Blow for Kenya after electronic firm abandons plans to set up assembly plant in the country
The plant was expected to employ 900 people directly and more than 1,000 in its supply and marketing chains besides enhancing the transfer of knowledge.
Electronics maker Samsung has announced it has abandoned plans to put up an assembly plant in Kenya over fears it would open flood gates for cheap electronic imports.
The company cited failure by Government to put in place mechanisms that would protect local manufacturers from cheap imports.
Sung Yoon, Samsung Electronics chief executive for Africa on Monday said while the Kenyan and regional market offered the firm good opportunities for growth given the adaption of technology, locally manufactured products would be overrun by cheap imports.
“Building a local assembly plant depends on how the Government will protect these investments… there are many products that are coming in without paying the required duties and taxes,” said Mr Yoon, who spoke in Nairobi during a Samsung summit for its local partners.
Kenya does not charge import taxes on electronics such as mobile phones and laptops, a move that was expected to deepen use of technology, however to Samsung this is a Pandora box which would easily overrun locally made electronics.
In 2013, Samsung announced plans to open a television, laptop and printers’ assembly plant in Kenya by end of year positioning Nairobi as the nerve centre of its operations in East Africa.
According to Samsung officials, the plant was initially expected to employ 900 people directly and more than 1,000 in its supply and marketing chains besides enhancing the transfer of knowledge.
However with the latest development, the news is a crushing blow to thousands of Kenyan jobless youths who had anticipated to get jobs but will now be forced to ‘tarmack’ for a few more months if not years until another opportunity arises.
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