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Kenya's KAM wants ban on EPZ apparel firms's domestic sale

Oct '18
Two months after Kenya granted extension to sale of subsidised fabric in the domestic market, 48 apparel firms are pitted against 17 others registered under the export processing zones (EPZs) in a battle as the decision is perceived as favourable to the latter. The Kenya Association of Manufacturers (KAM) wants a ban on EPZ firms locally selling products tax-free.

At the beginning of the current financial year, Kenya lobbied its partners in the East African Community (EAC) for extending a clause that allows EPZ firms to offload 20 per cent of their annual production free of duty and value added tax in the domestic market.

But KAM, which represents both categories of textile producers, wants the government to stop that as it poses unfair competition to non-EPZ firms and has created an uneven playing field for some, Kenyan newspapers reported.

According to acting CEO and head of membership development at KAM Tobias Alando, the current stay of application in EAC for Kenyan EPZ-based textiles and apparels manufacturers has squeezed the market share of non-EPZ members.

EPZ-based manufacturers employ 52,000 people while the local sector directly employs about 21,000 people in formal sector and more than 30,000 informally, added KAM. (DS)

Fibre2Fashion News Desk – India

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