The Treasury has conceded that cunning and dishonest local suppliers are undermining a government directive mandating public agencies to procure at least 40 percent of their consumable products locally.
This has further impeded the creation of new jobs for the burgeoning skilled youth population.
In its latest policy statement, the Treasury revealed that the ‘Buy Kenya, Build Kenya’ initiative, initiated nearly a decade ago, has fallen short of its intended targets in public procurement.
“The challenge to achieving a 40 percent local content quota in government procurement is that local merchants are supplying imported products once awarded contracts,” stated the 2024 Budget Policy Statement.
According to the policy, which followed a presidential directive in June 2015, a minimum of 40 percent of supplies to State ministries, departments, and agencies should originate from local companies.
However, local manufacturers have voiced grievances over the years, alleging that domestic suppliers often present samples of local products during tendering, only to source the same products from cheap manufacturers from India and China upon securing the government contracts.
The government remains the largest purchaser of goods and services from the private sector. Last year, imports categorized as government supplies amounted to Sh62.08 billion, as per provisional trade data from the Central Bank of Kenya (CBK).
The competitiveness of Kenya’s manufacturing sector has been inadequately addressed by successive governments. Despite previous administrations promising to promote the local manufacturing sector, Kenya remains a net importer.
