Budget short puts economic zones at risk

Dr Wilson Songa, the Industrialisation Principal Secretary. FILE 

By EDWIN MUTAI

In Summary

• Huge funding gap, if not bridged, will hinder key development projects including the establishment of special economic zones in Mombasa, Lamu and Kisumu.

The Industrialisation ministry is Sh108.3 billion short of funds required to establish special economic zones and county industrial parks in the next financial year, a Parliamentary Committee has heard.

The huge funding gap, if not bridged, will hinder key development projects including the establishment of special economic zones in Mombasa, Lamu and Kisumu as well as a free trade zone at Dongo Kundu in Mombasa.

“The establishment of 47 county industrial parks will also be affected and this key priority may not be realised,” Industrialisation and Enterprise Development Principal Secretary Wilson Songa told the National Assembly Budget and Appropriation committee on Thursday.

Dr Songa said that the sector has been allocated Sh14 billion or about 10 per cent of its total resource requirement of Sh132 billion.

“This creates a huge resource gap of Sh118 billion. Such a gap will jeopardise the country’s quest for industrialisation by the year 2030,” he told the committee chaired by Mbeere South MP Mutava Musyimi.

The committee is scrutinising budget proposals and spending for 2014/15 as part of the National Assembly’s mandate.

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Dr Songa also chairs the General, Economic and Commercial Affairs sector, which comprises ministries of East African Affairs, Commerce and Tourism and Industrialisation and Enterprise Development.

He said that the sector plays a big role in the economy, contributing about 33 per cent of the Gross Domestic Product. It also plays a key role towards regional integration, poverty reduction and employment creation, he said.

However, the committee questioned why ministries in the sector require more funds yet there is little to show for previous funding.

“The tourism industry has been posting one million visitors annually and not more. The industrialisation docket is nowhere to be felt yet we allocate you money annually,” said MP Mohammed Shidiye.

MP Nelson Gaichuhie, while saying that the sector deserves additional funding, sought to know why the Industrialisation ministry cannot partner with counties in the establishment and running of industrial parks.

“We know that the ministry has some key flagship projects under Vision 2030. But there is need for the national and county governments to jointly undertake projects such as industrial parks,” he said.

Mr Musyimi directed the sector to come up with firm priorities that need to be financed in the next budget for the committee to reconsider increasing the budget.

Dr Songa said the sector is currently building partnership between the national and county governments and capacity building at the local level to ensure success in the implementation of flagship projects and programmes.