Ruto Bags Ksh1.5 Billion Deal With US To Boost Clothes Industry

President William Ruto on Tuesday, April 23 announced a partnership worth Ksh1.5 billion ($11 million) between Kenya and the United States to boost the textile and apparel sub-sector.

Ruto was speaking in Machakos County during the Commissioning of Nexgen Packaging Kenya EPZ Limited in Mavoko where he stated that the deal would create more jobs for factory workers.

He added that the partnership would expand the country's fashion industry as well as give the country a competitive edge by attracting investors who would play a big role in growing its manufacturing base.

The deal will also see the introduction of new vertical integration capabilities to the textile subsector and will focus on assisting over 40,000 cotton farmers to increase cotton production and ultimately textile production.

President William Ruto speaking to workers at Nexgen Packaging Kenya EPZ Limited in Mavoko, Machakos County on April 23, 2024. /PCS

"Our strategic interventions in the textile and apparels sub-sector have provided Kenya with a competitive advantage, attracting investors and growing the manufacturing base. This has not only led to increased exports, but also expanded job opportunities for factory workers and over 40,000 cotton farmers.

"An $11 million partnership between Kenya and the United States will boost the textile and apparels sub-sector to a new level," announced the President.

Ruto asserted the government's commitment to realizing the textile and apparel sub-sectors' full potential through enhancing quality control and promoting economies of scale, noting that fabric production will be pivotal in giving Kenyan-made apparel the potential to be prominently marketed abroad.

“Such an investment would be particularly opportune, with the potential to increase the number of farmers and acreage under production to achieve at least 260,000 bales annually,” Ruto stated.

He also disclosed that the government has increased acreage under cotton from 44,000 acres last year to 104,000 acres this year as part of efforts to increase local fabrics.

In the same vein, Ruto announced that the government would introduce special electricity tariffs favouring the country's manufacturing industry, revealing that manufacturers operating at night will be getting their power at 50 per cent of the normal rate.

The new directive, according to Ruto, would allow manufacturers to work during the off-peak hours and take advantage of power production that occurs when Kenyans are generally asleep.

"I have already announced today, that for use to help our investors, those who work at night will have their power bills charged at 50 per cent. This will ensure that we get night shifts and create opportunities for Kenyans," he stated.

"We've done away with the requirement that one must use power to full capacity during day time to benefit from reduction at night."

The new tariffs take effect from the beginning of May 2024. Kenya Power has been applying subsidised tariffs for companies operating at night.

The Time of Use (TOU) are usually applied from 10 pm to 6 am on weekdays, with the tariffs also applying to companies during the whole day on Sundays and on public holidays.

Workers at the Nexgen Packaging Kenya EPZ Limited in Mavoko, Machakos County on April 23, 2024. /PCS