President William Ruto is confident that Kenya will become a key industrial hub on the African continent on the back of multi-billion-shilling investments by various manufacturers.
Ruto said this on Tuesday while welcoming a new entrant into Kenya’s Export Processing Zones programme, Nexgen Packaging, which he described as a significant investment that brings the country closer to fulfilling its export objectives.
“This signals the catalytic role of the EPZ programme in driving Kenya’s emergence as an attractive investment destination. It is noteworthy that the textile and apparel sub-sector, Nexgen Packaging EPZ’s chosen area of investment, is now the dominant component of our EPZs, which presently hosts 39 apparel companies with a total capital investment of Sh24.8 billion,” he said at the facility in Mavoko, Machakos County.
The facility in Kenya is Nexgen Packaging’s 19th operation globally.
Ruto further noted that of the 51 Kenyan exporters to the United States that operate in Kenya’s EPZs, textile and apparel sector companies number 29 and employ nearly 60,000 people.
“Not only has the Nexgen Packaging EPZ entered a market with demonstrable present and potential returns, but also it has done so by taking advantage of the highly advantageous, investor-friendly package of fiscal, infrastructural and regulatory incentives to enter a highly promising economic sub-sector.”
The president noted the need to tap into Kenya’s youth, saying they are well-educated, tech-savvy and highly skilled, and are known for their motivation, drive, innovation and entrepreneurship.
He also touted the country, saying, “Kenya’s infrastructure is fairly well developed, with a seamless network of ports and harbours and air, road and rail transport systems covering the entire country. Our information and communications technology infrastructure is also highly developed and complemented by high mobile penetration and internet broadband connectivity.”
According to Ruto, the EPZ programme has made substantial progress in expanding the country’s portfolio of productive capital investments, laying a strong foundation for job creation, technology and skills transfer, diversification, value addition of exports, and the creation of backward linkages within the domestic economy.
“[The 29 apparel companies] have enabled Kenya to export over $7 billion worth of garments to the US duty-free, $545 million of which was exported in 2022,” he said.
Ruto explained that such investments empower Kenya’s apparel sector by developing domestic production of packaging, labelling, and other essential materials.
The implication, he said, is that it will be possible to craft Kenyan-made products, fastened with Kenyan-made zippers, attached with Kenyan-made elastic, and packaged and labelled within the country.
He projected the growth of the textile and apparel sub-sector, based on the current potential and investment growth, saying a compound annual growth of 20 per cent was feasible.
This, he said, would produce over $1 billion in exports and create 200,000 more jobs by 2027, with the figures increasing to $2 billion in exports and 650,000 jobs by 2031, and $3 billion in exports and more than 850,000 jobs by 2034.
