From Thika to Webuye, the recurrent story of collapsed industries

Magadi Soda Company. PHOTO | FILE | NATION MEDIA GROUP

What you need to know:

  • Today, the tannery’s tall steel chimney, a local landmark for many years, stands above the decrepit, melancholy factory, like a giant symbol of failure and of an industry long gone-by.
  • Thika was supposed to be the natural overspill of the industries that could not be contained in Nairobi whose Industrial Area’s expansion was limited between Jogoo Road and Mombasa Road.

The blue-collar workers who used to flock in droves into Thika’s once-famed Bulleys Tanneries vanished many years ago — into the cavernous wilderness that has today reclaimed this property.

During its pioneer days, thanks to game hunters and livestock farmers, there was no greater symbol of success, and entrepreneurship, than Bulleys and its myriad leather products: belts, handbags, wallets — name it.

Today, the tannery’s tall steel chimney, a local landmark for many years, stands above the decrepit, melancholy factory, like a giant symbol of failure and of an industry long gone-by. Below this monolith on the banks of Chania River, where wattle barks were used to soak the hides for curing, are whitewashed buildings typical of the 19th and 20th century tanning industry.

One of these, the former manager’s office, is now the headquarters of Heaven’s Gate, a local evangelical church while a separate building hosts a music school.

Once upon a time, Thika was Kenya’s industrial hub with a mix of agricultural, auto and fire-belching metal work factories.

Today, some of its deserted factories — victims of rash policies and competition — are a daily reminder of the town’s industrial descent with sections of the abandoned rust-wrecked railway line cutting across private property or vanishing into overgrown thickets. The halcyon days when these rail lines brought people and goods into Thika and sent products into distant markets are long gone.

In their place have emerged residential houses and a few industrial survivors who still take advantage of Thika’s proximity to Nairobi, cheap land, and water.

One of the survivors is Broadway Bakery which has been in Thika for 100 years.

“We have survived this far due to innovations,” says Mr Vimal Shah, the managing director of the family business that opened in 1958 and which is negotiating a Sh1 billion loan from IFC to expand its Thika business.

Thika was supposed to be the natural overspill of the industries that could not be contained in Nairobi whose Industrial Area’s expansion was limited between Jogoo Road and Mombasa Road. Unlike Nairobi, Thika was different. It offered more space, water, and was less populated.
“Until the 1980s land was easily available in Thika and the government used to grant us land too,” recalls Mr Shah.

This was one of the main attractions that drove industrialists to this little town then sandwiched by coffee, sisal and pineapple plantations. There was also a booming population of Asian entrepreneurs who had followed white settlers — the Elspeth Huxley type — and traders such as Jamal Hirji Ojami who established Thika’s first shop in 1914 on the current site of Blue Post Hotel.

Thika boomed as an Asian industrial hub by default. Prior to 1945, the only known Asian factory was owned by Premchand brothers, which manufactured wattle extract from black wattle trees initially introduced as fuel wood for railway steam engines and later as a source of tanning agents.

Novelists, such as Huxley, regarded Thika as a “bush settlement” — the place for small-scale grain milling, sugar and oil refining plants.

It was in mid to late 1950s, the time when Broadways Bakeries was established, that the Asian communities in Thika started consolidating their hold after a policy change. Companies such as House of Manji, East African Match Company, Kaluworks, and Kabazi Canners emerged in major towns.

By this time, and until 1960, Thika was under the Municipal Council of Nairobi, which started encouraging entrepreneurs to shift to the town. It then became a policy and the government started giving entrepreneurs an investment allowance if they agreed to put up industries outside Nairobi. Then, everything fell.
At its prime, Magadi town had an operational railway station, a well-equipped hospital and a popular golf course.

ENVIRONMENTAL DEGRADATION

For more than 100 years, the economy and identity of the town revolved around soda ash mining as Magadi Company and its successor, Tata Chemicals, dredged the beds of Lake Magadi excavating the naturally occurring trona, the single largest such deposits in Africa.

For the last few months, the survival of this town was put into question after the company announced that it would be impossible to get quality soda ash due to environmental degradation in Narok county.

It is a story of deforestation, overgrazing and poor farming practices in both Kajiado county, where the lake is located, and the neighbouring Narok. It is also blamed on the engineering of the Narok-Mai Mahiu Road, which has seen storm waters find their way into the lake.

At the moment, the lake is receiving 8,000 tonnes of silt per hour according to Jackson Muchira, the Tata Chemical General Manager. At that pace, he says, it will take a few years before the entire lake is lost. “This is a national disaster,” Mr Muchira told journalists during a tour.

The silt is impedes the crystallisation of trona which in turn affects the quality of the 320,000 tonnes of soda ash produced annually by the company. Ten per cent of the soda ash is sold locally while the rest is exported and used in the manufacture of glass windows and mirrors.

In the coming years, Magadi town residents will pay the ultimate price since the company subsidises the local Level 4 hospital, supplies water to the community, and for many years supplied cooking gas to families living around the lake to deter them from cutting down trees for firewood. It also runs the morgue and the nearby community cemetery.

BOMING TOWN

The same story is being repeated some 482 kilometres northwest of Magadi at the small town of Webuye where the cost of energy brought down Kenya’s sole paper milling factory. The collapse of Pan African Paper Mills has turned the once-booming town into a near ghost town which remains a case-study on the impact of obsolete technology and high fuel costs.

At its height, the company — whose majority shareholder was Birla Group of India — employed 1,300 permanent employees and 3,000 casual workers.

The factory’s closure led to the shutting of Panpaper High School, Panpaper Primary School, a community dispensary, Panpaper Guest House and a cultural centre.

The plant was first closed in 2009 after the Kenya Power Company disconnected electricity over a Sh100 million bill and with other creditors demanding in excess of Sh7 billion.

Since then, attempts to restart the factory, which opened in 1974, have failed even with the injection of cash by the central government.
When the factory started, it saw the emergence of a town following the influx of more than 1500 workers. It was also expected that the production of paper locally would save the economy £5 million a year in foreign exchange.

Tree farmers were contracted to supply the mills which were also harvesting timber from Kaptagat, Kipkabus, Timboroa, and North Tinderet forests. Another forest was developed in Turbo.

But with the increase in power charges and competition from other markets, local publishers started complaining of the quality of Webuye paper and the pricing which was above world levels.

Some 30 years ago, the then managing director, Man Biyani was warned that they would have to give local users a fair price. “We would close down,” he told a journalist. And they did as customers looked elsewhere.

Panpaper was an energy-intensive plant and could not compete with government subsidised mills in other countries and a general decline in wood-based products. For years, the investors complained that duty paid on locally made paper was too high and made the price of Webuye’s paper expensive than imported paper. Panpaper had two machines — both provided by UK’s Beloit Walmsley and producing unbleached kraft paper used for packaging and wrapping, and one producing bleached fine paper grades used by the printing industry and as tissue paper.

Although the government paid Sh1.2 billion in 2013 in a bid to reopen the factory, the rise of computers and the internet has reduced the need for paper as major consumers turn to new technology including digital media.

In other countries, pulp and paper mills are turning to packaging materials and sanitary products – apparently what Webuye was doing – and which is now the most promising segments for growth. But competing with some of the world’s most established manufacturers will be a Herculean task.

UPMARKET BEEF

Another factory that has defied revival is the Kenya Meat Commission, which has been unable to match the private abattoirs in Nairobi’s Njiru and Dagoretti. After pouring millions of shillings to sustain this investment, KMC has been closed — for the zenith time — after it was unable to attract new markets. It also had problems paying farmers and creditors.

The story of KMC is the story of mismanagement and lack of foresight. Initially a monopoly, and relying solely on big ranch farmers, the company started facing problems in 1970s after the late Gerishon Kirima, the first chairman of the Kenya National Butchers Union, approached President Jomo Kenyatta and sought permission to sell meat in Nairobi from African-owned abattoirs. KMC continued to operate like a monopoly, even with the collapse of big ranches.

When it was started by the Kenya National Farmers Union, KMC disregarded African stock owners and by late 1970s, when most of the white farmers had left, it found itself with few suppliers with most locals turning to abattoirs run by Kirima as KMC concentrated on “upmarket beef”.

Later it would be used as government’s answer to drought and was forced to purchase and slaughter weak animals from pastoralist communities.

Today, KMC is Athi River town’s symbol of failure — even though it is the most modern licensed export abattoir in East, Central and the Horn of Africa.

Opposite Nairobi’s General Service Unit headquarters is yet another failed enterprise which is Thika Road’s eyesore for years now: Allsopps Brewery.

Initially known as Taylor’s Brewery, this was Kenya’s second brewery and had been started by Nairobi entrepreneur Mark Taylor to rival Hurst brothers’ Kenya Breweries.

Unable to break even, the company was sold to Ind, Coope and Allsopps in 1948 and started brewing the White Cap and Pilsner lager. The company, together with Kenya’s third brewery, City Brewery, would all be taken over by Kenya Breweries to operate under East African Breweries.

City Brewery, then based in Industrial Area, were the makers of City Lager, Tavern Brown Extra Ale, City stout, and Jambo.

Over time, and under the chairmanship of John Fenton, City Brewery had expressed concern about the growth of non-excisable intoxicating drinks “which are often brewed in the most deplorable conditions”.

Rather than wind up, City Brewery sold its assets to KBL.

Today, the remains of Allsopps Brewery is the grey-stone ruins near the entrance to Ruaraka.

Many others have been on this route, and each with a different story: the National Pencil Company Limited which produced Diamond brand of pencils, crayons, and coloured pencils from Nyahururu; East African Records, the only record pressing company in Kenya by 1990s and Juja’s East Africa Bag and Cordage – a victim of cheap exports.

At their prime, these companies boomed – now they are fading away – or remain as memories.

Mr Kamau is the Acting Editor, Investigations and Special Projects. Email: [email protected]
. @johnkamau1