Nakuru Governor Lee Kinyanjui has hit out at the national government for awarding contracts to foreign companies at the expense of locals, many of whom he said have now been pushed out of business.
Mr Kinyanjui said this during a press conference on Wednesday in a hard-hitting statement directed at the Jubilee administration headed by President Uhuru Kenyatta and his deputy William Ruto.
“It is sad that multi-billion contracts are all warded to foreign firms that have also been given preferential preference and incentives yet they don’t play tax. The government is busy humiliating Kenyan contractors who at the end of the day pay taxes to it. Where on earth can a government do this and then come back to claim that it is facing an economic downturn?” posed Mr Kinyanjui.
Governor Kinyanjui said it is disheartening that Kenyan contractors, after paying all their taxes, have been side-lined by the government which gets the money from them.
“All major contracts in Kenya are in the hands of foreign companies. If you look at any major road construction, it is in the hands of foreigners. Dams and railways are all in foreign [hands]. The sum total of all those contracts is about 70 percent undertaken by foreign companies,” said Governor Kinyanjui.
He said that with this trend, it will take years for Kenyans to feel the benefits of their economy.
“When will Kenyans enjoy the benefits of their own economy if the country continuous to give preference to foreign companies? What will happen to local companies that have invested here for so many years?” wondered Mr Kinyanjui.
He added that in some instances, the companies are given a duty waiver on their equipment.
“The same foreign companies are given very preferential treatment. Many of them do not pay duty. They import all their equipment duty free so they have to come here and compete with local companies that have to pay duties,” said Mr Kinyanjui.
He added that some companies have formed a habit of not paying levies to county governments in areas they are operating from.
“There is no country that gives preference to foreigners over and above their own contractors,” said the governor.
Mr Kinyanjui cited some big buildings in the country which were built by local companies in the early 80s and are still standing tall, “yet the government cannot recognise this”.
“There are major buildings in Nairobi built in the 80s, 90s and 2000s that were done by the local contractors. An example is the NSSF Building in Nairobi that was done by Mugoya Construction Company, We had Nyayo House and other buildings – they were all done by the locals. We are killing our local industry by giving preference to foreign companies and as a result of that we are killing our own economy,” he said.
The governor called on the government to reveal the contracts given to foreign companies.
"Continuous preferential treatment for foreign companies is a threat to national interest. We challenge the government to publish all contracts awarded to foreign companies," he said.