Industry Ministry seeks development of manufacturing sector by retail actors


The Ministry of Industry (MoI) has turned its attention to local business communities engaged in retail in an effort to get them more involved in the manufacturing sector.
The Ministry was established three years ago [at the beginning of the five-year Growth and Transformation Plan (GTP)] to boost the manufacturing sector. It is now ready to lobby domestic market actors, limited by restrictions and costs associated with imports and distribution of goods, to invest in the manufacturing sector. Reliable sources said the Ministry will establish a new directorate called the Transformation Directorate to handle the new scheme of expanding the role of local business people in manufacturing.
Experts indicated that most business community members are engaged in wholesale and retail businesses rather than directly in the manufacturing sector. “They have huge capital reserves and turnover on a daily basis, but have no interest in becoming involved in a developmental business like manufacturing,” they said. According to them, many of these business people are already involved in capital intensive endeavours such as building and construction. It would benefit both them and the country if they become involved in the manufacturing sector, which is also capital intensive, because it can substitute the products that they import at much higher costs than if produced domestically.
Experts at the Ministry told Capital that the new directorate will be established in the current budget year and will have several provisions and provide more incentives for local business people to make the necessary investments. The involvement of such people, who control large capital, is crucial to expanding the industry.
The government’s plan with regards to the manufacturing sector is, not only expansion, but also to make it lead the economy by the end of the GTP. Even though it has previously made several infrastructure improvements and has offered incentives to the private sector, growth has not lived up to its projections. “Investments by foreign companies and local manufacturers is below expectations; therefore, the government has turned its attention to business people in retail and distribution who have huge capital,” experts said.
According to them, the directorate is expected to lobby the local business community to be part of the government’s strategy and invest in the sector.
To expand the sector, the Ministry has taken several measures and implemented various structural adjustments. The number of state ministers under the Ministry has increased from one to three in the past three years to give due attention to the Ministry’s affairs. This time around, it has come up with some new arrangements. 
The Transformation Directorate will be another new dimension for the Ministry.
In the current fiscal year, MoI has set a target to earn over USD 1.1 billion from the manufacturing sector exports. It earned only USD 282 million from the sector in the past fiscal year.