Kenya’s National Treasury, on recommendation from the Ministry of Trade and Investment, introduced a 10% Export Promotion Levy on clinker as a solution to Kenya’s limited forex outflow and the high trade imbalance as part of the new administration’s budget announcement.
But some cement manufacturers are concerned that the levy will create a monopoly in the industry, as there are very few Kenyan cement manufacturers that have the capacity to manufacture clinker domestically. This will force them to either buy the product from rivals or import expensively – subsequently passing the cost on to the consumer.
In a presentation to the Finance and National Planning Committee at the end of May this year, Cemtech (a subsidiary of the National Cement Ltd, Kenya’s biggest cement producer) suggested the levies could go further – to 25% or more and fixed for a minimum of 15 years. “This is the