11 February 2014

Kenya: Olive Sample Laptop 'Came From Haier'

THE sample laptop provided by Indian company Olive to the Ministry of Education was manufactured by its Chinese rival, according to an informed source.

Last Friday Education secretary Jacob Kaimenyi awarded Olive a Sh24.6 billion tender to supply 1.2 million laptops to this year's P1 school entrants.

However the original tender documents specified that the successful supplier had to be an 'Original Equipment Manufacturer'. If Olive is not a manufacturer, it would not be eligible under the terms of the laptop tender.

In January, Olive emailed ECS, a Haier associate company, to see if they could manufacture the laptops for them.

Now it appears that the specimen laptop supplied last year by Olive to the Ministry of Education as part of the tender was in fact manufactured by Haier.

The laptop was branded Olive but came as a sample from the India office of chip manufacturer Intel.

Olive representatives in Nairobi yesterday said they were in meetings but would respond to the Star later.

The 'Classmate' type laptop is only manufactured at two places in China, either at Haier itself or at the Haier manufacturing line at ECS in Suzhou, a company that is 48 percent owned by Haier.

In an apparent confirmation that it does not manufacture laptops, the Olive website advertises various products that it distributes including the X107 laptop "made by Haier and for laptops launched under OLIVE brand".

Olive describes itself as a "service provider" selling customised products to telecom operators. It says it has presence in 23 countries, has sold 20 million devices worldwide since it was founded in 2006, and employs "11 to 25 people."

Haier is a far bigger company with 82,000 employees and had a turnover of over $25 billion last year. It has done e-education projects in 11 countries around the world including Argentina, Cuba, Guyana, Malaysia, Macedonia, Cote d'Ivoire and Mongolia.

In April 2013, Haier signed a Memorandum of Understanding with Centum, an investment company owned by Mt Kenya business and 28 percent by government, to build a computer assembly plant in Kenya. The investment, which would have generated 300 jobs, has now been put on hold.

Hewlett Packard is based in Palo Alto, California, and has been the world's leading PC manufacturer since 2007.

Several individuals, including a senior family member and a top TNA politician, have reportedly given President Uhuru Kenyatta copies of the January email from Olive requesting ECS to manufacture their laptops, according to unconfirmed reports. Uhuru is now apparently reviewing the tender award,

Olive reportedly also contacted China New Century Optronics in November 2013 to build the laptops. However China Optronics has not built laptops before, only low-end mobile phones and tablets, and has never bought Intel processors before. The Kenyan tender specifies Intel processors must be used in the laptops

After the 'best and final offer" in January, Olive had quoted US$217 per laptop and its two shortlisted rivals HP and Haier $219 and $220 respectively.

The informed source was sceptical that Olive could supply below $250 as HP and Haier both have volume discounts for purchasing Intel chips which Olive would not enjoy.

On Friday, Kaimenyi said the government expects the first batch of the 400,000 laptops in the first quarter of this year.

He said government cannot react to rumours that Olive does not manufacture laptops. He said that government dispatched officers to do due diligence on Olive and they came up "with good tidings."

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