KAM, KEPSA faults governor Lenku after the attack on Tata Chemicals

In Summary

• KAM says governor Joseph Lenku's action sets a bad precedence against foreign investors in the country. 

Residents of Magadi follow governor Joseph Lenku on March 28 to storm Tata offices.
KAM, KEPSA faults governor Lenku after the attack on Tata Chemicals Residents of Magadi follow governor Joseph Lenku on March 28 to storm Tata offices.

Kenya Association of Manufacturers and Kenyan Private Sector Alliance have condemned Kajiado Governor Joseph Lenku’s “physical attack” on Tata Chemicals last Thursday.

KAM, in a statement, said Lenku’s mobilisation of residents to storm Tata's  Magadi offices flies against the reconciliatory talks on county land rates.

“Whilst, indeed the above-mentioned issue has been a key subject of discussion for both the county and the company, it is vital that appropriate dispute resolution mechanisms are applied for the sake of all parties involved,”KAm said in a statement .

Separately, KEPSA said since  evolution, counties are prioritising the attraction of local and foreign investors to create jobs.

It said recent trends in counties to hike land rates and other levies and charges, are disruptive and discourage investments.

“We ask that this matter is resolved immediately with necessary interventions by the national government and county officials, to restore order and allow the company to continue its operations in the area,” said KEPSA’s statement.

KAM said the concept of devolution was meant to address issues of inequality and equal distribution of wealth, and dispersion of strong industries and long-term investments is very central to achieving this.

It said areas of contention and disputes between Kajiado county and Tata Chemicals are part of a long process to establish working and beneficial partnerships and must be addressed in a manner to sustain investor-confidence in a country or county.

“Actions by the county leadership that we saw being meted on Tata not only disrupt company operations, compromising the company’s productivity but they also send a negative message to investors both local and international about the business environment in Kenya,” said KAM.

The statement further said; “This goes against the spirit of the Big Four Agenda, to raise the quality of life for all Kenyans by ensuring steady economic growth by 2022”.

It said the Kenyan investment policy provides for fair treatment of investors through principles of fairness, transparency, and openness.

“As an association, we call upon the Council of Governors to stand firm against these actions. County governments are a critical stakeholder in providing a conducive business environment for industries to thrive. As such, they should be at the forefront engaging investors, communities and other stakeholders to resolve disputes sustainably. A predictable and stable business environment is critical,” said the association.

On its part KEPSA added that taxes generated by such investments, and even more by the economic activities these investments stimulate, are also the only meaningful way that counties will achieve sustainable financial viability, thereby weaning themselves from dependence on the national treasury for financial sustenance.

“It is, therefore, profoundly shocking and saddening to witness the Governor of Kajiado county lead a crowd into the takeover of the premises and operations of Tata Chemicals Limited, a major business legitimately operating in Magadi for more than a century, and has been the centerpiece of Magadi’s economic development and prosperity,” KEPSA concluded.