Commonwealth News and Information Service (London)
16 May 2008
The Commonwealth Secretariat is assisting Kenya to boost its professional services sector as way of diversifying the country's economy and creating more employment opportunities.
As part of the efforts to assist the country, the Commonwealth Secretariat, has been working with Kenya Export Promotion Council and an inter-agency steering committee. A series of consultations have been held with industry players and policy makers aimed at formulating a national professional services export strategy.
Ms Estella Aryada, a trade adviser with the Commonwealth Secretariat who is managing the project said that like many developing Commonwealth Member States, Kenya is beginning to perceive professional services as an important contributor to sustainable economic growth.
Ms Aryada says that although goods still make up the bulk of total world trade, services are growing steadily. She added that as all production of goods includes a component of services, growth in goods trade would have a knock on positive impact on services. In 2006, worldwide exports pushed past US$2.8 trillion.
"Within the services sector, the traditional dominance of transportation and travel is being overturned by strong growth in other commercial services-or professional services- which have emerged as an important driver of growth in the global economy. Professional services accounted for close to US$1.4 trillion in 2006, or 50 per cent of global services exports," she said.
Ms Aryada said that the draft professional services strategy is to be presented to stakeholders in government and the private sector on Monday 19 May in Nairobi, the country's capital.
It is recognised that in addition to enhancing efficiency and adding value to the production of goods, services have the potential to generate employment, raise incomes and improve living standards in developing countries. In some sectors, the set up costs for services are low, and the requirements for export are less onerous than for goods. Kenya's services exports grew from $1.054m in 2000 to $1.974m in 2006. However, travel and tourism take up the lion's share of this sector which is why it is important to assess the prospects of other services sectors.
In drafting the strategy, several aspects of Kenya's economy were analysed, including supply capacity, the business climate, institutional and policy support as well as demand in regional and international markets. A number of sectors emerged as having greatest potential to increase Kenya's services exports. These are: Business Process Outsourcing, Accounting, Non-banking financial services and insurance. The scale of opportunity varies for the Eastern and Southern African region and international markets- Europe, India and US. The strategy foresees roles for different organizations in Government and the private sector, such as the Ministry of Information and Communication, ICT Board, Association of Professional Societies in East Africa (APSEA), among others.
The vision of the strategy is to achieve annual exports of $500m and create 50,000 jobs in Kenya in 5 years. The strategy recommends several actions aimed at putting Kenya on the services export map, including investment promotion, creation of a virtual EPZ and reducing the costs of IT connectivity.
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