Kenya’s creative sector yet to weave into global boom

• Creative goods exports from Kenya stood at Sh4 billion ($40.9 million) in 2013 compared with Sh19.5 billion ($195m) in imports, latest available data by UNCTAD shows.
• Despite the trade imbalance in Kenya’s creative economy, there have been investments into the country’s creative industries both by individuals and by institutions.
• Kenya has more than 75,000 micro and small companies, including fashion designers and tailoring units. An estimated 80 percent of them operate in the informal sector.

The creative economy is on an upswing globally, fuelled by increased spending power of millennials and becoming a key contributor to the gross domestic product.

The size of the global market for creative goods has expanded substantially, more than doubling in size from $208 billion in 2002 to $509 billion in 2015, data by the United Nations Conference on Trade and Development (UNCTAD) shows.

“The creative economy is recognised as a significant sector and a meaningful contributor to national gross domestic product. It has spurred innovation and knowledge transfer across all sectors of the economy and is a critical sector to foster inclusive development” Mukhisa Kituyi, secretary-general of UNCTAD said.

“Whether it be arts and crafts, books, films, paintings, festivals, songs, designs, digital animation or video games, the creative industries are more than just sectors with good economic growth performance and potential. They are expressions of the human imagination spreading important social and cultural values,” said Dr Kituyi.

Global market

But even with the potential of the creatives industry, Kenya and other developing countries are yet to tap into this lucrative global market.

Creative goods exports from Kenya stood at Sh4 billion ($40.9 million) in 2013 compared to Sh19.5 billion ($195m) in imports, latest available data by UNCTAD shows.

Besides the performing arts, visual arts and cultural heritage, Kenyans produce films, videos, television and radio shows, video games, music and books. There is important work being undertaken in the graphic design, fashion and advertising subsectors.

“These creative activities need to be anchored in political and governmental commitment and concrete support,” UNCTAD reiterates.

“Fashion can be a major growth driver. The textile industry is the second largest employer in developing countries, but most artisans are trapped in domestic markets with no links to international trade. In Kenya, like many other African countries, the domestic textile industry has suffered because of the ‘race to the bottom’ by global brands seeking out low-cost labour.”

Well compensated

Despite the trade imbalance in Kenya’s creative economy, there have been investments into the country’s creative industries both by individuals and by institutions.

For these players, it is important not just to grow financially but to ensure that the artisans are well compensated.

“There tends to be a focus on economic growth driven by business growth and investment into financial services, infrastructure, technology and other mainstream sectors,” says the British Council which this year invested in a seed financing facility for cultural heritage businesses in partnership with HEVA fund.

“This can be at the expense of wider society, resulting in already marginalised groups being further excluded and there being little reduction in poverty levels. So there is a need to work for a more inclusive pattern of growth to mobilise the talents of a greater cross section of the population,” the British Council says.

For jewellery firm Kipato Unbranded, which sells locally as well as exports to Singapore, Britain, the US, Australia, Canada, France and Germany, it is important that the artisans, who hail from Kibera, Kawangware and Rongai, earn enough money to sustain themselves.

“Kipato came about because it is the Kiswahili word for income. Where businesses are not mainly focused on ethical consumerism, they produce goods only for profit and the producer, whoever is making your jewellery or your clothes is not getting a fair wage. They end up being squeezed to something really small,” says Kipato founder Marta Krajnik.

“People globally aren’t aware that their purchasing pattern trickles down to the producer. They don’t think about it at the point of purchase. That happens both globally and in Kenya, in terms of awareness of handmade goods especially,” she adds.

“Generally, people are open to paying if you tell them how they are made and where they are made. We want to make sure that the artisans are making a good standard of living based on what they are creating so they are not being taken advantage of.”

According to the UNCTAD report, Kenya’s top export partners for creative goods are Uganda, Tanzania, Sudan, US and Italy. Others include Burundi, Somalia, the DRC, Rwanda and the UK.

Kenya has gained ground to be among the top 10 export partners for countries such as Botswana and Ethiopia.

The value of both imports and exports to Botswana was $0.02 million (Sh2 million) each. The value of Kenya’s exports to Ethiopia was $0.51 million (Sh51m), 1.76 times the value of imports from the country.

However, it also lost its position among the top 10 export partners for Malawi and Mauritius.

Malawi exported creative goods and services worth $0.22 million (Sh22m) to Kenya in 2005 compared to $0.12 million (Sh12m) imports from the east Africa nation. In the same window, Mauritius imported items worth $4.02 million (Sh400m) from the creative industry in Kenya compared to $0.11 million (Sh11m) in exports to Nairobi.

Latest data showed the trade imbalance between Kenya and Rwanda grew 46 times in the period between 2005 and 2014 to stand at $36.92 million, attributable to their growing fashion and design industry.

Garments sector
Fortunately for Kenya, its textile industry is picking up after decades of a slump due to mismanagement and stiff competition from cheaper imports and second-hand clothes (mitumba).

The garments sector in Kenya has more than 40,000 workers, according to a report by development organisation Hivos.

A past study by Hivos and Equity Bank said the textile industry in Kenya is fragmented, hurting its growth. According to the report, most of the local players operate in isolation with no linkages to the retail platform.

Kenya has more than 75,000 micro and small companies, including fashion designers and tailoring units. An estimated 80 percent of them operate in the informal sector.

Last year, the Treasury slapped imported clothes and shoes with higher import duty to protect local companies from cheap imports amidst anxiety that mitumba sellers would lose their jobs.

The new import duty was $5 (Sh500) per kilo (from $0.2 [Sh20]) or 35 percent, whichever is higher.

In the past, the EAC countries have proposed a ban on importation of second hand clothes but backed down after the US threatened to suspend Uganda and Tanzania from duty-free access to the US and Agoa (Africa Growth Opportunity Act). Rwanda currently faces a ban.

Still, institutional partners believe Kenya harbours much potential that requires concrete governmental commitment to drive innovation in the sector.

“Kenya was selected because there is a demonstrable need for the programme, there are strong partnership opportunities and it has the capacity and infrastructure on the ground to deliver the programme in a people-centred way. Also, as an East African travel and technological hub, Kenya is pivotal in other cultural heritage conversations occurring in neighbouring East African countries.

Connecting cultural heritage, creative economy and tourism will — long-term — support the development of an intergovernmental policy framework and highlight the sector’s potential contribution to inclusive growth in Kenya, East Africa and the UK,” says the British Council.

The creative economy is on an upswing globally, fuelled by increased spending power of millennials and becoming a key contributor to the gross domestic product. GRAPHIC | CHRISPUS BARGORETT