Kenya sets aside funds to develop domestic mobile phone industry

NAIROBI, Oct 23 (Reuters) - Kenya’s minister of information, communication and technology said on Tuesday that the government had set aside 1 billion shillings ($9.90 million) to help local start-ups in the mobile telephone software and hardware segments to grow.

Joe Mucheru, the ICT minister, told the annual meeting of the ICT industry in the capital Nairobi that he was concerned by the country’s imports of 50 million telephone handsets every two years, challenging local firms to start making them locally.

ICT is one of the fastest growing sectors in Kenya’s economy due to demand for services like high speed internet access and mobile financial services like M-Pesa, operated by Safaricom .

The country has 45.5 million mobile phone subscribers, data from the sector regulator showed, who use a range of imported mobile devices from companies like Apple and Huawei .

But African nations like Kenya, who do not have a solid industrial base, have been trying to replace imports with local products in order to save their hard currency and remove pressure on their foreign exchange rates.

The government would work with firms that seek to participate in the manufacturing and assembling of phones, in order to drive down their costs, Mucheru said.

“Why can’t we leverage on the skills available locally to manufacture these handsets that are suitable for our markets?” he asked. (Reporting by Duncan Miriri; Editing by Kirsten Donovan)