18 October 2007

Kenyan Plastic Makers Pull Out of German Fair

Hit by hefty taxes and stringent production standards, several Kenyan plastic makers have pulled out of the world's biggest plastics and rubber fair, which begins in Düsseldorf ,Germany, on Wednesday.

They say even if they learn new plastic manufacturing technologies in Germany they can not implement them in Kenya because the cost of producing plastics has gone up by 120 per cent following the passing of the Finance Bill on Tuesday.

More than 3,000 companies from the global plastics and rubber industries will show their latest developments at the K-Plastics Fair in Düsseldorf. The Conference is held after every three years.

The German conference will demonstrate that plastics are an integral part of consumers lives but solutions to environmental threats posed by plastics will also be sought.

"For as far as we know plastics cannot be eliminated" said Bimal Kantaria, a director of Prestige Packaging Limited, one of Kenya's oldest plastic manufacturers.

"What we need to do is to find an appropriate method of managing plastic waste. It's happening elsewhere in the world such as Britain and South Africa"

The one week fair comes against the backdrop of an onslaught against plastic usage in Kenya.

In an attempt to reduce the usage of plastics for packaging of consumer goods, the government imposed a 120 per cent tax on the plastic carrier bags.

In his budget speech in June, Finance minister, Amos Kimunya; had proposed a 120 per cent levy on plastics in a bid to protect the environment from degradation. The minister also proposed to impose a ban on very thin plastic bags.

The measures were expected to encourage industry players to devise environmentally friendlier bags for shoppers. The implementation of the 120 per cent tax started on August 1.

Parit Shah, the managing Director of Silpack Industries limited says he will attend the Germany fair not to learn new technology on plastic manufacturing but to engage fellow plastic industry players on the best way possible to reduce the threat of plastics to the environment.

Shah says, he also wants to know new developments from global players on alternative packaging and new machinery for manufacturing such packaging.

However, other plastic industry players say the alternative to plastics in the packaging of consumer goods would be expensive and more hazardous to the environment.

"Paper is the alternative to plastics in packaging. Producing paper is expensive and it will lead to the felling of more trees which will pose a serious environmental problem" says Mahesh Dodhia, the CEO of a plastic making outfit, Hi-Plast Limited.

Environmental protection and sustainability will share the spotlight with aesthetic and design concerns of plastics at the German Fair.

Local plastic industries and a Parliamentary Departmental committee on Trade and believe that the 120 per cent tax was punitive and ought to have been replaced by be replaced by Green Levy, payable on raw materials.

The funds realised from the Green Levy would then be channeled toward the plastic waste management.

The industry had protested against the hefty tax saying it would make the plastic bags, a favourite of shoppers and goods wrappers in Kenya, more expensive.

Manufacturers say they will have no choice but to pass the cost to consumers.

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