Comesa links up SMEs with big firms to boost trade

Regional business lobby is seeking buyer agreements for small agriculture and food suppliers with big firms across East and Southern Africa to boost regional trade.

Entry of global businesses into the region has not significantly boosted the local producers with some of the multinationals preferring to source outside the region.

Common Market for Eastern and Southern Africa (COMESA) Business Council which is conducting training for Small and Medium Businesses this week in conjunction with the Kenya Association of Manufacturers says this could be bridged by improving standards of local suppliers and linking them with big firms.

COMESA Business Council (CBC) boss Sandra Uwera said that the agriculture and food supplies industry had become very liberalized and borderless big businesses had the options of sourcing suppliers outside the region.

“Today, more experienced international businesses have a first mover advantage and seize the opportunities that come with being a part of a supply chain business process,” Ms Uwera said.

Some international companies who have set up food business in the country have been complaining that the inability by Kenyan producers to meet the stringent standards of their chain of business has been a major problem.

Kentucky Fried Chicken (KFC), Subway, Ocean Basket, Cold Stone, Domino’s, Naked Pizza and Spurs are the major food firms with outlets in the country.

IMPORTED FROM EGYPT

KFC Kenya, run by Kuku Foods Kenya, sources most of its products locally except their potatoes which are imported from Egypt.

CBC’s 2016 training attracted over 80 local food suppliers and are being trained by a reputable regional firm –Phyto Solutions and the COMESA Expertise on Standards and Food Safety Systems.

The lobby urged the traders to adopt standards to take advantage of the expanded markets and pacts with huge suppliers.

The Council says that a Memorandum of Understanding (MoU) will collaborate and ensure that the trained SMEs are integrated into their procurement contracts.

Ms Uwera said that they have already signed buyer agreements with Serena Uganda and Rwanda, BRALIRWA –Rwanda.

She stated that CBC will also sign memorandum of understanding with local buyers like Serena Hotel –Kenya and Uchumi supermarket.

According to CBC, the percentage of intra COMESA trade to total COMESA trade has only increased by 2 per cent since 2005.

Trade between the regional countries stood at $23 billion in 2014, this was a growth from 5 per cent in 2005 to 7 per cent.

This is despite the fact that COMESA carries a large market of the African continent with an estimated 480 million consumers and a total trade of $307 billion in 2014.

“With these statistics in mind we must recognize that the regional trade agenda seeks to promote a larger consumption of our own goods and services and so we must increase intra COMESA trade,” the CBC boss said.

Ms Uwera advised the traders to work within the dynamics of speed in the market to market meet the highly competitive market.