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KENYA AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March 2015 0 Margaret Waithaka Export.

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Presentation on theme: "KENYA AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March 2015 0 Margaret Waithaka Export."— Presentation transcript:

1 KENYA AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March Margaret Waithaka Export Processing Zone Authority Margaret Waithaka Export Processing Zone Authority AFRICA GROWTH AND OPPORTUNITY ACT (AGOA) AND AFRICA AS A SOURCING AND INVESTMENT DESTINATION

2 KENYA INTRODUCTION TO KENYA (1) AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March Centrally located Regional Hub Globally connected 4 weekly direct flights (KQ) to Guangzhou

3 KENYA INTRODUCTION TO KENYA (2) AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March PoliticalDemographic Democracy with New Constitution (2010) Population 43 million Jubilee Govt. of President Uhuru Kenyatta since 2013 Rapidly urbanizing, 2.7% annual pop. growth rate Two levels of Govt. – national + 47 county governments English as official language Politically stable – elections every 5 years, only 4 Presidents in 51 years. Sustained investment in education, literate population Vision 2030 Economic Blue Print325,560 students in universities

4 KENYA INTRODUCTION TO KENYA (3) AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March Economic Indicator GDP ( US$ million, 2013)55,243 GDP Growth rate (2013)5.7 % Inflation Rate (2013)5.7% Total Exports ($ million, 2013) 5,834 Globally 7 out of 10 fastest growing economies are in Africa.

5 KENYA KENYA-CHINA RELATIONS China fourth to open embassy in Kenya after Independence His Excellency, President Uhuru Kenyatta visited China in 2013, held talks with His Excellency Xi Jingping and signed deals worth US$ 5 billion Chinese Premier, Mr Li Keqiang, visited Kenya in multi-billion shilling infrastructure deals signed Major infrastructure projects in Kenya executed by Chinese companies – Lamu Port Project, Airport Expansion, Standard Gauge Railway, Major highways AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March

6 KENYA KENYA’s ECONOMY AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March

7 Africa’s Apparel Sector exports to USA under AGOA (2014) US $ million AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March KENYA – LEADING SSA EXPORTER TO USA (US$ 379 million)

8 AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March KENYA TEXTILE ADVANTAGE (1)- COST EFFECTIVE LABOUR CATEGORY OF WORKERCITIES (US$ PER MONTH) RURAL TOWNS (US$ PER MONTH) Machinist15092 Machine assistant11558 Workforce with good English language and Mathematics skills 87 % literacy levels and 100% primary school enrollment Good work ethic, adaptable, trainable Government supported skills training for clothing industry 30 universities and over 100 vocational training institutions around country

9 AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March KENYA TEXTILE ADVANTAGE (2)- TAX BENEFITS TO INCREASE PROFITS 10- year Corporate Tax holiday and 25% corporate tax for next decade 10 year Withholding Tax holiday for payments to non-residents e.g. dividends, license fees, consultancy charges Exemption from Import Duty, Excise Duties and Value Added Tax on machinery, building materials, raw materials, inputs, contracts, supplies and services

10 AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March KENYA TEXTILE ADVANTAGE (3)- MARKET ACCESS AND SPEEDY HANDLING Single License Issued by EPZ Authority Accelerated approvals Fast Track Import/export facilitation at Port and inland Customs, Immigration and Utility Facilitation Duty Free Access to US Market under African Growth and Opportunity Act for 6,000 products including clothing and textiles (can use non-African fabric and stitch in Kenya) Duty free access to European Union market under Economic Partnership Agreement (can use non- African fabric and stitch in Kenya) Preferential duty on sales to COMESA member states

11 AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March KENYA TEXTILE ADVANTAGE (4)- COMPETITIVE INFRASTRUCTURE & ENERGY Lower electricity cost for textile, apparel and leather industry (US $ 0.09 per Kilo Watt Hour) Serviced land with water, electricity, sewer and roads in EPZs Land rent US$ 5,000 per hectare (10,000 sq meters) per year or pay once at US$ 100,000 Up to 50 year leases on land Ready factory buildings, warehouses and office of many sizes (600 sq m to 3,000 sq m) for lease Rental US$ per sq m per year for buildings Cluster of support services and accessories – buying houses, zips, washing plants, chemicals

12 AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March KENYA TEXTILE ADVANTAGE (5)- SUMMARY  Politically stable strong economy  Top exporter in SSA to US market under AGOA  Preferential market access arrangements  Differentiated wages depending on location  Government focus  Attractive incentives  Green channel at ports  Lower power costs  Well established textile and apparel sector  Highly productive educated labour

13 AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March KENYA TEXTILE ADVANTAGE (6)- INVESTMENT OPPORTUNITIES TO MEET INCREASING DEMAND AND PROVIDE JUST IN TIME INPUTS, INVEST IN: Textile Yarn units to produce Man Made Fibre and Cotton Yarns and threads Textile Mill investment to product knit and woven fabric to meet demand of apparel exporter Accessory production plants to supply buttons, chemicals, zips and labels for apparel sector TO EXPAND OUR EXPORTS OF FINISHED GARMENTS, INVEST IN: Apparel stitching plants to export to USA and EU as well as regional COMESA market Buying houses

14 AGOA and Africa as a Sourcing and Investment Destination. EPZA Kenya - InterTextile Shanghai Apparel Fabrics 19 March KENYA TEXTILE ADVANTAGE (7)- OUR CONTACTS: Chief Executive Export Processing Zones Authority Athi River EPZ, Off Namanga Road P.O. Box Nairobi, Kenya Tel: , Website: THANK YOU!


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