The government has started talks with local edible oil refiners in a bid to defuse a row over the State’s decision to import the product duty-free.
Officials from the Ministry of Trade and Investments have since last Tuesday been visiting factories of refiners including Bidco Africa and Golden Africa to establish the factors behind the high retail prices.
This comes at a time the Law Society of Kenya has filed a suit against the government over plans to import 125,000 metric tonnes of cooking oil duty-free, warning the decision will be detrimental to local manufacturers.
“If the government goes ahead to do it then the effect will be detrimental, from the jobs at our factories to high prices of goods such as soaps which we locally make as part of the crude palm oil that we import,” Golden Africa managing director Fathi Hayel Saeed said.
Government representatives drawn from the Ministry of Trade, Kenya Development Corporation and KenInvest on Thursday toured Bidco Africa’s plant in Thika, coming a day after a similar visit to Golden Africa.
Bidco asked the State officials to streamline the operating environment by retooling the tax regime to bring down the cost of production, especially the cost of power.
“We pay quite a number of taxes to import our raw materials and require support in the harmonisation of these taxes to enable us to export to bring dollar earnings to the economy,” said Bidco group director Chris Diaz.
The manufacturers are also seeking government assistance to get access to dollars at friendlier rates.
Investment and Promotion representative Leonard Mambo said the facility tours are part of plans to ensure sustainability in the sub-sector.
“The best way to do this is by cutting out reliance on importation and that’s why we have come to the factory to try and understand their challenges,” he told journalists.