Friday, July 19, 2024 - A steel manufacturer has threatened to shut down its wire plant and consequently lay off 250 employees.
The Kenyan manufacturer penned a letter to the
Kenya Association of Manufacturers stating that the current business
environment presented an unfair competitive advantage.
According to the letter, the manufacturer
lamented that two companies in the country had been exempted from payment
of duty amounting to billions thanks to their connections in President Willia
Ruto’s government.
The manufacturer and others operating in the
industry lamented that the two companies had been importing raw materials
duty-free, for a year an agreement that was not extended to other industry
players.
“If this scenario continues, we will be unable
to compete in the market and will have no option but to lay off approximately
250 workers in our wire division and shut down our manufacturing facility,”
stated the manufacturer in a letter to the Kenya Association of Manufacturers.
A spot-check revealed that the two
organizations gained an exemption of duty from the East African Community
through a gazette notice dated October 2023.
The manufacturers are now claiming
that the billions row with the two organizations will force them out
of business.
Additionally, the steel manufacturers have
continued to raise concerns on how both competitors managed to get an exemption
of duty which did not extend to other players in the industry.
However, the companies have maintained that
their exemption from duty was based on merit.
The shutdown threat comes after a top Kenyan
maize milling factory in Nairobi shut down its operations and put everything
up for sale.
The Kenyan DAILY POST
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