The Treasury says in the budget policy statement (BPS) that attracting BPO players will create at least 1,000 jobs while signing up investors for electronics plants will firm up manufacturing.
Under the plan, the government will develop an IT entrepreneurship programme to support the ICT sector and strengthening the innovation ecosystem, including incubators and accelerators.
Kenya is going big on electronics assembling and Business Process Outsourcing in its latest move to create jobs, the recently released draft budget policy statement shows.
According to the document, the government strives to sign at least two investors for electronics assemblies and a similar number of BPO players this year in a policy move aimed at creating jobs and growing the manufacturing sector.
The Treasury says in the budget policy statement (BPS) that attracting BPO players will create at least 1,000 jobs while signing up investors for electronics plants will firm up manufacturing.
Under the plan, the government will develop an IT entrepreneurship programme to support the ICT sector and strengthening the innovation ecosystem, including incubators and accelerators.
The government projects that in five years it will attract at least five BPO players to create up to 10,000 jobs and have phone, laptop and TV assemblers.
This comes at a time the Korean electronics giant Samsung is seeking tax concessions and safeguards against counterfeit imports as a prerequisite for opening a Kenyan assembly plant.
Samsung Electronics Africa President Sung Yoon on Monday said State incentives including tax benefits and blocking the influx of fakes that choke electronics market would enable the company to set up a local production factory cost-effectively.
The Treasury says the plan is to increase contribution of manufacturing sector from 9.2 per cent in 2016 to 15 per cent of the GDP by 2022.
To grow manufacturing in 2018, the government’s priority initiatives include computer, light electronics and IT-related parts assembly.
Under the Vision 2030, Kenya’s anchor growth blueprint, it is expected that access to ICT will contribute to the country’s economic growth by reducing transaction costs and increasing business efficiency.
President Uhuru Kenyatta said his administration will pay special attention to four key sectors which he believes will drive Kenya’s economic agenda in his second term in office.
The youth, he said, will be at the centre of the four pillars plan dubbed the ‘Big Four’ that includes food security, affordable housing, manufacturing and affordable healthcare.
“Other key areas will include investing in ICT, promote ease of doing business, industrial parks/zones and promote market access. Specific measures and incentives will be implemented to boost these sub-sectors and increase job creation,” said the Treasury in the BPS document.
Lack of government support and poor business environment have been cited as key challenges to BPO companies success in Kenya.
In 2010, the BPO industry was thriving but many companies have since closed shop, citing near-nonexistent legal framework and unclear government-led marketing strategy.
“Most BPOs either shut down or sold out operations because they lacked an open mind when dealing with local and international clients as well as industry limitations,” said Vinay Subbaramaiah, the director of BPO/ITES at TechnoBrain.
Mr Subbaramaiah notes that a number of BPOs are forced to undertake marketing on their own to woo clients.
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