The manufacturing sector’s growth can be tracked by the weather patterns, with rain determining the level of expansion.
As Kenya strives to increase the contribution of manufacturing to 15 per cent of the gross domestic product, the Government needs to strategise on boosting the key driver of the industrial sector - agricultural production.
“Manufacturing industry representation comparable to Kenya Association of Manufacturers’ records shows the food and beverages sector has a 22 per cent membership,” a report released by Strathmore University said.
As a share of the economy, the manufacturing sector has remained below 10 per cent since 2015, affected by erratic rains and periods of drought.
According to the Kenya National Bureau of Statistics (KNBS), the sector is estimated to have grown by 3.2 per cent in the first quarter of 2019 compared to 3.8 per cent in a similar quarter of 2018. Failed attempts to save the coffee sector have led to a continued decline of the sector and the sugar importation fiasco in 2017 has left the sectors vulnerable, with companies that process them in decline.
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“In the manufacture of food products, growth was curtailed by the manufacture of sugar, prepared and preserved fish and processing of coffee which recorded contractions in the review period,” KNBS said.
Growth in the manufacture of food products sub-sector was supported by manufacture of bakery products, processing of tea, manufacture of vegetable oils and fats, and beer.
In the first quarter of 2018, the manufacturing sector’s growth rose by one percentage point over a similar quarter in 2017 on increased production in the food sub-sector.
“Growth in the food products sub-sector was supported by the processing of canned fruits, processing of wheat flour and maize meal, manufacture of bakery products, manufacture of sugar and manufacture of soft drinks,” KNBS said.
In the first quarter of 2017, the sector recorded a growth of 2.9 per cent compared to 1.7 per cent in 2016.
Despite the sector surpassing the growth realised in the first quarter of 2016, the depressed performance of the agriculture sector negatively affected agro-processing activities and therefore curtailed the growth momentum in the review period.
The performance of the sector was to some extent dampened by a decline in the manufacture of soft drinks and depressed growth in the processing of wheat and maize flour.
The bulk of manufacturing is driven by agro-processing, which means that a decline in agriculture automatically dooms manufacturing.
