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Jua Kali : Kenya's lifeline

Jua Kali : Kenya's lifeline

Source : The Standard of 29 July 2012

When Richard Muteti was appointed to head the jua kali sector, there were no structures and players could not access funding and the right market for their products. He spoke to PETER MUIRURI about the changes he has made in the sector

Walking with Richard Muteti on the streets of Nairobi, one would be mistaken for assuming that he is the city mayor. In every corner that we turned to, he received knowing glances, acknowledging greetings from street vendors, taxi drivers and patrons in restaurants. But then, that is the treatment you expect to be accorded a man who is not only the chief executive officer of Kenya National Federation of Jua Kali Associations, but also the chairperson of Koinange Street Business Association for the last eight years.

In addition, Muteti is the brain behind the Small and Medium Enterprises (SME) Handbook for small business owners in Kenya that was launched by Trade minister Chirau Mwakwere in September last year.

Having worked with the informal sector for some years now, Muteti is zealous about the initiation of projects that will benefit the youth in the country, a passion that was easily discernible as we sat down for an interview recently.

“As head of the jua kali sector in Kenya, my main objective is to bring together all the players in the industry and organise them in a way that will attract funding from both the public and private sector. I also identify markets for finished goods,” says Muteti.

When he entered the sector, Muteti found it in shambles, with the name ‘jua kali’ being associated with failures. In addition, there were many traders in diverse fields who called themselves jua kali with little or no recognition from the authorities.

Small Medium Enterprise

His first task was to streamline the segment by giving a clear definition of what constituted the jua kali sector — either as an artisan or producer. According to Muteti, the sector has been greatly misunderstood, with many linking it to inferior products and those who may have failed to secure the so called ‘good’ jobs. This is a myth Muteti set out to dispel.

He says: “After taking stock of all players in the industry, we came up with at least 18 sub-sectors that represented the different occupations. Some of the groups include jua kali (artisans), small traders (hawkers), service providers (mechanics and repairmen) and agro-based (small farmers). We had to see the sector for what it really is, an SME.”

The odds stacked against him in streamlining the sector were high.

“When I was told to head the sector in 2006, I found a huge office, large parking space but no files or personnel. In addition, there were over 800 jua kali associations strewn all over the country. Nairobi Metropolitan Jua kali Association has 165 primary associations. I had to visit all of them and a get a glimpse of their operations. Then there were the many complaints that the sector produced inferior, poorly designed products. It was so overwhelming that I wanted to resign after only four months in office,” recounts Muteti.

Credit rating system

But he soldiered on, identifying five areas that needed immediate attention. They were: Lack of access to affordable credit to the jua kali sector, lack of proper working sites, lack of appropriate training in one’s area of expertise, absence of a ready market for finished goods and little exposure to the artisans and small traders.

Owing to its nature, not many financial institutions were willing to offer credit to SMEs, terming them unstable. Yet, this was an industry that was contributing almost 20 per cent of the country’s Gross Domestic Product besides being the single biggest employer in the country at over 70 per cent.

“We have since formed a credit rating system to ensure that SMEs get loans from banks without the need for collateral,” he says.

The resilient Muteti approached several government organisations to explore ways of handling some of these challenges with encouraging results. These included Kenya Bureau of Standards, Kenya Industrial Research and Development Institute and Kenya Industrial Property Institute — institutions that have greatly helped in standardising jua kali products, making them locally competitive.

He also arranged to partner with relevant groups in other East African countries in order to expand the market for those in local SMEs.

As he says, there can be no better deal than to link small traders with others in the region. Being the project manager of the East Africa Community Jua Kali Exhibition, Muteti has made arrangements for local jua kali traders to visit each of the East African countries on an annual basis for a learning process.

“The jua kali industry has the potential to earn the country billions in foreign exchange if proper training and funding is channelled to the sector. You will be surprised to know that part of the president’s casual wear was made by a youth from Nairobi through a small

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The Standard, 26 Jan 2013