The government will import large quantities of rice, cooking oil, sugar, wheat and beans duty-free through the Kenya National Trade Corporation (KNTC). FILE PHOTO | AFP
The move to allow the State-owned Kenya National Trade Corporation (KNTC) to import large quantities of rice, cooking oil, sugar, wheat and beans duty-free in order to fight inflation requires clarity.
First, how will the commodities flow through the supply chain to reach households given KNTC's lack of solid linkages with wholesalers and distributors?
Secondly, how will the State ensure that the duty-free products reach homes at the targeted lower prices?
There are risks that middlemen could profit from the duty-free importation plan and generate outsized profits at the expense of poor consumers.
The plan has caused disquiet among manufacturers and food processors who are yet to determine how they will fit into the State’s intervention in the supply chain.
Ideally, the State would have tapped a few local manufacturers through competitive bidding and allowed them to sell the products at subsidised prices through a government-controlled scheme.
Previous attempts by the government to enter the business space have ushered in corrupt dealings.
The move is already causing jitters among some companies who argue that imports are meant to kill the local industry, which cannot compete with cheap goods from abroad.
PAYE Tax Calculator
Note: The results are not exact but very close to the actual.
