The Anti Counterfeit Authority undertook a National Baseline Survey on Counterfeit and other Forms of Illicit Trade in Kenya in partnership with TradeMark East Africa (TMEA) through funding from the Department for International Development (DFID). The study was achieved through collaborative efforts of several players in the public, private and development sectors, which are supportive of the fight against illicit trade in Kenya. The study highlights the extent (magnitude, level and prevalence) of counterfeiting and other forms of illicit trade in Kenya and proposes key recommendations for stakeholders’ consideration.
According to the study conducted between October 2019 and February 2020, the Government revenue lost in 2018 stood at Kes 153.1 billion up from Kes 129.72 billion in 2017. From the sixteen (16) sectors of the economy that the study concentrated on, building, mining and construction was heavily affected by counterfeiting with a share of 23.37% in value of total illicit trade, followed by energy, electrical and electronics with a share of 14.67% in 2018.
The sector with the most government revenue loss was food, beverage and non-alcoholic drinks with a share of 23.19%, followed by textile and apparel at 20.09%. Thirty (30) percent of the firms were aware that their products were being counterfeited and sold in the market, whereas 56.4% of the sampled firms were not aware that their products are being counterfeited and sold in the market.
The study also cites piracy as a critical form of illicit trade. According to the findings, the loss of sales as a result of pirated products stood at KES 17 billion in 2018. Although the trend depicts marginal decline between 2017 and 2018, the loss as a result of total sales is quite high ranging between 37.69% and 42.14%, which is a clear indication of how piracy is wiping profitability of the affected firms and individuals.
From the survey, the total volume of illicit trade in Kenya stood at KES 726 billion in 2017 and increased to KES 826 billion in 2018. The significance of this level of illicit trade is illustrated by its share in GDP, which in 2017 and 2018 was 8.9% and 9.3% respectively. It was also established that the Kenya lost KES 153.1 billion in government revenue to illicit trade in 2018 which was an increase from 129.72 billion in 2017. The number of jobs lost as a result of illicit trade stood at 44,198 in 2018 with counterfeiting accounting for 21% of the jobs lost. The total reported sales losses stood at KES 89 billion and the investment opportunity lost as a result of illicit trade was KES 123 billion in 2018. From the consumer survey, the level of public awareness on matters of illicit trade stood at 64.14% with that of counterfeiting at 66.42% as at 2019.
Click on the link to download the National Baseline Survey On The Extent Of Counterfeit And Other Forms Of Illicit Trade In Kenya report.
Click on the link to visit the National Observatory on Illicit Trade Dashboard.
