Insights from the Jua Kali Sector
I recently held a meeting with the Chairman of The Jua kali Association (Kamukunji), Mr Eliud Mbiyu in Nairobi to find out what growth opportunities lie in their way and the challenges they face when trying to achieve these. The association is a non-profit umbrella body that consists of 4,000 members from micro and small businesses predominantly dealing in metal works, blacksmiths, welders and fabricators.
Their greatest strength was the Sacco they had formed which provides its members with loans to further their business activities. The Sacco encourages its members to save money as a means of building and encouraging a savings culture. Most of its members are drawn from poor backgrounds who basically live from hand to mouth. A huge advantage of coming together is that they are able to source and service big orders which they achieve through a system of division of labour to its members. The challenge in this is that most of the work done is usually not of the same standard.
He added that the setting up of the Micro and Small Enterprise Authority (MSEA), which operates under the Ministry of Industrialisation has gone a long way in assisting them to achieve their goals which include sourcing of business, mediation of disputes that require government intervention and interacting with various government institutions such as the National Hospital Insurance Fund (NHIF), the National Social Security Fund (NSSF) as well as the County government of Nairobi. MSEA has for example, played a major role in assisting the association to attain the title deed for the two acre piece of land on which they operate.
The main form of training undertaken by businesses in this field is apprenticeship, as most of those joining this field of work have not attained basic education qualifications. This manual handcrafted labour needs to be improved through the introduction of new technologies such as mechanisation, as the former makes them underproductive and as mentioned earlier, leads to the production of unstandardized products. In this sense, due to the investment required in terms of machinery, there will be need to train the artisans on how to use the machines.
Another challenge that the association faces is the sourcing of finances from financial institutions. This is in part due to the lack of financial skills by the businesses they represent as most do not keep records of their day to day operations. Their main source of revenue is the membership fee paid by its members and proceeds that they get from leasing out a hall on their premises for meetings. He pointed out that due to the fact that they are an underfinanced organisation, they have a problem attracting and maintaining quality employees.
Moving forward, Mr Mbiyu pointed out that some of the key areas that the association needs to focus on include offering financial training for the businesses under their umbrella, upskilling for the artisans so as to improve the quality of their products, exchange programs that will equip the artisans with modern technologies and a stern approach by government when it comes to dealing with unfavourable competition from cheap imports. Despite the challenges they face, he was optimistic of the future of the sector due to the positive feedback that they have gotten from the national government in projects that they are undertaking which include plans to build a business complex. “There is a great need for a change in perception of the Jua Kali sector from one that produces inferior quality products to one that can be seen as a key instrument to achieving Kenya’s Vision 2030 Industrialisation plan”
Informal Economy Analyst