Kenya’s unproductive service industry was among the top concerns addressed by Dr. Mukhisa Kituyi, UNCTAD Secretary General at Strathmore Business School on 17th May 2016. The public lecture ahead of the UNCTAD 14 Nairobi Conference was a call for the continent’s policy realignment towards the attainment of the 2015 Sustainable Development Goals.
Challenges addressed during the discussion were; the continent’s poor scale of efficient and productive labour force especially in the service industry, depreciating commodity pricing and a declining growth of Foreign Direct Investments.
The global economic recovery since 2008 has been unresponsive, an aspect Dr. Kituyi addressed as having been compounded by the decline of commodity pricing per cycle which is depreciating in a lot of Africa countries.
There has also been a sharp turn down of FDI’s growth rate, a ranging concern for countries highly dependent on such modes of developmental project financing. Africa in 2015 experienced a 31% decline in FDI growth. “There is a significant decline of FDI growth rate in Africa, which cuts across quantity and quality.
The main movement of FDI in 2015 was mergers and acquisitions and not field development projects. Capital projects like infrastructure that are critical enablers to a country’s growth have experienced significant drops, he remarked. “External financing is no longer adequate for dependency and so countries must establish local home grown solutions. These solutions should include expanding the country’s tax base and an efficient tax collection policy,” he added.
He emphasised on the need for countries to improve production capacity and realign policy structures to the active role of innovative development. “The future of Kenya is much more dependent on innovative intelligence to improve production processes than on an inefficient cheap labour force. The growth of artificial intelligence and the visualization of robotics are historic innovations where the dynamics of technology threaten to overrun industries and labour power that are stuck in a routinely way of production,” he concluded.
Dr. George Njenga, Dean Strathmore Business School addressed the role of educationists in promoting a vigorous industrial sector. “The current industrial revolution on robotics and artificial intelligence is an important value addition to the gears of productivity. Universities must formulate strategies which will foster the development of efficient skills crucial to service based industries.”
James Mureu, Director Economic Diplomacy Kenya National Chambers of Commerce urged the business community to take grasp of global trading opportunities which are as a result of the country’s diplomacy dealings, “The Kenyan business community and the private sector at large is going through an exciting phase during which Kenya is actively engaging with the global community on various dimensions. The private sector should take full grasp of the presented opportunities.”
Lazarus Muganda, First Secretary Kenya High Commission Ministry of Foreign Affairs and Foreign Trade, gave insightful remarks on foreign trading policies, mentioning that investment agreements have overtime favored foreign countries unlike the host countries. “We hope that UNCTAD conference will leverage on how better Kenya as a developing country could benefit from investment agreements.”
Watch Dr. Kituyi’s address