HK - Why do Indians (asian) succeed in Kenya manufacturing?

[RV Pundit]

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I was speaking to someone and he intimated they get  - cheap  & really easy financing deals from their mother country - mostly on machinery & equipment & vehicles (ugly Tatas) - and have build a distribution network - retail - of felow Asians. They also take advantage of all these "EPZ" - 5 yr tax holidays and the works.

[vooke]

I also think the culture of cottage industries runs back several generations so they are more at ease with setting up plants and factories plus they have ready expertise from back home.

[Kim Jong-Un's Pajama Pants]

An Indian friend once told me his dad was shopping for cheap used factories in South America to set up in Zambia.  It seems like they have well established global networks.

[Nefertiti]

I think all these facilities, supply chain or ecosystem are available to Kenyans & Africans. The winning factor is a culture of excellence - what we call "mean" or "racist" is just a small bit of it. Mhindi really runs a tight ship - which someone inept or indolent will mistake as racist or mean. Rehabilitate and setup in deadbeat building, bargaining for cheapest supplies, slavish labor, bribe GoK for tax favors, etc.

I was speaking to someone and he intimated they get  - cheap  & really easy financing deals from their mother country - mostly on machinery & equipment & vehicles (ugly Tatas) - and have build a distribution network - retail - of felow Asians. They also take advantage of all these "EPZ" - 5 yr tax holidays and the works.

[gout]

The alcohol drinking culture and the tender culture. The muhindi rarely drink silly thus are able to run/supervise the machines 24-7 unlike Mwafrika owners.
Once a Mwafrika gets a machine running he will spend nights drinking even the monies meant for raw materials. Have seen in it in Ruiru - it is foolish. The machines don't run for long.

Tied to silly drinking is the tender culture where you get more monies supplying air than the products. It doesn't make sense to invest in endless stress, raw materials and labour while you can supply air. When supplying air all you need is  the LPO and make a few calls from your reserved bar stool.

[hk]

I was speaking to someone and he intimated they get  - cheap  & really easy financing deals from their mother country - mostly on machinery & equipment & vehicles (ugly Tatas) - and have build a distribution network - retail - of felow Asians. They also take advantage of all these "EPZ" - 5 yr tax holidays and the works.

Simply Asians are better risk takers than africans. Machines are readily available very cheaply but an african is more likely to invest in real estate, farm or hotel than invest 5m on a machinery. Companies like bidco,chandaria started very small as actually dukawallas then they invested in manufacturing. Investing in manufacturing to create a brand is a little more complicated than real estate. Basically any idiot with money can invest in real estate which is what most africans invest in cause its easier and supposedly "risk free" but manufacturing, technology etc are riskier but with better returns.  And also one of the more differentiating aspect between asians and africans is focus. An asian manufacturer will do one thing really well but an african will be allover the place. 

[Nefertiti]

Simply Asians are better risk takers than africans. Machines are readily available very cheaply but an african is more likely to invest in real estate, farm or hotel than invest 5m on a machinery. Companies like bidco,chandaria started very small as actually dukawallas then they invested in manufacturing. Investing in manufacturing to create a brand is a little more complicated than real estate. Basically any idiot with money can invest in real estate which is what most africans invest in cause its easier and supposedly "risk free" but manufacturing, technology etc are riskier but with better returns.  And also one of the more differentiating aspect between asians and africans is focus. An asian manufacturer will do one thing really well but an african will be allover the place.

CULTURE in a word. Due diligence, focus, integrity, sobriety, etc.

Note the passing on capital, skill, enterprise generation to generation via inheritance. Most of the big companies are run by 3rd generation scions. Mhindi runs family business and is no lone ranger. They have caste, etc but at the family unit things business are really tight, neat and organized.

[vooke]

Simply Asians are better risk takers than africans. Machines are readily available very cheaply but an african is more likely to invest in real estate, farm or hotel than invest 5m on a machinery. Companies like bidco,chandaria started very small as actually dukawallas then they invested in manufacturing. Investing in manufacturing to create a brand is a little more complicated than real estate. Basically any idiot with money can invest in real estate which is what most africans invest in cause its easier and supposedly "risk free" but manufacturing, technology etc are riskier but with better returns.  And also one of the more differentiating aspect between asians and africans is focus. An asian manufacturer will do one thing really well but an african will be allover the place.

CULTURE in a word. Due diligence, focus, integrity, sobriety, etc.

Note the passing on capital, skill, enterprise generation to generation via inheritance. Most of the big companies are run by 3rd generation scions. Mhindi runs family business and is no lone ranger. They have caste, etc but at the family unit things business are really tight, neat and organized.

[Nefertiti]

Simply Asians are better risk takers than africans. Machines are readily available very cheaply but an african is more likely to invest in real estate, farm or hotel than invest 5m on a machinery. Companies like bidco,chandaria started very small as actually dukawallas then they invested in manufacturing. Investing in manufacturing to create a brand is a little more complicated than real estate. Basically any idiot with money can invest in real estate which is what most africans invest in cause its easier and supposedly "risk free" but manufacturing, technology etc are riskier but with better returns.  And also one of the more differentiating aspect between asians and africans is focus. An asian manufacturer will do one thing really well but an african will be allover the place.

CULTURE in a word. Due diligence, focus, integrity, sobriety, etc.

Note the passing on capital, skill, enterprise generation to generation via inheritance. Most of the big companies are run by 3rd generation scions. Mhindi runs family business and is no lone ranger. They have caste, etc but at the family unit things business are really tight, neat and organized.

Part why I prefer a marxist approach - complete with a 5-10- yr marshal plans - than the equality method. Development is darwinian - with hard, cold factors - than what's best for individuals. The state can and should impose a development culture... cos in the 3rd world democracy and laissez-faire are a roadmap to nowhere.

[bryan275]

Simply Asians are better risk takers than africans. Machines are readily available very cheaply but an african is more likely to invest in real estate, farm or hotel than invest 5m on a machinery. Companies like bidco,chandaria started very small as actually dukawallas then they invested in manufacturing. Investing in manufacturing to create a brand is a little more complicated than real estate. Basically any idiot with money can invest in real estate which is what most africans invest in cause its easier and supposedly "risk free" but manufacturing, technology etc are riskier but with better returns.  And also one of the more differentiating aspect between asians and africans is focus. An asian manufacturer will do one thing really well but an african will be allover the place.

CULTURE in a word. Due diligence, focus, integrity, sobriety, etc.

Note the passing on capital, skill, enterprise generation to generation via inheritance. Most of the big companies are run by 3rd generation scions. Mhindi runs family business and is no lone ranger. They have caste, etc but at the family unit things business are really tight, neat and organized.

This is very true.  Once I met an asian in London whose business specialised in transferring family businesses from one generation to the next.

Also the culture of planed machine maintenance, precision manufacturing and quality control come into it. 

The maize fiasco at NCPB depots in north rift exposed us... at what point should we have realised that there was too much maize?  Surely not at the factory gate..heck not even at the farm gate.

As a maize farmer in the region, we produce roughly the same amount every year, there was nothing extra ordinary last year.  I think it was a case of not enough money as opposed to too much maize.

These thieving bastards will finish our beloved nation.

[hk]

Part why I prefer a marxist approach - complete with a 5-10- yr marshal plans - than the equality method. Development is darwinian - with hard, cold factors - than what's best for individuals. The state can and should impose a development culture... cos in the 3rd world democracy and laissez-faire are a roadmap to nowhere.

I thought you were libertarian? Controlled planning of economy would fail in kenya because the incompetence of the planners and executors. Areas where the government has some influence are failing miserably where sectors that are market driven doing fairly well case in point horticulture.  Look at NCPB a monopoly that has ensured that maize productivity per acre hasn't increased because the real market doesn't set the price and thus inhibiting productivity to produce maize at the correct market price. We've tried this government influence in economy for 50yrs and it hasn't worked.
On asians, africans who are already exposed to different cultures or perhaps their parents invested in real estate they should be the ones leading the diversification into other sectors like manufacturing, hightech farming, technology etc. The problem is, this isn't happening as much it should. People are content on just living in the suburbs and driving big vehicles but not to conquer the world. Just my humble opinion.

[Nefertiti]

Part why I prefer a marxist approach - complete with a 5-10- yr marshal plans - than the equality method. Development is darwinian - with hard, cold factors - than what's best for individuals. The state can and should impose a development culture... cos in the 3rd world democracy and laissez-faire are a roadmap to nowhere.

I thought you were libertarian? Controlled planning of economy would fail in kenya because the incompetence of the planners and executors. Areas where the government has some influence are failing miserably where sectors that are market driven doing fairly well case in point horticulture.  Look at NCPB a monopoly that has ensured that maize productivity per acre hasn't increased because the real market doesn't set the price and thus inhibiting productivity to produce maize at the correct market price. We've tried this government influence in economy for 50yrs and it hasn't worked.
On asians, africans who are already exposed to different cultures or perhaps their parents invested in real estate they should be the ones leading the diversification into other sectors like manufacturing, hightech farming, technology etc. The problem is, this isn't happening as much it should. People are content on just living in the suburbs and driving big vehicles but not to conquer the world. Just my humble opinion.

I am a pragmatist. Libertarian works where the culture is evolved. Our culture is rudimentary and the Average Joe is unsophisticated; You have said this yourself. In this scenario benevolent dictatorship is better which is marxist, not libertarian. This is my rationale and not dogmatic "principles" like Kichwa et al.

[Kichwa]

Ohh pliz. Almost anybody can claim they are pragmatists. Its a catch-all phrase.  Ain't we all pragmatists in one way or the other?

Part why I prefer a marxist approach - complete with a 5-10- yr marshal plans - than the equality method. Development is darwinian - with hard, cold factors - than what's best for individuals. The state can and should impose a development culture... cos in the 3rd world democracy and laissez-faire are a roadmap to nowhere.

I thought you were libertarian? Controlled planning of economy would fail in kenya because the incompetence of the planners and executors. Areas where the government has some influence are failing miserably where sectors that are market driven doing fairly well case in point horticulture.  Look at NCPB a monopoly that has ensured that maize productivity per acre hasn't increased because the real market doesn't set the price and thus inhibiting productivity to produce maize at the correct market price. We've tried this government influence in economy for 50yrs and it hasn't worked.
On asians, africans who are already exposed to different cultures or perhaps their parents invested in real estate they should be the ones leading the diversification into other sectors like manufacturing, hightech farming, technology etc. The problem is, this isn't happening as much it should. People are content on just living in the suburbs and driving big vehicles but not to conquer the world. Just my humble opinion.

I am a pragmatist. Libertarian works where the culture is evolved. Our culture is rudimentary and the Average Joe is unsophisticated; You have said this yourself. In this scenario benevolent dictatorship is better which is marxist, not libertarian. This is my rationale and not dogmatic "principles" like Kichwa et al.

[Nefertiti]

Okay I'm a realist, philosophically speaking. I am not very political.

I agree anyone can be pragmatist; there is actually a Mr "Pragmatic" right here - a "new" member - who I suspect is Omollo.

Ohh pliz. Almost anybody can claim they are pragmatists. Its a catch-all phrase.  Ain't we all pragmatists in one way or the other?

Part why I prefer a marxist approach - complete with a 5-10- yr marshal plans - than the equality method. Development is darwinian - with hard, cold factors - than what's best for individuals. The state can and should impose a development culture... cos in the 3rd world democracy and laissez-faire are a roadmap to nowhere.

I thought you were libertarian? Controlled planning of economy would fail in kenya because the incompetence of the planners and executors. Areas where the government has some influence are failing miserably where sectors that are market driven doing fairly well case in point horticulture.  Look at NCPB a monopoly that has ensured that maize productivity per acre hasn't increased because the real market doesn't set the price and thus inhibiting productivity to produce maize at the correct market price. We've tried this government influence in economy for 50yrs and it hasn't worked.
On asians, africans who are already exposed to different cultures or perhaps their parents invested in real estate they should be the ones leading the diversification into other sectors like manufacturing, hightech farming, technology etc. The problem is, this isn't happening as much it should. People are content on just living in the suburbs and driving big vehicles but not to conquer the world. Just my humble opinion.

I am a pragmatist. Libertarian works where the culture is evolved. Our culture is rudimentary and the Average Joe is unsophisticated; You have said this yourself. In this scenario benevolent dictatorship is better which is marxist, not libertarian. This is my rationale and not dogmatic "principles" like Kichwa et al.

[hk]

I am a pragmatist. Libertarian works where the culture is evolved. Our culture is rudimentary and the Average Joe is unsophisticated; You have said this yourself. In this scenario benevolent dictatorship is better which is marxist, not libertarian. This is my rationale and not dogmatic "principles" like Kichwa et al.

What if the leader is "unsophisticated" just like regular joe? I feel that we really don't have  free enterprise system(at least as free as it should be) which is inhibiting growth but at the same time we need to be creating companies that can scale, that's the main thing.

[Nefertiti]

I am a pragmatist. Libertarian works where the culture is evolved. Our culture is rudimentary and the Average Joe is unsophisticated; You have said this yourself. In this scenario benevolent dictatorship is better which is marxist, not libertarian. This is my rationale and not dogmatic "principles" like Kichwa et al.

What if the leader is "unsophisticated" just like regular joe? I feel that we really don't have  free enterprise system(at least as free as it should be) which is inhibiting growth but at the same time we need to be creating companies that can scale, that's the main thing.

Considering the law of averages - its much easier to get a single outlier in a great leader - than the critical mass of industrious folks needed to develop. The Average Joe... what law of environment stops enterprise from building enterprise? which somehow favors the Indian All your examples are from agriculture or real estate  Kenya is an open society - capitalist since colonial times - no socialism like Ethiopia or TZ. For now we are planning manufacturing yet robots & automation are here - where will the jobs come from? We can't have 1940 factories with millions of workers anymore.

As soon as China beats the mid-income chasm it will go more liberal: for now Xi Jin Ping is the new visionary who just extended his term - which is an economic lever.

[hk]

Considering the law of averages - its much easier to get a single outlier in a great leader - than the critical mass of industrious folks needed to develop. The Average Joe... what law of environment stops enterprise from building enterprise? which somehow favors the Indian All your examples are from agriculture or real estate  Kenya is an open society - capitalist since colonial times - no socialism like Ethiopia or TZ. For now we are planning manufacturing yet robots & automation are here - where will the jobs come from? We can't have 1940 factories with millions of workers anymore.

As soon as China beats the mid-income chasm it will go more liberal: for now Xi Jin Ping is the new visionary who just extended his term - which is an economic lever.

I am not making excuses for africans, we aren't investing into the future or venturing to businesses that can scale. However government can help or hurt economy by either taxing too much, deficits that drive high interest or crazy regulations. The point is even indians would be crushing it more if we did something about scope size of government. The good thing of not having legacy systems we can leap forward to robots and automation just like bangladesh is doing https://www.wsj.com/articles/the-robots-are-coming-for-garment-workers-thats-good-for-the-u-s-bad-for-poor-countries-1518797631 since already we aren't even cheap labour countries like ethiopia.

[RV Pundit]

The risk aversion - and maybe the housing deficit - makes building apartment the in-thing. If GOK was to step in big time and build really crazy housing estates - and drive the price down - that would be disincentive to invest in more productive sectors like manufacturing. The same can be replayed in transport - matatus - where Mwafrika likes to invest in. And of course farming.

[hk]

Low productivity is our core problem which has led to high poverty levels. A good article here https://www.economist.com/news/middle-east-and-africa/21738911-africas-economic-paradox-why-africas-poor-pay-high-prices

[RV Pundit]

Interesting article. I think they nailed it.The solution is to apply 5-10 times the fertilizers will apply to our soils and to engage in large scale irrigation schemes.  What they miss is that outside Africa and maybe Asia - most of argicluture is large scale - here in Africa we need to find profitable small-holder models - like KTDA.

Low productivity is our core problem which has led to high poverty levels. A good article here https://www.economist.com/news/middle-east-and-africa/21738911-africas-economic-paradox-why-africas-poor-pay-high-prices