Nine-month mitumba import bill hits Sh17.8bn

Hijab on display. FILE PHOTO | NMG 

By CONSTANT MUNDA
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Summary

• Kenyan traders spent Sh17.8 billion on second-hand clothes and footwear imports in nine months through September 2019, fresh official data shows.
• The 6.88 percent growth (Sh1.14 billion more than the same period of 2018) signals elevated demand for footwear and second-hand clothes manufactured abroad amid plans to incentivise struggling domestic leather and textiles industries under the “Big Four” plan.
• This is a further growth over Sh12.82 billion in January-September period of 2017 and Sh12.43 billion a year earlier, data collated by the Kenya National Bureau of Statistics (KNBS) shows.

Kenyan traders spent Sh17.8 billion on second-hand clothes and footwear imports in nine months through September 2019, fresh official data shows.

The 6.88 percent growth (Sh1.14 billion more than the same period of 2018) signals elevated demand for footwear and second-hand clothes manufactured abroad amid plans to incentivise struggling domestic leather and textiles industries under the “Big Four” plan.

This is a further growth over Sh12.82 billion in January-September period of 2017 and Sh12.43 billion a year earlier, data collated by the Kenya National Bureau of Statistics (KNBS) shows.

Expenditure on second-hand clothes, popularly called mitumba, grew by Sh500.9 million, or 3.91 percent in the review period to Sh13.31 billion from Sh12.81 billion in 2018, Sh10 billion in 2017 and Sh9.38 billion.

The import bill for footwear, on the other hand, crossed Sh4.45 billion mark, Sh642.2 million or 16.85 percent jump over Sh3.81 billion in the same period in 2018, Sh3.32 billion a year eralier and Sh3.05 billion in 2016, the KNBS data indicates.

Higher quality and relatively lower prices for mitumba has continued to drive demand for the merchandise at expense of locally-made clothes amid higher margins enjoyed traders largely in informal markets, most of whom evade taxes.

Kenya in May 2017 hastily withdrew from a collective East African Community bloc’s resolution to ban mitumba after American suppliers threatened to match the move with a retaliatory action.

The suppliers had warned of lobbying Congressmen to block Kenya’s duty- and quota-free access to the US market under the African Growth and Opportunity Act (Agoa).

Textile sales account for more than 90 percent of Agoa exports through which Kenya netted Sh68 billion in hard dollars last year, according to statistics by state-run Export Promotion Council.

The lucrative second-hand clothing market has seen traders from China – a major source market – open shops in Gikomba, Kenya’s largest informal market for mitumba, in recent years. This has prompted the country to create a protectionist clause within an investment policy, yet to be rolled out, aimed at identifying sectors which will be exclusively reserved for domestic investors.

Leather, textiles and agro-processing sub-sectors are largely seen as low-lying fruits to jumpstart President Uhuru Kenyatta’s plan to revive and modernise Kenyan factories under the manufacturing pillar of the “Big Four” agenda.

Small-sized factories in leather and textiles business are set to be given incentives under the Big Four agenda such as access to affordable capital through the proposed merger of state-owned development financiers – Kenya Industrial Estates, Development Bank of Kenya, Industrial Development Bank of Kenya.

They are also to be helped in accessing new exports markets and expanding the existing ones largely in Africa through the Integrated National Exports Development and Promotion Strategy, unveiled in July 2018.