Benson Kathuri
26 June 2007
Nairobi — At least two million plastic bags are handed out each year to people shopping at supermarkets and kiosks in Nairobi alone. File Picture
An estimated 4,000 tonnes of the thin plastic bags -'flexibles' - are produced each month in Kenya, mainly as standalone products for shopping purposes but also for packaging products like bread. About half of them are less than 15 microns thick and some are as little as seven microns thick.
The plastic manufacturing sub-sector is booming with growth estimated at between eight and ten per cent a year. Their market extends to the East African Community and beyond with Uganda being the biggest consumer.
The effects of their growth are, however, evident across the country as used plastic bags litter the environment almost everywhere.
Two years ago, former UN Environment Programme (UNEP) Executive Director Dr Klaus Toepfer said waste problems was not just a problem for the country but was increasingly becoming a problem worlwide, particularly in developing countries.
The organization engaged two public research experts from the Kenya Public Policy and Research Analysis (KIPPRA) to conduct a study on plastic use in the country.
The researchers Dr Moses Ikiara and Mr Clive Mutunga recommended a seven-point plan for tackling plastic bags in Kenya. It included a ban on bags of 30 microns or less, consumer and anti-littering campaigns and a plastic bag levy collected from suppliers with the costs passed on to the consumer.
Industry failed to self-regulate
The recent drastic action by the Government, analysts say was not expected mainly because the industry had failed to regulate itself and reduce the environment-polluting plastic bags.
"How many people in this country have not abused the plastic bags simply because they are too cheap and nobody feels the impact?" asks Ikiara, a public policy analyst at the Kenya Institute of Policy Research and Analysis during an interview with the FS.
According to the analyst, the manufacturers failed the test and since the writing was on the wall that something drastic must be done to reduce the use of the plastics. They said the levy would be partially targeted to support the development of environmentaly-friendly bags such as cotton ones which would have the double benefit of helping Kenya's cotton agriculture and industry. They also proposed a plastics levy management committee, set up and chaired by National Environmental Management Agency (NEMA) to manage and implement the new measures.
The report's findings were based on the outcome of several meetings between UNEP, NEMA, manufacturers, suppliers, supermarkets and other interested groups held in Kenya and abroad. The conclusions and recommendations are also based on lessons learnt from waste management schemes introduced elsewhere.
With manufacturers shouting down a Budget proposal to impose a 120 per cent excise tax on plastic bags and sacks, there are calls from other Government officials for a longer transition period. Picture By Martin Mukangu
But this now might never happen and the people must wait and assess whether more money would be channeled to the Environment ministry to tackle the plastic menace.
The 120 per cent excise tax imposed on plastic bags become effective in October and Finance minister Mr Amos Kimunya is expected to collect billions from the consumers.
Manufacturers want levy introduced
According to Kippra report, at least two million plastic bags are handed out each year to people shopping at supermarkets and kiosks in Nairobi alone. "With the exception of some paper bags, there are hardly any alternatives to plastic shopping bags. Shopping bags made from natural products are available in the market but are hardly used because of the easy and free availability of plastic shopping bags in market outlets and the low price which they are sold in outdoor markets."
The Kenya Association of Manufacturers (KAM) the umbrella body for the manufacturers, including plastic bags makers wants the tax suspended for good and a levy introduced instead.
"Following a week of consultations within the industry and within the Government, KAM is requesting the minister of Finance to suspend the application of the 120 per cent excise duty imposed on polypropylene sacks and bags in order to assess the effects of the increase in thickness before introducing such a tax," says Ms Betty Maina, KAM chief executive officer.
"Industry is in agreement on the banning of the very thin plastic bags under 20 microns. We currently have an agreement with the Kenya Bureau of Standards to immediately phase out bags thinner than 20 microns, and a further agreement to move to 30 microns by January 1 next year."
The industry players feel that that the increase of bag thickness by 300 per cent will make plastic carrier bags more expensive, and as such create incentives for re-use. This will reduce the number of bags in circulation, and in effect cause a drop by at least 50 per cent as the case of South Africa.
Job loss
There are fears that the emerging differences between the minister and KAM might sour the relationship between the Government and the private sector during an election year.
Though the decision was meant to reduce the use of plastics and conserve the environment, manufacturers say the hefty tax was punitive and meant to cripple the plastics sub-sector. Over 9,000 people in 80 plastic bags manufacturing firms are likely to lose their jobs should the law be implemented.
The manufacturers are afraid that the duty would reduce their competitiveness in the fast developing sub-sector to an extent that they would be locked out of the market by imports mainly from China and India.
"We want the focus of the proposed measures on shoppers' bags as per the Budget speech and not packing materials for consumer items such as rice, sugar, milk and bread," says Maina.
Though the manufacturers share blame in environmental degradation by the plastics, they point a figure on the local authorities that have failed to contain not only the plastic waste but also other urban wastage including garbage.
"We have long recommended that local authorities and garbage collectors encourage separation of waste at source and domestic level," she adds. "This call has not been heeded, and consequently the industry has continued to struggle on its own devise methods of collection and recycling of carrier bags."
Though Kimunya has ruled out suspension of the tax, which was also imposed in Tanzania and Uganda, senior trade officials want them given period to adjust their operations.
In his Budget speech, Kimunya ignored the fact that the manufacturers were not registered with the Kenya Revenue Authority for the purpose of paying excise duty as required by law and so they could not sell their products.
"We must recognise that environment conservation is of great importance to us but the traders should be provided with a transition period because we do not want to send shock signals to the private sector," Trade and Industry PS Mr David Nalo told the FS.
KAM is adamant that sacks and bags for industrial and agricultural use should be exempt from excise duty. Tariffs lines, they say, should not be used to provide coverage of sacks and bags for the purpose of charging excise duty.
Protect local traders
The traders maintain that the minister should have banned importation of carrier bags with handles and flat bags without handles for purposes for resale and distribution.
"We believe that the objective of introducing these measures is good but we are concerned about the coverage of the proposed measures and the likelihood of the proposed measures achieving intended result," says Mr Bimal Kantaria, a KAM board member.
Kantaria, who also runs Prestige Packing Company, which manufactures and distributes plastic bags, says the minister ignored recommendations by the industry.
"While the minister's intention seemed to target shoppers' bags, this is not reflected in the coverage of the items in the Finance Bill 2007," he said.
According to the Finance Bill, presented together with the financial estimates over a week ago, all the three categories of plastics that attract no excise duty before were not spared the tax. These include sacks and bags of polymers of ethylene, sacks and bags of other plastics and sacks and bags of kind used for packaging of goods or polyethylene or polypropylene strip.
"KAM is concerned by this scope of products because the tariff lines indicated in the Bill cover many other products used by the sugar, tea and horticultural sectors which are already raising concerns over increased costs," said Kantaria.
"The packaging materials are weather proof and resistant to damage by tear, water, and acid and due to resistance to fungal attack, they are suitable for packaging various chemicals such as granules and powder as well as food products."
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