The report by the Anti-Counterfeit Agency (ACA) that 80 per cent of electronics sold in the country and 34 per cent of medicines stocked in pharmacies are fake is worrying and a matter of concern to Kenyan consumers, health sector stakeholders and manufacturers.
Several reasons have been cited as being the cause of this menace in Kenya and other developing countries. To start with, emerging economies tend to have infrastructure for large-scale trade but often suffer from governance gaps and lack institutions and enforcement capacity to effectively tackle counterfeiting. Whereas, Kenya has enacted necessary laws, awareness levels on counterfeiting and intellectual property rights is still low.
Secondly, the intangible nature of intellectual assets renders them especially susceptible to theft, particularly through product counterfeiting and digital piracy.
According to the Kenyan Association of Pharmaceutical Industry (KAPI), approximately 30 per cent of the drug market is counterfeit and Kenyans are believed to be spending about Sh4 billion each year on fake medicine. The Kenya Anti-Counterfeit Agency (ACA) believes that as much as 40 per cent of malaria drugs in the Kenyan market are counterfeit.
Counterfeiting also produces knockoffs that endanger lives – auto parts that fail, pharmaceuticals that make people sick, electronics that malfunction, consumer goods with toxic elements, toys that harm children, baby formula that provides no nourishment and medical instruments that give false readings. The Kenya Association of Manufacturers (KAM) estimates that manufacturers incur an annual net loss of Sh30 billion while the government loses Sh6 billion in potential profits and tax revenue due to counterfeits.
Those promoting this illicit trade should know that Kenyan manufacturers spend money not only on manufacturing but also advertising, paying wages and taxes as well as constructing the manufacturing plant and equipping it; counterfeiters incur no such costs and instead free ride on legitimate business’s investments. The pervasiveness of counterfeit and pirated products in the market have seriously affected market share of legally registered businesses in Kenya, and in particular those involved in the manufacture of fast moving consumer goods.
Additionally, the proliferation of counterfeits is also affecting Kenya’s agricultural sector. Counterfeit fertilisers, chemicals and seeds has resulted in decreased agricultural productivity.
Kenyans must be made to understand that counterfeiting, piracy and infringement of various intellectual property regimes amount to theft. Equally, Kenya should introduce and amend laws governing Intellectual Property where necessary.
There is also need to increase public and political awareness on counterfeiting and infringement of Intellectual Property.
The writer is an intellectual property, PR and communications practitioner