Counterfeit goods in local market taking a toll on jobs and economy

Although it is human nature that light is not appreciated until darkness is experienced, the government has taken this theory too far with regard to counterfeits, reacting long after the milk is spilt.

The problem of cheap imports is aggravated by the high cost of production locally. That the government waits for a disaster to happen then react is not new. What is new is the fact that what has been ignored for several years is now taking a toll on our economy.

Forget the fact that we were recently crowned a middle income status. The Kenya National Bureau of Statistics puts Kenya’s unemployment rate at 40 per cent, making it among the 14 countries with the worst unemployment rates in the world out of the 203 countries ranked by the World Fact Book.

Search for jobs
The fact that we have seen Eveready exit and Cadbury announce its intention to quit makes the bad news worse for a country whose youth is largely tarmacking in search of employment.

IMPORT TARIFF

The wake-up alarm has been ringing for too long as government snoozes. One such alarm was sounded by the Kenya Association of Manufacturers way back in 2006 by showing concern over the unusually low import tariff of 12 per cent for the EAC Customs Union which it deemed not to be protective enough compared to other countries like India which is said to be at 60 per cent.

The association recently estimated that some firms have lost up to 70 per cent of their market share in East Africa to bogus products. Even the Kenya Medical Association warning on the use of counterfeit drugs that is causing unnecessary deaths, disabilities and injuries failed to catch the attention of the government.

It would be interesting to hear what the Anti-Counterfeit Agency, the Kenya Revenue Authority and the Kenya Bureau of Standards are doing to curb fake and valueless goods that are not only killing our industries, but also choking foreign manufacturers.

It is not right to let fake goods dominate the market, dilute it with low prices, due to the fact that they are not taxed. Eventually such substandard products drive out manufacturers who have invested heavily in research and hold intellectual property rights.

We need a strategy to reduce the cost of production and protective legislation to cushion our manufacturers. All we see are the occasional raids and token arrests then the story fizzles out, leaving the counterfeit manufacturers stronger and cleverer.

Multinationals like Reckitt Benckiser, Procter and Gamble and Colgate Palmolive have all closed their plants. What will be left if the trend continues?
EDWIN OKOTH, Nairobi