It was a basket of mixed fortunes for garment manufacturing firms based in the Export Processing Zones when Finance Minister David Mwiraria unveiled the country's financial statement.

The apparel firms have been reeling under the weight of ballooning production costs mainly resulting from relatively high wages coupled with high-energy costs, which have fast edged out Kenya from the lucrative US market.

However, the sector received respite when the finance minister revealed the government has applied the brakes on the annual wage increment, which had threatened to drag the firms to their deathbed. He added that future wage adjustments, whether in the private or public sector, will be pegged on productivity and will be adjusted once every two years in line with productivity increases.

He also revealed the government's intention to revive the long neglected cotton sub-sector by injecting 250 million into it, saying that it will go along way in beating the AGOA deadline for local fabric content that is penciled in for 2008.

On the cost of electricity, however, the minister gave the proposal to extend special electricity charges to EPZ's a muted response. Analysts have cited the high cost of electricity as one factor that has contributed in making products from the EPZ uncompetitive in the face of cutthroat competition.

Latest AGOA Trade Data currently available on AGOA.info


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