An Investigation Into The Factors Influencing Export Trade In Kenya: The Case Of Manufacturing Firms In The Pharmaceutical Industry

Abstract

The objective of this study was to identify the factors that influence trade in locally manufactured pharmaceutical products both from multinationals manufacturing locally and locally owned manufacturing companies. The population under study included all local pharmaceutical manufacturers. This included both the multinational and the locally owned firms. In total, at the time of the study there were twenty registered local manufactures. Two multi nationals and eighteen locally owned firms. The data collection method was through questionnaires which were administered to three people in each organization. The target respondents were the Managing directors, Production Managers (Quality control Managers), and the Finance managers in each company. The results of the study indicated that there were indeed various factors that influenced export trade in the industry. These factors were both internal and external to the firm. Most critical factors external to the firm that were significant included lack of support and guidance from the home country government, presence of uncertain and imperfect market and information situations and restrictive trade practices by host country governments. The study also revealed that there were capability gaps within the industry that hindered export trade advancement. This included lack of proprietary knowledge and lack of capital for research and development. The study also revealed that most local pharmaceutical produce was destined for the nearby markets of East Africa, West Africa and Sub-Saharan Africa. Developed market Economies e.g. Europe,America, Asia and the Middle East had not been exploited. The above results should be viewed and adopted in the light of the limitations of the study, which included time and resource constraints and non-participation of seven local manufacturers