Kenya producers association (KAM) cooperates with African Association of Automobile Manufacturers (AAAM) to promote the sustainable development and growth of the automotive industry in Kenya. The partners said that the goal will be achieved through the build-up productionincreasing trade and enhancing Kenya’s global competitiveness automotive industry.

AAAM CEO Dave Coffey predicted that with progressive policies, Kenya’s automotive industry should increase its share in the local and regional market.

“Increased focus on creating value chains and expanding trade will drive automotive demand products of industry. As seen in Morocco and South Africa, a favorable business environment attracts investors who have a thriving automotive industry,” Coffey said.

“Through this partnership, we will work together to increase scale, drive industrialization and deepen localization of goods produced in Kenya’s automotive industry,” Kofi said.

KAM Chief Operating Officer (COO) Tobias Allanda expressed the Association’s optimism that the partnership would give impetus to the automotive industry in the country.

“Kenya’s automotive industry is the most developed in the region. However, it continues to face challenges such as a shortage of skilled labor, low levels of research and development and the lack of long-term financial solutions for the sector that allow investment in technology,” said Hollande.

“Working with AAAM, we will continue to develop an automotive policy aimed at positioning Kenya as a manufacturing and trading hub, integrating the EAC into the value chain and providing market linkages for players in the sector,” he said.

The MoU was signed during AAAM’s visit to Kenya to provide participants with an opportunity to understand the Kenyan automotive industry and provide investor connections. The signing of the partnership comes weeks after KAM asked the Kenyan government to close loopholes preventing producers from benefiting from African Continental Free Trade Area (AfCFTA).

At the time, Hollande observed that while the trade agreement provides the best opportunity to realize the country’s regional, national and business objectives, Kenya has yet to put in place the mechanisms to ensure that the country takes full advantage of the benefits it presents.

“Kenya’s export market in Africa is expected to increase with the full implementation of the AfCFTA. However, if not addressed, issues such as declining national competitiveness, lack of product competitiveness, supply chain constraints, unfavorable business environment, and institutional and infrastructural constraints will prevent local producers from reaping the benefits that come with the AfCFTA.”

Hollande made recommendations to allow Kenyan manufacturers to grow within the framework of the trade agreement.

“At the firm level, the Kenyan business community needs to develop export strategies for various trade agreements including EAC, COMESA and AfCFTA; implement business development programs to enter and expand into new markets and develop capacity to be able to meet the needs of African markets. At the national level, we strongly urge the government to prioritize negotiations on unfinished business; work on competitiveness factors for Kenya to take advantage of the African market and fully implement the AfCFTA National Strategy”.

“We remain aware of the benefits that come from the AfCFTA, such as job creation, movement of goods and skills transfer. This will require harmonization of tariffs, capacity building to meet the requirements for trading in the regime, and simplification and automation of processes. We have also set up call centers at all border crossings to support traders and ensure efficient service.”