I guess after some more googling we can now proceed at more "informed" level. I don't see how Kenya can become manufacturing export hub. It aint happening in nearly all categories any time soon. Low cost manufacturing (key is LABOUR COST) cannot come here when Ethiopia & the likes are offering 20 dollars per month salary plus other extras..including allowing 14yr old to work. I am not sure where in Kenya you can hire somebody for less than 300-400shs per day (-nearest tea factory in my rural home is paying nearly 500shs per day for factory worker) - except maybe as livin in househelp --where salary is still higher than 20 dollars. The mid & higher level manufacturing is also not happening with electricity cost high and unstable. In any case it cannot happen at scale to meet domestic leave alone export market.
Kenya simply cannot follow Britain, Japan, Asian tigers(South Korea,Taiwan,Singpore,HongKong,Malaysia), China, Vietnam and now Ethiopia model... of manufacturing your way out of poverty.
Kenya is showing lots of evidence that it can follow USA model..manufacturing in Kenya is still a respectable 10% (Ethiopia still at 5%) and has basically kept pace with the rest of the economy. This kind of manufacturing (bar AGOA sweatheart deal) is mainly domestic manufacturing - and that is going on very well ---with improving supply chain-esp with formalization of retail & wholesaling (supermarkets & malls).
The USA model is something I have talked about previously. This is the model kenya can and should pursue to move from low middle income country to middle income to upper middle income and eventually to high income country.The US managed to industralize while retaining high income levels for factory workers (unlike slavish labour in Ethiopia or China for example) by simply focusing on domestic market, improving efficiency and productivity. It also relied on diversified economy - with other sectors of the economy (banking/finances) doing their very well.
Focus on what is doable and we can achieve 10% GDP growth. Kenya solution to mass employment should be the construction industry (both private and public)...and it just need to focus on reducing cost of inputs (cement, steel, etc) and you can employ thousands of people working as construction workers instead of factory workers building houses, offices, malls, bridges, roads, airports, ports and railways. Although manufacturing has really higher multiplier effect, construction industry aint that bad too. If we can move half (30% of kenyans) now involved in back breaking no reward subsistence farming to mjengo jobs..we would be somewhere near middle income.
Ndii say build factories in Mombasa..I say focus on tourism,real estate, holiday homes, fishing and what we can actually do.No chinese company is going to relocate his factory to Mombasa when nobody is wiling to work really long hours for 2,000 shs a month. Certainly we can attract a slice of millions of newly rich Chinese to come enjoy our beaches and hospitality and make money out of our coastline.
This USA model is more what is happening in India,Philiphines, Indonesia, Pakistan,Brazil and such countries.
