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Why Kenya is region’s top counterfeit goods market

Zachary Ochuodho @zachuodho

Hardly does a day pass without Kenya Revenue Authority (KRA) and other State agencies seizing substandard and counterfeit products which  enter the local market illegally.

The products estimated to cost Kenya about Sh200 billion annually in unpaid taxes, besides posing serious threat to health of millions of people and country’s security, are mainly driven by individuals who engage in narcotics trade, money laundering and terrorism.  

Business in counterfeits, experts say is also driven by advances in technology, globalisation of trade and the growing middle-class population keen on branded products.

Flora Mutahi, chairperson of Kenya Association Manufactures (KAM) admits that these products usually find their way to Kenya as a result of the weak enforcement mechanism.

She says economic cost of counterfeiting is vast as it involves job losses, missed sales opportunities and loss of tax revenue, besides denying consumers the right to access quality and genuine product.

“Counterfeits are today spread in every part of Kenya mainly due to widespread corruption, porous borders, advances in technology, cheap internet, e-commerce, international trade and consumers low purchasing power,” Mutahi explained.  

Samson Ombok, director of standards development and trade at Kenya Bureau of Standards (Kebs) concurs, saying whereas technology enables counterfeiters to produce fake products cheaply and easily, consumer awareness is on the rise.

“Increased awareness among enforcement agencies and the public about health and safety risks of the products and intellectual property protection has improved,” he says, adding that companies are using anti-counterfeit technologies to protect their products.

Duncan Kariuki, a trader of electronic products in Nairobi, says nearly every sector in the country has been infiltrated by fake products – some of which are now as good or better than the genuine products.

“Kenya has become the hotbed of counterfeit products. This is due to the rising population of middle class and the premium they attach to popular brands in the market,” he says.

Most counterfeit products today are of higher quality and compete directly with the genuine goods, adding that most consumers do not mind paying the premium for the products as long as they meet their needs, he adds.

Kariuki argues that because there are no specific laws that can get one arrested for purchasing fake premium products, Kenyan consumers are hardly bothered whenever they buy counterfeit products.

He explains that it is difficult for consumers to detect fake products because quite often, packaging materials, most of which are today recycled, get leaked out of the company’s own supply chain.

“Dubious manufacturers pick original packaging from the recycled market and refill them with substandard stuff well aware that others such as bottle caps can easily be imitated,” Kariuki says.

Some counterfeit exports contain fake local addresses on their packaging instead of “Made in China” which makes it difficult for the consumer to be suspicious given that the addresses provided are of popular manufacturing destinations.

Consumer Federation of Kenya Secretary General, Stephen Mutoro  attributed the problem of fake or substandard goods in the local market to high cost of production in the country – which has made everything made in Kenya too expensive for the average person.

According to investigators, most counterfeit goods that find their way to Kenya come from Asia, China in particular. China has become notorious for producing and exporting large quantities of fakes.

Lawrence Milewa, an officer from the Anti-Counterfeit Agency enforcement department, discloses that most fake products enter Kenya due to laxity at the entry points.

Available reports say the agency seized goods worth Sh1.7 billion last year and destroyed counterfeit products worth more than Sh700 million.

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