Pan Paper shows Uhuru plan to grow jobs

Webuye Pan Paper Mills. (Photo: Benjamin Sakwa

There are Kenyans who remember Pan Paper Mills when it represented a symbol of our collective national progress.

Webuye, in Bungoma County, was a vibrant town with a population composed of skilled, semi-skilled workers, traders and their families. Over the years, the Paper Mill suffered a number of business setbacks despite successive attempts to revive it.

This took a toll on the economy of the region and impacted the community that depended on it. The business had for close to a decade been strained by debt and improper management that deprived the people of Bungoma much-needed means of livelihood.

Upon assuming power in 2013, President Uhuru Kenyatta directed the Ministry of Industry and Trade to facilitate the revival of this business, while at the same time avoiding the mistakes that had been made in the past.

In April this year, the President announced that the receivers of Pan Paper Mills - PriceWaterHouseCoopers - had reached a decision with an investor to take over this company. They did so with a desire to turn around a then moribund business in the most efficient manner. That decision had an important pillar of the Jubilee administration at its core: industrialisation and job creation especially for the youth and women.

This initiative was also underpinned by the President's desire to empower the private sector to thrive, and facilitate economic recovery to previously less successful businesses in areas that were traditionally thriving.

President Kenyatta has made it clear that he desires to position Kenya as the continent's manufacturing hub, the preferred gateway to Africa for investors and a home to a thriving army of local entrepreneurs.

To do that, Kenya needs to attract more investments and take full advantage of growing demand of manufactured goods being experienced in the Region. Last year, investment levels reached $1.5 billion, a 300 per cent growth since the Jubilee administration took office.

This growth is in line with the goals of the 'Kenya's Vision 2030' which seeks to transform Kenya into an upper middle-income economy driven by Industrialisation and Trade.

This ambition has been a critical pillar in government's strategic focus to reduce the cost of doing business, as well as address challenges in our business environment. In light of this, the Government has put in place an elaborate Industrial Transformation Programme to make Kenya's business sector more productive and globally competitive.

Initial success areas have been realised in improved doing business climate rankings that has seen Kenya ranked as the third most improved country globally for two consecutive years.

Kenya today is home to many multinationals who have chosen our country as their preferred manufacturing hub as well as their regional headquarters.

Manufacturing output over the past year grew by 3.5 per cent, signaling the return of Kenya's dominance in manufacturing in the region. Some of the initiatives that we have embarked on to facilitate production include increasing the supply of energy, reducing its cost, and fast-tracking the Standard Gauge Railway (SGR) project to deal with logistics.

The reopening of Pan Paper, re-branded Rai Paper, marked a major milestone in Kenya's industrialisation journey. At full capacity, this company will employ 2,000 people directly over the next three years. Last week, 500 Kenyans who a few months ago had no source of income are actively employed in this company.

The Pan Paper investor is pumping Sh10b into the plant over the next few years. The investor has committed to give priority to former employees of Pan Paper in building their workforce. And the President, aware that some former employees may not be re-absorbed, directed the National Treasury to make an ex-gratia payment equivalent to three months salary to be paid to all former employees of Pan Paper who lost their jobs at the point of closure of the plant.