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Economy

Kenya loses Sh70bn in counterfeit trade

Some of the counterfeits drugs estimated to value over Ksh. 5 million shillings netted within Nairobi goes up in flames. Trade in counterfeits has grown into a Sh70 billion annual business, rivalling key foreign exchange earners like tourism, tea and horticulture. PHOTO/ FILE
Some of the counterfeit drugs estimated to value over Sh5 million shillings netted within Nairobi go up in flames. Trade in counterfeits has grown into a Sh70 billion annual business, rivalling key foreign exchange earners like tourism, tea and horticulture. PHOTO/ FILE 

Trade in counterfeits has grown into a Sh70 billion annual business, rivalling key foreign exchange earners like tourism, tea and horticulture.

The Anti-Counterfeit Agency (ACA) said Monday the most affected items were medicinal drugs, electronics, CDs and pirated software, alcoholic drinks, mobile phones and farm inputs.

“The tragedy of the counterfeiting story is that it is an underworld crime that leads to crime advancement,” ACA Chief Executive Officer Stephen Mallowah said during the launch of phase three of its public awareness campaign dubbed “Fagia Bandia”.

The campaign which is conducted in collaboration with US, Britain, India, France and the EAC Member states, seeks to enlighten enforcement agencies like the police, judicial staff and custom officials to lead the fight against counterfeits.

It is backed by private sector lobby groups such as Kenya Association of Manufactures (KAM), Kenya Association of Pharmaceutical Industries (KAPI) and Agrochemicals Association of Kenya (AAK).

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Unilever, East African Cables, British American Tobacco (BAT), Toyota East Africa, Brazafric Enterprises (Kenya), Nokia East Africa, Samsung, HP, Sollatek (Kenya), East African Breweries Limited (EABL), and SCJohnsons are among the firms supporting the campaign.

US embassy officials said American firms – just like Kenyan companies – had suffered from production and circulation of fake goods in the region.

“Kenya has a potential of becoming a great destination for investment. We believe we have picked the right team to help us win the war against counterfeits,” said US Deputy Chief of Mission Isaiah Parnell.
ACA said it had processed 177 complaints since 2010, successfully prosecuting 47 cases worth over Sh650 million.

But even as the agency launches its campaign to rid the market of counterfeits, Kenya’s investment profile is still fraught with reputational risk.

A recent KPMG Fraud Barometer survey which found that African countries including Nigeria, Kenya, Zimbabwe, and South Africa account for 74 per cent of all fraud cases reported in the continent.

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