI) – the umbrella body of Kenyan
Business and new Name of the organisation
that was called Kenya Association of Manufacturers in
2010.
CKI is just celebrating its 70th Anniversary as a Business Association.
I have been invited to attend the
evening as a former chairman of the Organisation – having
served as its 18th Chairman way back
between 2008 and 2010.
AS I look around I am struck by several things
We are meeting at the KiWANDANI Industrial Complex in
Isiolo a major booming industrial town in
Central Kenya. I have heard that there are serious
considerations by the Government to move the
Capital but you know us Kenyans – you never know what we
can come up with!
When it was first established in 2011 as one of the Vision
2030 flagship projects, this complex
initially focussed on Value addition for livestock
products and the beef industry and I did not really
think much about it!
As I look around I see so many players in Kenyan industry
and the membership of the CKI now stands
at more than 10,000 firms up from 670 in 2010.
Today in June 2030, Kenyan industry is thriving. Our
Population in Kenya is 65mn and East Africa has
a population of 180mn and EA is now a constituent &
dominant part of the African Union a Common
Market with free trade in goods and services and covering
the whole of Sub Saharan Africa with a
market size of over 700mn people!
50 million tourists per year frequent our region and the
eighth wonder of the World is now the most
sought after tourist destination in the World attractive
with the highest bed prices per night in the
World. Isiolo, Diani and Kilifi are world reknown resort
cities bringing in billions of dollars in annual
revenues.
Today in 2030 in Kenya we have a highly developed
agro-processing industry. Not just Mumias and
Bidco, but several other Kenyan global MNCs with
operations across Africa, China and Europe have
emerged from agro-processing. All our farms are now
greenhouses and are all under irrigation and
we have done away with the swings and weather dependencies
that we had experienced in the
drought s of 2006 to 2009. We still harness the sun and
the minerals for agri-business and we have
no shortage of water anymore. From this base, and
foresight and the learning from the chronic
droughts a strong policy and action from 2011 and beyond
the nation embarked on a massive Rain
water harvesting, Water banking and Water sheds Mission
where it was made mandatory for all to
enforce this in every suburb has today benefitted all the
people of Kenya. Every town, city and
location has been connected through huge new ring mains
water pipelines so no area goes without
water at any time.
The Special Economic Zones of Greater Mombasa, Lamu and
Greater Kisumu are thriving
metropolises and are the pride of Africa as far as
preferred investment zones go with over 15 million
high quality jobs and continental headquarters of
thousands of Global Multi National Companies.
The Malili technopolis is widely acclaimed as the Silicon
Valley and Bangalore of Africa. One of our
pioneer soft ware developers and exporters, Craft Silicon,
who had opened up their campus in 2012
have also set up at the Technopolis and are one of the
anchor investors in the region. Craft Silicon is
to us what Microsoft was those days to the US. We are the
center of innovation. A young scientist
Angela Chemutai at Craft Silicon won the Africa
innovations Awards last year – one in a long line of
Kenyan distinguished participants.
The Nairobi International Financial Centre last year was
officially declared the first true international
financial centre in the World and only the eighth after
New York, London, Frankfurt, Zurich, Abu
Dhabi, Beijing and Mumbai. Indeed we can proudly say that
Nairobi is now the financial innovation
capital of the World, a trend that started way back in 2007
with MPESA and 2010 with MKESHO. We
did this only by changing policy and acting on the ground
to make the laws for the NIFC making it the
preferred destination due to the entire ambience and
proliferation of the 5 new Cities under the
Nairobi Metropolis.
Kenya is now not only energy secure but a regional
supplier of power after connecting to the South
African Power Pool with abundant, reliable and cheaper
energy from Geothermal, Wind and most
recently nuclear energy. This Nuclear Power Project which
we have set up was creatively done
without any investment from Government except for
provision of land and on a Government
Guaranteed power purchase agreement at a guaranteed price
of UScts3 for the period of 20 years
AND most importantly without any capital investment from
Government.
Kenya now boasts the most modern communications and
transport infrastructure with the jewels in
the crown being the ports of Lamu, Mombasa and the two
private ports that Kenya allowed the
private sector to build and operate on a competitive
basis. The Kenyan coast is now the largest
transshipment port in the Eastern Coastline of Africa and
the dual standard gauge electric railway
lines that connect them to our fellow members of the East
African Federation – Ethiopia, Sudan,
Uganda, Rwanda, Burundi and the DRC have made these
countries very competitive too. We look
forward very soon to the completion of the land-bridge
connecting Lamu port on the Indian Ocean
to Kribi in Cameroun on the Atlantic. Our superhighways
and urban transit systems are truly world
class, especially in the Special Economic Zone cities of
Greater Mombasa, Greater Kisumu, Lamu as
well as the Resort Cities of Isiolo, Diani and Kilifi. Our
superhighways and urban transit systems are
truly world class – but we cannot rest on our laurels yet.
We need to keep up with the need for
safer and faster connectivity in the region.
Our educational system transformed itself into an enviable
trainer of innovative and entrepreneurial
titans and firmly entrenched Kenya as Africa’s
intellectual and innovation hub.
Public services to the mwananchi are a pure joy. The
ability to register births, land, marriage and to
interact and challenge government agencies paperlessly and
painlessly right from our homes is a
Vimal Shah’s Speech at the KAM 50 years Luncheon 23rd June 2010 Page 4
significant departure from the frustrating bureaucracies
of the past. People no longer pay anything
in cash currency as most payments are electronic and
virtual banks have begun all over.
And what a green, clean country we now are, having
achieved the 10 percent forest tree cover 7
years ago that we had sought for so long. Last Saturday I
took my grand children for a bike ride along
the Nairobi Greenline – on the edge of the National park.
At least it is good to note that some things
from my time are still there. Nairobi National Park is
still there now a higher quantity of wildlife and
the trees on the Greenline have grown so well. It is so
wonderful to walk and picnic there.
I am pleased to be a part of Kenyan industry association
as it celebrates its 70th
year. And to
celebrate a highly successful and competitive
manufacturing sector which is second to none in
Africa! Kenya is now not only food self sufficient but a
regional supplier of all value added products
which are fully processed and sent direct to the stores
all over the world through our new Aerotropolis
that was mooted in the year 2010 and completed in 2015.
Our concept started with a dream
of making Kenya a regional and African hub has succeeded
after some very radical thoughts
exchanged via the Public Private Dialogue that was
encouraged. This ended up in the Government
taking steps to enter into Land Banking and purchasing at
market rates all surplus land that was
strategic in its growth plans and also that was idle and
not producing. At that time this gave the
government a huge ablity to execute projects and also be
investor friendly where industrial parks
were then enabled some of them ending up as Special
Economic Zones.
I would never have thought I would see this day.
Back in 2010, when I was chairman of KAM, our dialogue
with Government was characterised by
what seemed to be insurmountable problems with regard to
the Business Climate. That year the
Price of Electricity reached 20USCts per unit when our
neighbours in Uganda were paying half the
rate of 10UScts. Indeed the neighbouring Governments were
courting Kenyans with a guaranteed
price of power at 5UScts.
The Main cities of Kenya were very congested and sometimes
it took 1 hour to drive 1km at peak
time. We badly needed new roads and better behaved drivers
– not now sure in what order!
Local Authorities would arbitrarily increase rates and
charges without much prior consultation and
wide publication. Indeed I used to advise members not to
go to work or their offices on Friday
afternoons as that was the favourite time for City Council
to arrest Company Executives!.
KRA was a very effective revenue collector – even if we
did not like their tactics very much. However
many other bodies also allocated themselves revenue
collections roles through the licenses and
regulations they administered.
WE were very worried about the spread of fake products and
intellectual property rights violations
which had stunted the growth of our creative industries at
that time.
SO HOW DID WE DO IT
Back in 2004 the Government of Kenya had realised the
deplorable state our Infrastructure was in
after years of failure to invest. All main roads were
potholed and nearly impassable, energy supply
was critical and indeed there was widespread fear of
rationing in 2006 following poor rains.
The Government started to prioritise Infrastructure
rehabilitation and reconstruction. Increasingly in
its allocations, this was quite evident. By 2010 most of
the main highways were under rehabilitation
or reconstruction.
Besides Roads, the government also focused on the energy
sector and expanded Capacity especially
in Renewable sources of energy. Government also realised
then that there would be no
development without energy. In 2010, the decision was made
to do whatever it took to eliminate
the energy problem. It was the year in which all necessary
resources were applied to developing
Geothermal resources, embarking on Nuclear Energy studies
and incentivizing green (wind, solar and
bio) energy. I remember way back in May 2010 KENGEN
commissioned a 35MW of additional
Geothermal power but today we have more than 7,000mw of
Geothermal Power being generated
by 20 more Private Sector players who were allowed to set
up generating plants. This whole
paradigm shifted when the sector on power distribution and
power trading was liberalised. It was
realised that Competitive forces would be the only way
that the distribution of power would be
made customer friendly and today although KPLC remains the
largest distributor of power they have
a 40 per cent market share while 3 other power
distribution companies have a 20 percent share
each. Power Projects used to take 24 months to negotiate
and finalise! Today power projects are
concluded in a guaranteed period of 30 days and the policy
is also very clear and transparent.
At the 50th
year celebrations of KAM the
private sector asked for an industrial park to be set up
between Naivasha &Nakuru and one more in Isiolo
exactly where the new Geothermal power was
available so that Industries would get the power to not
only promote demand but to obtain free
steam which the geothermal plants were releasing to the
atmosphere. This not only gave them
steam but also carbon credits were approved and that made
the geothermal power very viable.
We achieved all this because the government and private
sector joined hands together from the
year 2008 to implement Vision 2030!
Bold decisions were made often at times in the face of
great skepticism to undertake what were
then ambitious infrastructure projects – the ports of Lamu
and Mombasa, the two standard gauge
railway lines, fibre-networking the entire country, major
highways, etc.
Following the development and adoption of an enabling PPP
framework, the private sector was
unleashed and together with government crafted innovative
partnerships to execute on the various
projects. The government invited the private sector to
partner with it in BOOT partnerships in the
rail and ports and agreed not just to introduce the best
investment incentives for SEZs and industrial
parks but also took the proactive decision to become the
most investor friendly and receptive
Country in the World!
It was the year when even seemingly intractable problems
like insecurity were robustly tackled. The
government having recently commissioned and received
recommendations to reform the Police
Force, appointed an implementation committee and provided
it with the all the necessary resources
to complete the proposed reforms. The Police Service as we
call it now was then trained to handle
all forms of economic crimes under a special unit
operating under it. In this manner all forms of
duplication was removed. The entire Police service was
technology enabled and today they have
every persons full details including businesses run and
assets registers online to such a extent that
the enforcement of all the Government agencies of Kenya
Bureau of Standards, Weights &
Measures, Anti- Counterfeit Agency, the notorious Local
Authorities, City Council Askaris and Anti
corruption Force was now brought under the Highly trained
Economic Crimes Unit which operated
concurrently under the Police Service utilizing the same
infrastructure. The most modern forensic
and crime research labs were opened in Kenya during the
2011 and 2012 and due to these major
reforms our Nation has today become the most ideal place
to stay and invest in and is dubbed as
Crime Free Kenya. In fact this has become a role model in
Africa and the Police Service is busy mostly
training all other African Police Forces.
At KAM’s 50th
Anniversary celebrations, a
commitment was made both by the government and the
private sector to partner firmly towards the achievement
of Vision 2030.
There were some other major early milestones – the
enactment of a modern constitution that over
time entrenched an issue-based, democratic society.
Additionally, the passing of the constitution
afforded Kenya the opportunity for the first time to
undertake bold and far-reaching reforms of the
judiciary and prosecution arms of government. It was with
this act that Kenya converted itself from a
largely distributive and consumption oriented to a highly
productive and efficient society!
Immediately after the new Constitution was accepted a real
sense of urgency had become apparent
and the entire nation went through a rapid change
management era! In the Doing Business Reports
Kenya was lagging behind and in fact in 2010 she was
deteriorating in her rankings – and this was
not because of the Kenyan Government at that time not
making efforts and improving things
around! This was realized when the Government and the
Private Sector starting working together
and they jointly realized that the window of opportunity
was limited with resource rich neighbouring
countries making and executing plans that emulated the
Kenyan plans of becoming Hubs
themselves. It was also simply due to the fact that all
the other African countries were faster in
execution due to the nature of their politics. This is
when all Kenyans started taking bold decisions
which were often made at times in the face of great
skepticism to undertake what were then
ambitious infrastructure projects – the ports of Lamu,
Mombasa, the two private ports, the two
standard gauge railway lines, fibre-networking the entire
country, major 8 lane highways, etc.
As you may recall, in those early days, the question of
land speculators, funding and the culture of
excellence seemed daunting. But we got together and after
the government introduced a firm PPP
framework, the private sector was unleashed and together
with government crafted innovative
partnerships to execute on the various projects. The
government invited the private sector to
partner with it in BOT, BOOT and design build, finance and
transfer partnerships in the rail and ports
and agreed not just to introduce the best investment
incentives for SEZs and industrial parks but also
took the proactive decision to become the most investor
receptive government in the World! Prior
to September 2010, Kenya was very low on Investor
Friendliness. This changed with a complete
change of attitude in the Civil Service and was inspired
by the Leadership! Processing times for
inward investments in manufacturing were radically cut and
the Authorities were given time bound
turn-around times which gave surety to potential investors
that they would get a maximum of 10
days within which their provision of land, incentives,
approvals would be done by the Kenyan
Investment Authority which was given total powers to
process investment applications within 10
days.
All these were built on the gains from Universal Primary
Education. The foresight and determination
in 2003 to ensure access to education for all started the
revolution. In the year 2011 to 2013 a
massive excellence & quality campaign in education was
launched making every school far more
student friendly and committed to producing agile &
competitive young adults with all the values
and virtues and being globally competitive. In Kenya today
in 2030 one of our problems is we cannot
find unemployed youth as most have taken on
Entrepreneurship and for new investments we have
to import cheap labour.
In addition as a country we took advantage of evident
global opportunities. China had been growing
at nearly 10% for more than 20 years and was considered
the manufacturing hub of the world.
However the more China prospered, the more it became
evident that it could not sustain its
manufacturing companies as they were importing all their
raw materials and energy from Africa and
South East Asia and their own people became prosperous and
today they have only expensive
labour. To this end, Kenya positioned itself from 2011 to
2018 to benefit from the shift of
manufacturing businesses of most global companies to
Kenya. We encouraged them to set up in
manufacturing concerns in the Special Economic Zones. The
Government of Kenya has been a key
player in this transformation. Major Iron, Minerals, Oil
and Gas processing and agri-industry along
with all support industries that provide industrial
packaging have been thriving as well as a services
sector that is doing well too.
Public procurement directives given by the President and
echoed by the then Prime Minister went a
long way in reviving collapsed factories.
The 50th
year celebrations in 2010
were held 7 days before the launching of the East African
Common market a move at that time which began as a fast
track project to the then dubbed
COMESA and today referred to as Africa had started this
major shift and transformation of Kenya
into a major manufacturing hub for Africa. What today is
the African Union where trade in goods
and services, and the free movement of capital and people
is assured is the result of the small EAC of
126 million people which now is at a population of 180
million with a GDP per capita of USD 6,000
although we dropped this measure of wealth some time ago.
Becoming the manufacturing hub was not an easy task but we
can proudly boast after so many years
that immediately the SENSE OF URGENCY was realised by the
Political Leadership and the Public
Service Transformation also took place we had a
transformed nation. The entire E-Government
project initiated once we obtained the undersea cables and
the country was linked internally, the
nation took off. Today bandwidth is Free and is used as a
service along with power and water in
every household, it was made an essential service in 2012
and then the journey of connecting every
household thru fibre optics made the distances much
shorter as the world was just “one click away”
and the power of the vote of choice was transferred to the
Citizen with free will to decide. All video,
audio, and global meetings are also held as is everything
now accessed through the Internet where
our own people are using their innovativeness and
creativity. The Government had realised in 2010
that Manufacturing was important and that Competitiveness
was the only Key to use to unlock the
huge potential to create the jobs that Kenya then needed
and that the logistical advantage would
only be leveraged if Kenya was competitive in costs of
doing business and in turn the cost of living.
Industry and our economy benefitted a lot two years ago
when in 2028 we in Kenya hosted the
Olympics for the first time in Africa. Work on it had
started in 2010 when Kipchoge Keino had
unveiled his dream of bringing the games to Kenya. This
was made a real success as our Country had
the highest number of entries. For years now most people
globally knew that no-one could beat
Kenya when it came to long distance running and now they
know who and where Kenya is.
I thank you for inviting me to say a few words and share
my thoughts with yourselves.
>>>>>>>>>>>>>>>>>>>
Your Excellency, I took that approach in preparing my
remarks to demonstrate a few things.
1. Most of the investors already in Kenya are positive
about the country and see a long term
future
2. There are global shifts in production that strongly
favour Africa. It is important for all of us to
work together to pro-actively attract and retain these
investors
3. There’s a big leadership role for Government in
delivering this environment in making some
bold and at times radical decisions.
4. Business remains committed to working with Government
to deliver a better framework for
investors which will ultimately transform Kenya and create
meaningful citizens who can be
proud of living in their Country.
People who elevate the thought, through constant
reflection and be steadfast
in their action, will positively achieve, what they
originally thought.
- Thirukkural (200 BC) 666
Once again Your Excellency President Mwai Kibaki, the Vice
President and to each and every
one of you who are all dignitaries present here today, it
is with profound happiness that I
wish to thank you for gracing our 50 years occasion and
making it a success!
Thank
you.
-http://www.bidco-oil.com/blog/viewpostdetails.aspx?POID=6
