CONSULTANCY SERVICES FOR STRATEGIC ENVIRONMENTAL ASSESSMENT (SEA) STUDY IN THE MASTERPLAN FOR THE LEATHER INDUSTRIAL PARK PROPSED AT KINANIE- , COUNTY

Draft SEA Report

November 2015

EPZA: SEA Process in the Masterplan for the Leather Industrial Park-1st Draft

DISCLOSURE PAGE

This Detailed SEA Report prepared under auspices of the Strategic Environmental Assessment Study in the Master Plan for Development of the Kinanie Leather Industrial Park is hereby disclosed as follows:-

Assignment: Strategic Environmental Assessment Study in the Master Plan for Development of the Kinanie Leather Industrial Park

Parties to the Contract for SEA Study: Proponent SEA Consultant

Administration Building, Repcon Associates Viwanda Road off - The Repcon Center Highway, Sigona 410 off KEFRI/KARI Rd-Muguga Athi River, P.O. Box 79605-00200, Nairobi P.O. Box 50563 00200 Telefax: 254-20-2248119; Nairobi- Kenya Mobile: +254 -721-274358; ISDN +254-45-6621000 +254 732-274358 VoIP Lines: 020-7606040/3 Email:[email protected] Mobile: +254 713-051172/3 +254 786-683222 +254 733-683222 Email: [email protected]

Fanuel Kidenda Date……………….. Michael Wairagu Date……………. Chief Executive Officer SEA Team Leader

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EPZA: SEA Process in the Masterplan for the Leather Industrial Park-1st Draft

Executive Summary

A. Background

The Government of Kenya (GOK) through its implementing agency, the Export Processing Zones Authority-EPZA is developing a Leather Industrial Park at Kinanie, . In line with requirements of the Environmental Management and Coordination Act (EMCA) of 1999, the proposed Master Plan was subjected to a Strategic Environmental Assessment (SEA) Study conducted as per Legal Notice 101 of June 2003 and the Guidelines for Strategic Environmental Assessment issued by NEMA. Conduct of the SEA has been managed by Repcon Associates (NEMA Firm of Experts No. 0002), a Nairobi based consultancy duly registered and licensed by NEMA.

The Detailed SEA Study stage which culminated in this report investigated likely economic, social and environmental impacts associated with the Masterplan proposals and identified mitigation measures that need to be put in place to ensure that the development and implementation of the Masterplan will be carried out in a sustainable manner. The SEA also identified options to enhance the technical sustainability, economic viability, and social acceptability in the implementation of the Masterplan.

B. The Master Plan for the Proposed Leather Industrial Park

The Masterplan for the Leather Industrial Park (LIP) has been conceived by the Ministry of Industrialization and Enterprise Development (MOIED) through the EPZA as a Kenya Vision 2030 flagship project targeting to enhance contribution of Manufacturing GDP growth to the national economy. The Masterplan proposes to create a Leather Industrial Park targeting Value additional and transformative research and innovation towards unlocking economic potential of the Leather sector in Kenya.

The Masterplan for LIP targets LR 23961-a 301ha property situated on the banks of the Mbagathi River in Kinanie Division about 16 kilometers along the (E434) road between Athi River and Rd. On the ground, the site is occupied by a Eucalyptus plantation located next to a sewerage treatment plant that handles sewerage delivered from the Athi River based EPZA complex through a 16km pipeline.

Proposals for development as per the Masterplan include establishment of Infrastructure in form of 5Kms each of paved road, street lighting and sewerline, a power substation, boreholes for water supply, storm water drainage, culverts and a Common Effluent Treatment Plant (CETP) in a site that is currently a forest plantation. The Masterplan proposes a phased development of 36 tanneries each to seat on a one ha plot complemented by an 18 leather value addition parks developed for purposes of transforming the leather produced into high value finished products for export. The VAPs will be complemented by SME parks and a Trade Center mainly for promoting and marketing high quality leather trade. Activities in Tanning and Value Addition will be underpinned by a Research and Development Centre charged with promoting development of leather industry mainly in quality control in processing and production of quality skins and hides together with leather industry information dissemination. Other support services in the LIP include an Administration Centre, Logistics and Customs area, and a housing estate comprised of 1,200 assorted units.

Development of the proposed leather industrial park is in line with the objectives of the national industrial policy framework of creating an enabling environment for industrial development, enhancing value addition, and promoting development of SMEs. The export oriented park is legally anchored under the EPZA Act Cap 517 and will adhere to all laws and policies relevant in Kenya.

C. Objectives and key milestones in the SEA Study

This SEA Process is aligned to the broad objectives for SEA Studies identified by NEMA in the recently issued National Guidelines for SEA where the overriding goal is to ensure that a proposed PPP is compatible with sustainable environmental planning and management. Conduct of the SEA process is iii

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guided by the Legal Framework for environmental management in Kenya as provided by the National Constitution and the Environmental Management and Coordination Act (EMCA) 1999 and its legal tools. In conformity with this, core milestones have been achieved as follows:Screening Study: Screening was undertaken to determine whether the proposed Master Plan required a SEA process. After consultations with NEMA, it was determined that a SEA would be required.

Scoping Study: Scoping of this SEA was carried out to define the scale of investigations to be undertaken during the detailed SEA stage. A SEA Scoping Report was prepared and submitted to NEMA.

Detailed SEA Study: Core highlights of Detailed SEA Stage activities include:

i) Situation analysis: Secondary data, especially on the pre-project baseline, was extracted from diverse reports, planning documents, etc obtained either from stakeholders or existing sources. Of critical importance were planning documents such as strategic plans from stakeholders which were analyzed towards collaborating and defining stakeholder interests and potential points of conflict with the proposed Master Plan. ii) Intensified Stakeholder analysis and consultation: Given the expectation for SEA studies to map potential areas of conflict between proposed Masterplan and existing stakeholder interests, considerable effort was invested in identifying, engaging and analyzing stakeholders. Such process proved quite useful in clarifying stakeholder interests, concerns and aspirations while providing useful linkage to other stakeholders and information. iii) Analysis of alternatives: The SEA study identified and analyzed alternative investment -use options against goals for meeting Vision 2030 objectives while sustaining environmental and social quality. iv) Identification of Impacts and their mitigation/enhancement: The SEA focused on significant impacts, both positive and negative, with a view of mitigating the adverse and enhancing the good. The efforts have been made to identify and highlight cumulative and induced impacts which may not be easily captured during the project specific IEE/IEA downstream. v) Formulation of an Environmental and Social Management Plan (ESMP): The SEA process culminated in formulation of a tool to guide resolution of anticipated impacts both at the current (planning) and downstream implementation stages.

D. Findings from the SEA Study:

This SEA made numerous findings which, if applied, can greatly shape focus of the Master Plan towards securing a socially acceptable, technically viable and environmentally sustainable development of DK area. Key salient findings are highlighted below.

The prevailing biophysical baseline: From the baseline characterization study, it emerged that the Mbagthi-Athi River basin in which the LIP will be situated is a water scarce area on account of aridity and overexploitation of available water as such, water to support operations of the LIP as currently conceived may not be available. It further emerged that, on account of draining Nairobi, , Machakos, Athi River and other towns, the Mbagathi-Athi system already suffers a huge pollution load which already comprises viability of this river as a source of water supply for downstream communities.

Stakeholders are supportive but also concerned: The SEA Team identified and consulted many stakeholders either through private interviews or public hearing meetings that culminated in a Disclosure workshop hosted by the EPZA at the Technology Development Center-TDC. The SEA Study encountered a charged ground comprised of residents who are aggrieved by the nuisances, disease and accidents hazards associated with operation of the EPZA owned iv

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sewer infrastructure. Indeed, failure by authorities to reign in operations of exhauster truck operators who often vandalize manhole covers and dump human waste in non-designated areas dominated any public forum arranged for the SEA. All stakeholders have however affirmed that they are not opposed to the proposed Leather Industrial Park.

Investor interest at Kinanie:

Investor interest in Kinanie is mixed. While some tannery operators are ready to transfer Beam House operations to Kinanie to take advantage of subsidized effluent treatment facilities, majority are in favour of remaining in their current operating bases in which they have invested immensely, preferring instead to process wet blue grade leather for sale at Kinanie. Others still are concerned that local demand for wet blue grade leather is not adequate to absorb all production.

Capacity of the leather sector to support additional tanneries: The Leather Sector in Kenya is supported by some modest off-take (12% cattle, 36% sheep, 33% goats) from the national herd of 17.5 million Cattle, 27.7 million Goats, 17.1 million Sheep and 3.0 Dromedaries with an annual yield of 3.5 Million cattle hides, and 8.9 skins (Shoats) which support activities of 14 active tanneries with an combined established capacity of 2.28million hides and 18.6million skins pieces and who mainly process Wet Blue Grade Leather for export and to feed activities of locally based footwear and leather product manufacturers. Local demand for hides and skins largely outstrips domestic supply which is regularly supplemented from the region, mainly Somalia, Tanzania and Uganda. From supply projections made in this study, a surplus of 0.24million pieces of hides is anticipated in 2018 and this an grow to 0.62 million pieces 2020 which can support one tannery of a 800MT/year capacity (520,000 pieces/yr) or alternatively, 5-6 small tanneries at 80,000 hides per year while a surplus of 300,000 pieces/day can support two tanneries. This is possibly the potential targeted by the GOK in the ongoing move to establish 6 additional tanneries at , , Makueni, Isinya, Mogotio and Kanduyi. As it were now, the national hides and skins resource base can only support 3 additional tanneries starting in year 2018.

Analysis of alternatives in delivering aspiration of the Masterplan Alternative approaches in packaging the LIP towards delivering on the national aspiration of attracting FDI, job creation and manufacturing for export, different investment models were analyzed based on observed trends and stakeholder suggestions. Seven alternatives were analyzed, scored and ranked on their potential to deliver on ten criteria namely;- job creation, creation of new trade opportunities, foreign direct investment, foreign exchange earnings, multiplier effect, budgetary pressure, environmental costs, pressure on water, carbon foot print and pressure on energy resources with results as follows:- Option Intervention Score Rank 1 Status quo: Current tanneries processing Wet Blue for -11 7 Export 2 LIP Model: Attract tanneries to Kinanie with full value 13 2 addition 3 Improved LIP Model: Locally import Wet Blue, Crust and 31 1 Finished grade leather to Kinanie for full value addition

Options 2 and 3 which include the LIP model and a modification have potential to deliver on expectations albeit with varying degrees of success.

The Kinanie Model: Of the three models, option No 2 entailing importing locally processed wet blue grade leather to Kinanie for value addition to full products was found to hold the best promise for economic transformation. This v

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option, now branded the Kinanie Model is based on a scenario of utilizing existing tannery capacity to process wet blue grade for onward processing and value addition at Kinanie thus blending well with observed limited capacity of the local hides and skins production in supporting additional tanneries. The Kinanie Model has further merit in that, it combines best economic impact with least environmental costs while assuring equitable distribution of benefit streams to Kinanie, County and National Government thus resonating well with the Social Pillar of the Vision 2030 and is thus the preferred option in this SEA Study.

Kinanie holds the promise: Full taping of the potential borne in the Kinanie Model will require resolution of diverse constraints core of which is the poor market penetration by locally manufactured shoes, whereby, only 7.9% of the 42 million pair national shoe trade is supplied from local leather while close to 27 million pairs are sourced from imported mitumba shoes. The challenge here is for the research complement of the LIP to develop a strategy for unlocking and penetrating the local market to at least 60%. With proper focusing of research towards improving design and quality, it is possible to loop in the entire market share of Mitubma shoes currently accounting for 63.4% of the shoe trade.

Table ES 001: Dynamics of the Kenyan shoe industry Type of Footwear Total Pairs Sold Non- Leather Imported leather Kenyan leather (106 pairs) (106 pairs) (106 pairs) (106 pairs) Second hand shoes 26.5 18 8.5 0 (mitumba) New – low price 12.9 8.1 2.2 2.6 New – mid price 2.2 0.6 0.9 0.7 New – high price 0 0 0.2 0 Totals 41.8 26.7 11.8 3.3 Percentages 100 63.9 28.2 7.9

E. Findings from the SEA Study:

The potential economic impact: By 2013, the gross earnings from export of processed and non processed leather was US $ 146, 731 equivalent to Ksh 15.11 billion. Assuming that by 2017, all hides and skins are processed to wet blue grade leather and channeled to Kinanie to produce an estimated for 38.4 million pairs, each with a net value of Ksh 1,000, this adds a net Ksh 38.4 billion to the economy, equivalent to 9.21% of manufacturing GDP, a significant jump from the current 1.8%, all other factors constant. In the process, a whopping Ksh 3.8billion will accrue directly to the labor engaged in shoe manufacturing process. This is the potential awaiting unlocking at Kinanie.

Two adverse impacts are anticipated from development of the Leather Industrial park at Kinanie:  Pressure on water quality and quantity: The entire Athi River basin is a water stress zone where local supply is supplemented by imports from far removed places such as Kilimanjaro, Sasumua dam, Ndaka-ini and now the proposed Northern collector targeting to tap further afield. Imposition of additional non-planned for demand for water as anticipated from 36 new tanneries would pose huge challenges while the resultant effluent load will cumulatively affect the Athi-river whose quality is currently greatly stressed by pollution from Nairobi, Thika, Athi-river Machakos and other towns.  Potential to induce non planned development: Implementation of the LIP is likely to trigger influx of population seeking employment and accommodation, rapidly increasing demand for services such as water and sanitation, schools, healthcare and transport. All of this has potential to attract non planned development including mushrooming of shanties to the detriment of the local real estate market.

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F. Recommendations of the SEA

This SEA observes that the proposed Master Plan for Leather Industrial Park offers significant opportunity for growth. It attracts Foreign Direct Investment, manufacture exports and create employment, which are the recipe for new and accelerated economic growth. Having said that, the SEA has identified several areas where measures need to be put in place to improve the sustainability and social acceptability of the Master Plan. Key recommendations include:

i) Resizing of the Leather Industrial Park: So far, the most drastic action in mitigation is to downsize the scope of the LIP to peg it to available raw material supply, meaning adoption of the Kinanie Model. As such, within the MTP period, no new tanneries are anticipated at Kinanie. ii) Resolution of pre-existing concerns: The EPZA is already engaged with residents of Kinanie and other stakeholders in resolving concerns associated with current operations of the sewerage infrastructure at Kinanie. The same should be sustained. iii) A Baseline Survey to determine availability of Hides and Skins: Towards fine tuning of investment options at Kinanie, there is need to conduct a comprehensive Baseline Survey to document the demand/supply scenario for Hides and skins. iv) Development Control for Kinanie Division: Towards stemming non planned development, at Kinanie, the Machakos County Government should move in an establish development control based on zoning in the area. v) Formulation of a Masterplan for Water Demand Management: The EPZA should team up with sectoral oversight bodies to identify and develop new water sources to supply the proposed Leather City at Kinanie. vi) Role of Mandatory EIA and Environmental audit: All new investments targeting Kinanie will require to meet statutory requirements for environmental management as stipulated in EMCA 1999 and its regulations. Additionally, each investor will require to seek Eco-labelling for all operations. vii) Creation of an all inclusive management framework for Kinanie: Cap 517 confers the EPZA with an exclusive mandate to manage Export Processing Zones. However, towards ensuring mutually beneficial co-existence at Kinanie, there will be need to put in place a participatory framework for vetting and monitoring activities of all investor in Kinanie particular on the question of environmental management and job allocation. viii) Management of the proposed CETP and sanitary land fill: Both facilities will require to in-build components on waste recovery as a way of creating jobs.

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ACRONYMS ACC - Assistant County Commissioner AIDS - Acquired Immuno-Deficiency Syndrome AWSB - Athi Water Service Board Asl - above sea level BOQs - Bill of Quantities CIDP - County Integrated Development Plan CITES - The Convention on Trade in Endangered Species DCC - Deputy County Commissioner EA - Environmental Assessment EIA - Environmental Impacts Assessment EMCA - Environmental Management & Coordination Act, 1999 EPZs - Export Processing Zones EPZA - Export Processing Zones Authority EU - European Union FDI - Foreign Direct Investment GoK - Government of Kenya HIV - Human Immuno-deficiency Virus IMP - Impact mitigation plan KeNHA - Kenya National Highways Authority KCAA - Kenya Civil Aviation Authority KCCP - Kenya Center for Cleaner Production KFS - Kenya Forest Service KIRDI - Kenya Industrial Research Development Institute KWS - Kenya Wildlife Service LDCK - Leather Development Council of Kenya LIP - Leather Industrial Park LN - Legal Notice MCG - Machakos County Government MP - Member of Parliament MTP - Medium Term Plan NEMA - National Environment Management Authority OHS - Occupational Health and Safety OSHA Occupational Safety and Health Act PET - Potential Evapo-transpiration TOR - Terms of Reference SEA - Strategic Environmental Assessment WRMA - Water Resources Management Authority

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Table of Contents

1: INTRODUCTION ...... 1

1.1: About this report ...... 1

1.2: Objectives and scope of the SEA ...... 1

1.3: Focus and Scale of SEA Study ...... 2

1.3.1: Definition and rationale ...... 2

1.3.2: Scale and Focus ...... 3

1.4: Approach to the SEA Study ...... 3

1.4.1: Systematic Approach to the SEA process ...... 3

1.4.2: The SEA Screening ...... 4

1.4.3: SEA Scoping Stage...... 4

1.4.4: Detailed SEA Stage ...... 5

2: Disclosure of the Master Plan for the Leather Industrial Park ...... 8

2.1: The Vision and Mission ...... 8

2.2 Objectives of the Kinanie Leather Industrial Park ...... 8

2.2.1: The nature of Export Processing Zones ...... 8

2.2.2: Objectives of the Kinanie Leather Industrial Park ...... 9

2.3: Scope and Scale of the proposed Kinanie Leather Industrial Park ...... 9

2.3.1: Geographic Scope ...... 9

2.3.2: Current land-use on LR 23961 ...... 10

2.3.3: Components of the proposed Masterplan ...... 11

2.4: Justification of the Master Plan ...... 14

2.5: Institutional Context ...... 14

3: POLICY, LEGAL AND INSTITUTIONAL FRAMEWORK ...... 16

3.1: The Policy Framework ...... 16

3.3: The Institutional Framework for SEA ...... 31 ix

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3.4: Outcome from analysis of Policy Legal and Institutional framework ...... 32

Chapter 4. Baseline Characterization ...... 33

4.1: Scoping of the potentially receiving area ...... 33

4.2: The Biophysical Baseline ...... 34

4.2.1: Administrative jurisdiction for the Masterplan ...... 34

4.2.2: Physiography, geologic and site soil conditions ...... 34

4.3: Socio-Economic Baseline ...... 39

4.3.2: Physical Infrastructure ...... 41

4.3.3: Status of Socio-welfare ...... 42

4.4: Analysis of local and national economic trends ...... 42

5. LEATHER, HIDES AND SKINS SECTOR IN KENYA ...... 52

5.1: Sector performance ...... 52

5.1.1: Introduction ...... 52

5.1.2: Production trends in the Kenyan Leather Sector ...... 53

5.1.3: Trends in Exports from the Leather sub-sector ...... 55

5.2 Leather Exports ...... 56

5.3: Analysis of potential for growth in the Leather Sector ...... 56

5.3.1: Livestock Resources base ...... 56

5.3.2: Supply of Hides and Skins ...... 59

5.3.3: The Tanning Sub-Sector ...... 62

5.3.4: Capacity of the Leather sector to support additional tanneries ...... 66

6. STAKEHOLDER ANALYSIS AND CONSULTATIONS ...... 68

6.1 Legal Foundation for Stakeholder Consultation in Kenya ...... 68

6.1.1 Provisions of the National Constitution ...... 68

6.1.2 Requirements of EMCA 1999 ...... 68

6.2 Approach to Stakeholder Analysis ...... 68

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6.2.1 Criteria for Stakeholder Identification/Stratification ...... 68

6.2.2 Levels in Stakeholder Consultations ...... 71

6.3 Outcome of the Stakeholder Analysis ...... 72

6.3.1 Scoping Stage Consultations ...... 72

6.3.2 Progress in Stakeholder Consultations ...... 73

6.3.3 Stakeholder Concerns from the Scoping Stage Consultations ...... 74

6.4 Consultations at Detailed SEA Stage ...... 74

6.4.1 Scope and Focus of Detailed SEA Stage Consultations ...... 74

6.4.2 Summary of Consultations during the Detailed SEA Stage ...... 75

6.5 Key Issues Emerging from Detailed SEA Stage Consultations ...... 83

7: ANALYSIS OF ALTERNATIVES ...... 85

7.1: Approach to Analysis of Alternatives ...... 85

7.2.2: Analysis and ranking of the Alternatives ...... 86

8: ANALYSIS OF POTENTIAL CONFLICTS WITH PRE-EXISTING INTERESTS ...... 93

8.1: Collation of Potential Impacts ...... 93

8.2: Analysis for conflict/harmony with other pre-Master Plan interests ...... 93

8.2.1: Harmony with national-scale plans ...... 94

8.2.3: Harmony with Regional Planning Objectives ...... 97

8.3: Screening of Master Plan for potential Impact on Strategic Resources ...... 99

8.4: Overall Picture of the Strategic Impact of the Master Plan ...... 99

9: IMPACT PREDICTION ...... 101

9.1: Approach to Impact Prediction ...... 101

9.1.1: Background to Impact Prediction ...... 101

9.1.2: Tools in Impact Prediction and Analysis ...... 101

9.1.3: Analysis of Impact Severity ...... 102

9.2: Description of Potential Impacts: Design Stage ...... 102

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9.2.1: Positive Impacts at Design Stage ...... 103

9.2.2: Adverse Impacts at Design Stage ...... 103

9.3: Description of Potential Impacts: Construction Stage ...... 104

9.3.1: Positive Impacts at Construction Stage ...... 106

9.3.2: Negative Impacts at Construction Stage ...... 106

9.4: Description of Potential Impacts: Operation Stage ...... 110

9.4.1: Positive impacts at Operation Stage ...... 110

9.4.2: General adverse impacts at Operation Stage ...... 112

10 Framework for Environmental and Social Management ...... 120

10.1: Overview ...... 120

10.2: Principles in Environmental and Social Management ...... 120

10.5: Mitigation Measures at Construction Stage ...... 123

10.5.1: Mitigation of Landscape destabilization ...... 123

10.5.2: Pollution control from Construction Activity ...... 124

10.5.3: Occupational Health and Safety...... 126

10.5.4: Summary of Mitigation Measures at Construction Stage ...... 127

10.6: Mitigation Measures at Operation Stage ...... 131

10.7: Summary of Mitigation Measures at Operation Stage ...... 132

10.8: Environmental and Social Management Plan...... 135

10.8.1: Institutional Arrangement ...... 135

10.8.2: Management and Monitoring Framework ...... 135

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1: INTRODUCTION

1.1: About this report The Government of Kenya (GOK), through its implementing agency, the Export Processing Zones Authority-EPZA is developing a Masterplan for a Leather Industrial Park to be established in for the Kinanie area of Athi River in Machakos County as a Kenya Vision 2030 Flagship Project. As part of the Master Plan Study and in line with requirements of the Environmental Management and Coordination Act (EMCA) of 1999, the proposed development will be subjected to a Strategic Environmental Assessment (SEA) Study conducted as per Legal Notice 101 of June 2003 and the Guidelines for Strategic Environmental Assessment issued by NEMA in 2014.

As part of the Master Plan Study and in line with requirements of the Environmental Management and Coordination Act (EMCA) of 1999, the proposed development will be subjected to a Strategic Environmental Assessment (SEA) Study conducted as per Legal Notice 101 of June 2003 and the guidelines for Strategic Environmental Assessment recently launched by NEMA. The SEA Study is being undertaken by Repcon Associates a Nairobi based consultancy duly registered and licensed by NEMA (NEMA Firm of Experts No. 0002). Appendix 1.1 provides NEMA registration documentation in respect of Repcon Associates and SEA Team Leader.

This document outlines the Draft SEA Report.

1.2: Objectives and scope of the SEA Design of this SEA Study has been informed by two sets of objectives. First, the National Guidelines issued by NEMA have identified a raft of objectives to which any SEA study should be focussed and which have been adopted for this study namely:

i) Better ensure that a proposed PPP is compatible with sustainable environmental planning and management; ii) Ensure the consideration of alternative policy options, including the do-nothing option, at an early time when an agency has greater flexibility; iii) Enhance the consistency of a PPP across different policy sectors, and when relevant, make explicit the trade-offs to be made between different sectoral policy objectives; iv) Evaluate the regional environmental impacts of multi-sectoral developments over a specified time; v) Support decision-making and incorporate emerging environmental issues into sustainable development vi) Guide investment programs that involve multiple sectoral policies or sub- projects; vii) Assess the environmental impacts of policies that do not have an explicit environmental dimension;

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viii) Identify environmental impacts and integrate mitigation measures during program formulation, and in the process, enhance Environmental Management Plans; ix) Ensure the consideration of cumulative, indirect, or secondary impacts and other unintended consequences when planning multiple, diverse activities; x) Support time-efficient and cost-effective development planning by avoiding the need to reassess some issues and impacts at project level (e.g., when an issue or impact was effectively dealt with at a strategic level); xi) Inform decision makers by evaluating alternative options that meet the PPP xii) objective(s), while also being the best-practicable-environmental-option(s); xiii) Integrate environmental principles into the development, appraisal, and selection of policy options; xiv) Give adequate attention to environmental considerations in decision making, on par with economic and social concerns, and with a view that trade-offs may be necessary in some situations; xv) Provide an early opportunity to check whether a proposal complies with national and international environmental policy and consequent legislative obligations; xvi) Establish a context that is more appropriate for subsequent development proposals; xvii) Provide a transparent and accountable decision-making framework.

Building on these general objectives, the proponent of this Master Plan study has prescribed specific objectives for this SEA, which are: to identify key environmental and social issues associated with the LIP development, review of alternatives including the zero-option, and propose a set of measures aimed at ensuring environmental sustainability of trade and economic growth. Specifically, this SEA will:

 identify environmental and social priorities and key linkages between environmental protection and trade growth in areas to be influenced by LIP;  assess likely significant effects of LIP development on these environmental and social priorities and key linkages;  formulate a set of measures to address these priority concerns and to take advantage of opportunities that will emerge from LIP development, considering institutional and financial conditions needed for implementing such proposal; and,  recommend mechanisms that will enable future adjustments to maintain and promote sustainable and equitable economic / trade growth in response to phased, gradual development of LIP, taking into account the different speed of developing LIP

1.3: Focus and Scale of SEA Study

1.3.1: Definition and rationale The National Guidelines for Strategic Environmental Assessment in Kenya define SEA as a range of analytical and participatory approaches to integrate environmental 2

EPZA: SEA Process in the Masterplan for the Leather Industrial Park-1st Draft

consideration into policies, plans, or programs (PPP) and evaluate the interlink ages with economic and social considerations. SEA is seen as a family of approaches that uses diverse tools as opposed to a single, fixed, prescriptive approach to upscale the aims and principles of Environmental Impact Assessment (EIA) upstream in the decision-making process, beyond the project level, when major alternatives are still possible (UNEP, 2002). Consistent with Agenda 21 principles, SEA is a proactive approach to integrating environmental considerations into the higher levels of decision-making wherefrom likely significant effects of a Policy, Plan, or Program (PPP) on the environment are identified, described, evaluated and dimensioned in terms of secondary, cumulative, synergistic, short-, medium- and long-term, permanent, and/or temporary tendencies followed by documentation along local standards and procedures.

1.3.2: Scale and Focus Consistent with the definition above, the SEA Study under reference targets to analyse, document and integrate environmental considerations into the planning process for the proposed Leather Industrial Park to ensure that environmental and social considerations will be mainstreamed into an investment decisions and implementation downstream. The other focus of this plan–level SEA is to identify and propose an institutional framework which will ensure that implementation of the Master Plan will remain aligned to local, national and international aspirations for a clean and healthy environment for all as enshrined in the National Constitution.

1.4: Approach to the SEA Study

1.4.1: Systematic Approach to the SEA process Conduct of the SEA followed the Activity Schedule prescribed in the National Guidelines for SEA (Box 1.1 below). Comments on activities at each stage of study are provided in sections below.

Table 1.1: Systematic procedure for SEA Studies up to Draft Report Stage Stage Activity Status Screening Stage Brief on PPP submitted to NEMA Done Screening of PPP to decide need or Done otherwise for SEA within 7 working days Scoping Understanding the PPP Done Other preparatory tasks Done Selection of SEA Experts Done Scoping Study Done Preparation of SEA Scoping Report Done Submission of SEA Scoping Report to Done NEMA NEMA reviews the Scoping Report for Done adequacy NEMA decision on the Scoping Report Done within 21 days.

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Detailed SEA Study Conduct of SEA culminating in Draft Done Report Quality control of draft report Done Submission of Draft Report to NEMA Underway Public Review and Pending Validation Stage Source: SEA Study Team

1.4.2: The SEA Screening

The National Guidelines for SEA require all SEA process be preceded by a Screening Stage in which the Proponent submits a Briefing Note to NEMA for review and direction. A Briefing Note in respect of the Masterplan for the Kinanie Leather Industrial Park was submitted by the EPZA and reviewed by NEMA who granted an approval vide letter Ref NEMA/SEA/5/2/038 (Appendix 1.1) based on which the SEA process proceeded to the Scoping Stage.

1.4.3: SEA Scoping Stage

(i) Context of Scoping within the SEA Process Scoping provides an opportunity for the proposed PPP to be reviewed and internalised in terms of Proponent, target goals, outputs, effects and impacts, proposed implementation framework and timeline, the policy/legal environment, thematic and geographic coverage, stakeholders in the implementation chain, potential investments, target resources among others whose screening against the potential receiving environment facilitates early identification of potential impacts. Thus, in the case of the SEA under reference, considerable time has gone into discussion and review of available documents towards understanding the context and scope of the proposed Master Plan for the Leather Industrial Park.

(ii) Activities in the Scoping Study Scoping is the phase that determines the content (range), spread and depth and intensity of investigations at the detailed SEA Stage. To facilitate this, a study schedule was conceived with tasks as follows:-

 Familiarization and documentation of the proposed Masterplan for Kinanie Leather Industrial Park,  Review of the Policy/Legal framework,  Preliminary mapping of the receiving environment,  Stakeholder analysis,  Scope and Scale of Potential Impacts,  Scope and Scale of investigations at the SEA Stage,  Conclusion and recommendations.

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(iii) Tools in the Scoping Stage:- Scoping employed a diversity of tools namely:-  Review of secondary reports  Analysis of the Policy, legal and planning environment  Stakeholder engagement  Screening for harmony with other sectoral goals  Field investigations  Screening for harmony with sectoral, regional and national planning goals  Analysis of alternatives

(iv) Outcome of the Scoping Phase

From Scoping Phase activity, it emerges that implementation of the masterplan has potential to occasion an array of impacts as follows:-

Conflict with pre-existing legal mandates: The master plan has potential to conflict with one national and one regional planning mandate both of which are in the area of water resource management. Impact on locally strategic resources: The master plan has potential to adversely affect 2 strategically critical areas namely;- water resources and pre-existing investments which already play crucial economic roles.

Tendency to occasion cumulative and irreversible impacts: The master plan has potential to occasion at least 7 cumulative and six irreversible impacts associated with the magnetic effect in urbanization in an ASL area leading to escalating pressure on land, water and climatic resources.

1.4.4: Detailed SEA Stage Activities at the detailed SEA stage were largely informed by outcome of the Scoping Phase which identified two broad categories of impacts namely:-

(i) Pre-masterplan concerns: Concerns already existing at Kinanie and occasioned by current activities of the EPZA on site. Specifically, the EPZA operates a sewerage treatment plant at Kinanie which is connected to the EPZA complex at by a 16Km pipeline. Residents are aggrieved by nuisances;- foul smell, contaminated dust, water pollution, mosquito menace and other hazards associated with the sewer plant. Further, failure to control activities of exhauster service providers who illegally dump human waste outside designated areas and even vandalize manhole covers along the sewer-line thus exposing local residents to hazards of communicable diseases and accidents are of grave concern to the residents who see no benefit of hosting a sewer plant that treats sewage brought in from another county.

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Though such concerns were raised during stakeholder consultation for, they were considered to be outside the scope of the SEA Study and could therefore only be shared with the Proponent.

(ii) Emergent concerns:- Concerns potentially emergent from implementation of the Masterplan are highlighted in 1.4.3(iv) above based on which, a study schedule was designed with focus as follows:-

a) Comprehensive documentation of the receiving environment to better define;  ecological potential and carrying capacity.  livelihood systems and economically strategic resources,  local production systems including value addition,  ecologically sensitive resources,  socio-economic profiles,  issues pertaining to land availability for the Masterplan, b) Comprehensive documentation of the Master Plan including interaction with prevailing baseline, current and planned infrastructure, c) Comprehensive investigation of current status of soil, water and air pollution d) Comprehensive analysis of water resource base in the area followed by modelling of future demand supply scenarios e) Inventory of all stakeholders by legal mandate, capacity and interests, f) Participatory assessment of alternative models to the Masterplan, g) Identification of measures to further in-build sustainability and flexibility into the selected model of Masterplan, h) Consensus building on the selected model i) Modalities for environmental and social management within the Masterplan j) Other considerations

(iii) Activities at the Detailed SEA Phase:- Activities in the SEA stage are outlined in the detailed Workplan elaborated in Appendix 1.2 but largely focussed on:-  Refine documentation of the Masterplan  Refine documentation of the receiving environment  Review of the policy/ legal and regulatory framework for the SEA  Detailed stakeholder analysis and engagement  Screening the Masterplan for harmony/ conflict with pre-existing mandates  Investigation and analysis of environmental and social concerns  Analysis of alternatives in implementation  Identification of requisite mitigation measures  Formulate an Environmental and Social Management Plan (ESMP)  Prepare Draft SEA Report for NEMA review

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(iv) Approach to tasks at detailed SEA Study Diverse methods were applied in approaching tasks at the detailed SEA Phase as summarised in table 2.2 below.

Table 1.2: Study methodology at detailed SEA Stage Core issue to be investigated Study Methodology Comprehensive documentation of the receiving environment to better define:- i) ecological potential and carrying Review of secondary data capacity. supplemented by field ii) ecologically sensitive resources, investigations iii) livelihood systems and economically Review of secondary data strategic resources, supplemented by livelihood iv) local production systems including value mapping through interviews addition, v) socio-economic profiles, vi) issues pertaining to impacts on Property Analysed case studies based on Prices by the Masterplan, similar trends Comprehensive documentation of the Master Review of project design and Plan including interaction with prevailing documentation baseline, current and planned infrastructure, Comprehensive investigation of current status Analytical studies based on of soil, water and air pollution laboratory analysis of samples Comprehensive analysis of water resource base Hydrological modelling based on in the area followed by modelling of future the water balance approach demand supply scenarios Inventory of all stakeholders by legal mandate, Stakeholder analysis and interviews capacity and interests, Participatory assessment of alternative models Comparative studies based on to the Masterplan, selected ranking criteria Identification of measures to further in-build Sensitivity analysis sustainability and flexibility into the selected model of Masterplan, Consensus building on the selected model Plenary meetings with stakeholders, One to one meetings Modalities for environmental and social Preparation of a rationalised ESMP management within the Masterplan Other considerations Based in a case by case basis

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2: Disclosure of the Master Plan for the Leather Industrial Park

In this section, the Masterplan for the Leather Industrial Park proposed for Kinanie as currently conceived and designed is disclosed. The basis of disclosure is the Land-use allocation plan document prepared for the Kinanie Site.

2.1: The Vision and Mission The purpose of the Masterplan is to create a State of the Art Leather City to be a center of excellence in tanning, manufacture of finished leather goods, and leather related services.

2.2 Objectives of the Kinanie Leather Industrial Park

2.2.1: The nature of Export Processing Zones

An Export Processing Zone (EPZ) is a specific type of FTZ, set up generally in developing countries by the governments to promote industrial and commercial exports. Most EPZ located in developing countries: Brazil, Colombia, India, Indonesia, El Salvador, China, the Philippines, Malaysia, Bangladesh, Pakistan, Mexico, Costa Rica, Honduras, Guatemala, Kenya, Sri Lanka, Mauritius and Madagascar have EPZ programs. In 1997, 93 countries had set up export processing zones employing 22.5 million people, and five years later, in 2003, EPZs in 116 countries employed 43 million people. The Export Processing Zone (EPZ) program was established in 1990 to provide an attractive investment opportunity for export oriented business ventures within designated areas or zones. The objective was to help the economy through increased productive capital investment, jobs creation, technology transfer, backward linkages development and export diversification. Kenya is a fiscally sensible destination for assured returns on investments while engaging in planned and sustainable development of the national economy and providing employment to the country‘s workforce. The EPZ is managed by the Export Processing Zones Authority (EPZA). EPZA is a state corporation established by the Government of Kenya through an Act of Parliament - the Export Processing Zones Act (Cap 517 of the Laws of Kenya) for the promotion and facilitation of export-oriented investment and the development of an enabling environment for such investments. EPZ offers a range of attractive incentives to ensure low cost operations, fast set up, smooth operations and high productivity of the businesses. There is an effective one-stop-shop service at the EPZA which facilitates the investment process. Over the years, the Export Processing Zones Program has registered impressive growth. This growth has enabled the program to achieve its objectives of employment creation, expansion and diversification of exports; increase in productive investment, generation of foreign exchange earnings, technological transfer and creation of linkages with the customs territory. This has been achieved through initiating, promoting and providing attractive investment opportunities for the export –oriented business ventures in the country. To attract foreign investors, the EPZA continues to implement a range of appealing fiscal, logistical and administrative incentives to ensure lower cost operations, rapid set-up and smooth and hassle-free functioning of businesses operating within the EPZs. The EPZA has conceived programmes and policies that are intended to foster a bright investment for investors and further encourage them to take advantage of the numerous opportunities the 8

EPZA: SEA Process in the Masterplan for the Leather Industrial Park-1st Draft

country offers which include, extensive business regulatory reforms, the investor friendly fiscal and monetary policies, supportive political frame work, well established private sector and the entrepreneurial facilities and social amenities and the quality of life in the country. The EPZA welcomes all export-oriented investments but is particularly keen to develop projects and attract companies in the areas of food processing, fresh produce, packaging for shelf ready product, wooden products, leather and animal based products, jewellery and gemstones, pharmaceutical products and herbal medicines, medicinal supplies, cosmetic and personal care products, packaging products, textiles, commercial handicrafts, transport equipment, electronic and electrical goods, building materials & furnishings, data processing & audio-visual services and consultancy and professional services. There are seven EPZs strategically located across the country, all managed and promoted by EPZA. The individual EPZs are located in the Nairobi, Athi River, , , , and Kimarer in Rift valley. Tax benefits under EPZA The following are tax benefits for investors:-

 10 year corporation tax holiday and 25% tax thereafter  10 year withholding tax holiday  Stamp duty exemption  100 % investment deduction on initial investment applied over 20 years  Perpetual duty and VAT exemption on company input including machinery, spare parts, construction materials, office equipment, packaging, heavy diesel and fuel oil excluding other petroleum based fuel, motor vehicles that are from outside the zone and motor vehicle spare parts

2.2.2: Objectives of the Kinanie Leather Industrial Park The overall objective of the Masterplan is to facilitate the development of an economically, socially and environmentally sustainable leather industrial park, an objective to be served through pursuit of goals as follows (Appendix 2.2):-

 Increase productive capital investment  Generate jobs  Transfer of Technology and skills  Development of backward and forward linkages  Diversification of Export products

2.3: Scope and Scale of the proposed Kinanie Leather Industrial Park A full profile of the Masterplan for Proposed Leather Industrial Park is disclosed as Appendix 2.2 to this Scoping Report. Brief highlights are provided in sections below.

2.3.1: Geographic Scope

Table 2.1 below provides administrative jurisdiction of the Kinaie site for proposed Leather Industrial Park. Target site is LR No. 23961, a 301.1ha property franking the Mbagathi River 9

EPZA: SEA Process in the Masterplan for the Leather Industrial Park-1st Draft

along the within the Kinanie Location of Kinanie Division under Athi River Sub County within Machakos County. In terms of elective jurisdiction, LR 23961 which is wholly owned by the EPZA falls within Kinanie Ward and Mavoko Constituency and can be accessed through the Mutonguni (C434) Rd about 16 kilometres east of Athi River Town (Fig 2.1). Appendix 2.1 provides a copy of the Title Deed to LR 2396.

Table 2.1: Administrative jurisdiction of the Leather Industrial Park Administrative/Political Name Jurisdiction County Machakos Sub-county Athi River/ Division/Ward Kinanie Constituency Mavoko Location Kinanie Sub-location Kinanie

Kangundo Rd

Site for proposed Leather Industrial Park

Kinanie Division

Daystar University Athi River Town

Fig 2.1: Location and access Map for LR 2961 Source: National Physical Planning Department, 2015

2.3.2: Current land-use on LR 23961 Two land uses predominate on LR 23961 namely:-

The EPZA Sewage Treatment Ponds: Sewage from the EPZA complex at Athi River is conducted through a 16km long pipeline to oxidation ponds located just past Kinanie Market where it is treatment before discharge into Mbagathi River. Most of the water however is

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utilised for horticultural farming within vicinity. Associated with the sewage works is a housing estate and a small office for site staff.

Eucalyptus Plantations: An estimated 500acres on LR 23961 is occupied by a semi- mature plantation of Eucalyptus camaldurensis currently being salvaged for fuelwood.

Plate 2.1: Blue gum Plantations on LR 23961

2.3.3: Components of the proposed Masterplan EPZA intends to establish a Leather Industrial Park (City) in Kinanie to process leather and leather based products. It is expected to provide demand-driven services and facilities to the same. It will be established as an eco-friendly, world-class production facility, incorporating best practice in economic and social facility design, cluster formation, export promotion, effluent treatment and pollution control.

From the proposal, it is evident that the LIP is designed to address constraints facing Kenya‘s leather sector with particular emphasis on increasing the economic contribution of the sector and enhancing the long-term sustainable growth of the value chain. The LIP is intended to accelerate the attainment of the sector‘s potential for contributing to Kenya‘s industrial sector. The EPZ proposes to develop the LIP as follows:-

i) Infrastructure This includes: Paved roads covering an entire length of about 5Kms; 5Km Sewer line; 5Kms Street Lighting with 35M spacing between poles; a proposed power substation; Water boreholes in different areas within the zone; Storm Water drains, culverts; and Common Effluent Treatment Plant (CETP).

ii) Tanneries(200,000 m2)

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Establishment of tanneries will be done in 2 phases: 20 Tanneries in Phase 1 and 16 Tanneries in phase 2. Each tannery will be on 1 ha plot.

Fig 2.2: Proposed land use plan in the Leather Industrial Park

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Fig 2.3: Artistic impression of the Leather City Industrial Park

iii) Value Addition Parks (60,000 m2)The development of Value addition Park proposes 8 leather value addition centers each sitting on 1ha plot in Phase 1 and ten (10) leather value addition centers in Phase 2. The value addition park is aimed at using the finished leather to add value to finished products.

iv) SME Park (15,000m2) The park will house value addition activities and will target the small micro enterprises dealing with Leather products. Most of the products here will be targeting the domestic market. Sheds within this development will range from 350M squared to a maximum of 750M squared

v) Trade Centre – (8500 m2) This will house activities that promote trade and development of the leather industry business. It will consist of: Conference facilities (1000 Pax Capacity); Exhibition Floors for the (space of approximately 1500m2); Shopping complex for leather products- shoes, belts, bags (1500 m2); Offices for institutions; Common facilities- toilets, restaurants, etc. vi) Research and Development Centre ( 5,000 m2) The center will have several departments promoting development of leather industry mainly in quality control in processing and production of quality skins and hides together with leather industry information dissemination.

vii) Administration Centre (2500m2)

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This will house the regional management offices for Regional Manager for the zone Managers for Support services Manager for Utilities

viii) Logistics and Customs Offices (3000 m2) This will house government regulatory authorities and other organizations facilitating the free outward of movement of goods and raw materials: KRA Offices, Clearing and forwarding Agencies, KEBS Offices and Weights and Measures Department.

ix) Housing estate: (20,000 m2) The park will partly cater for the accommodations needs for all level workers in Phase 1 and Phase 2. The proposed housing typologies include: 4 Bedroom executive Apartments- 10 No. of Blocks each with 8 Units 3 bedroom Apartments – 10 No. of Blocks each with 8 Units 2 Bedroom Apartments – 10 No. of Blocks each with 16 no. of Units 1 Bedroom Apartments - 10 no. of Blocks each with 32 No. of Units Bedsitters Apartments – 10 No. of Blocks each with 64 No. of Units Green open spaces for children‘s play areas, a kindergarten school, and 3000 M 2 shopping and commercial Centre to cater for the residents. x) Utilities and Services ( 600 m2)

This will house the power plant, the workshops, the water offices, Power offices, estates department among others.

xi) Common Effluent Treatment Plant (CETP) and Landfill

Effluent treatment from the tanneries as well as recycling of such waste will take place in the CETP while the landfill will handle solid waste from both the tanneries and the rest of the land uses. 2.4: Justification of the Master Plan The Kenyan leather industry is a prime agro-based sector with a high potential for economic development and promotion for employment opportunities. The industry will have strong backward and forward linkages that will provide opportunities for value addition using locally sourced raw materials.

The proposed leather industrial park is in line with the objectives of the national industrial policy framework of creating an enabling environment for industrial development, enhancing value addition, and promoting development of SMEs. It will also be an attempt at addressing the current challenges faced by the sector.

2.5: Institutional Context

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Ministry of Industrialization and Enterprise Development: The Leather Industrial Park as conceived for implementation at Kinanie is an undertaking of the GOK through the EPZA, a State Corporation operating under auspices of the Ministry of Industrialization and Enterprise Development-MOIED.

The Export Processing Zones Authority-EPZA: Development of the leather Industrial Park at Kinanie is an undertaking by the EPZA, a Body Corporate established under te Export Processing Zones Act (Cap 517) of the Laws of Kenya. In its Strategic Plan, the EPZA seeks to make a significant contribution to national economic and social objectives through industrial growth and job creation as proposed in the Leather Industrial Park.

Other stakeholders include the Leather Development Council of Kenya-LDCK, Kenya Industrial Research Development Council-KIRDI, among others.

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3: POLICY, LEGAL AND INSTITUTIONAL FRAMEWORK This chapter defines the policy, legislative and institutional frameworks which will govern development, implementation and operationalization of the Master plan for the proposed Leather Industrial Park at Kinanie which, by design cuts across many sectors of the economy, some of which enjoy protection under diverse local, national, regional and global policy/ legal tools. An analysis of requirements of such tools has been undertaken as part of the SEA process to ensure that the Master Plan output attains the goals of social acceptability, economic viability and technical sustainability in line with internationally accepted standards for good practice. A detailed analysis of potential inter-phasing of the Master plan with diverse legal instruments is briefly highlighted in sections below.

3.1: The Policy Framework

Two policy frameworks are considered relevant to development planning as envisaged in the Master Plan for the proposed Leather Industrial Park :-  National Policy Framework for development planning  National Policy Framework for environmental management

3.1.1: Policy Framework for Development Planning in Kenya National Constitution 2010: See under 3.2.1 below.

Sessional Paper Number 10 of 2012 on Kenya Vision 2030 Sessional Paper Number 10 of 2012 on Kenya Vision 2030 is the National Policy Economic Blueprint that entrenches Kenya Vision 2030 as the long term development strategy for Kenya.

The proposed Leather Industrial Park is a Flagship Project under the Economic Pillar of Kenya Vision 2030 -the country‘s development blueprint which aims to transform Kenya into a newly industrializing, ―middle-income country providing a high quality life to all its citizens by the year 2030‖. The Vision is anchored on three key pillars: Economic; Social and Political; and had as one of its goals the realization of the Millennium Development Goals (MDGs) by the year 2015.1 Strategies of the Economic Pillar are aimed at generating sufficient resources to attain the Vision and MDGs which required, among others, a 25- year GDP Growth averaging 10% per annum. Towards this, the Economic Pillar has identified six key sectors to spearhead the drive to attain high and sustainable economic growth namely tourism, agriculture,

1 MDGs have since lapsed and have been replaced by the Sustainable Development Goals (SDGs) 16

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wholesale and retail trade, manufacturing, business process outsourcing and financial services and finally, Oil, Gas and Mineral Resources.

Manufacturing which is identified as one of the key drivers and aims at achieving a ―Robust, Diversified and Competitive Manufacturing Sector.‖

With regard to environmental quality, Vision 2030 anticipates a Kenyan nation characterised by a clean, secure and sustainable environment by 2030 and sets the goals for 2012 as; (i) to increase forest cover from less than 3% at present to 4%; and (ii) to lessen by half all environment-related diseases. Specific strategies will involve promoting environmental conservation in order to provide better support to the economic pillar flagship projects and for the purposes of achieving the Millennium Development Goals (MDGs); improving pollution and waste management through the design and application of economic incentives; and the commissioning of public- private partnerships (PPPs) for improved efficiency in water and sanitation delivery. Kenya will also enhance disaster preparedness in all disaster-prone areas and improve the capacity for adaptation to global climatic change. In addition, the country will harmonise environment-related laws for better environmental planning and governance.

The Second Medium Term Plan (MTP) 2013-2017

The Kenya Vision 2030 is being implemented in five year successive Medium Term Plans. The first plan covered the period 2008-2012. The 2013- 17 MTP is the second in a series of successive 5-year plans and draws on lessons learnt in implementing the first MTP. It seeks to implement the flagship projects identified under Vision 2030 over the five year period together with incomplete flagship and other projects and programmes in the previous Medium Term plan. It will also take due cognisance of the devolved structure of government following promulgation of the Constitution of Kenya 2010 and recent discovery of oil and mineral resources.

For the manufacturing sector, the Vision and MTPII focus on the establishment of special economic zones in , Mombasa and ; the development of SME parks and industrial parks in each of the 47 counties in order to attract foreign direct investment (FDI), to promote value addition, and to develop technical skills. All this is necessary in order to address the acute challenges of poverty, joblessness, and inequality and to facilitate faster realization of Kenya Vision 2030.

The Second Medium term Plan (MTPII) of the Vision focuses on the establishment of Industrial parks in various places to act as magnets for The MTPII advocates for the 17

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development of SMEs and Industrial Parks in each of the 47 counties to attract new companies expand employment opportunities to citizens and attract FDI. The parks will offer infrastructure and shared resources such as power supply, telecommunication hubs, management offices, and internal transportation.

The MTPII supports adoption of industrial Clusters approach as a development strategy to focus on market-oriented research, value addition, and marketing of region specific products through the support of academia, the private sector, and related actors. The Sector will pursue the development of three clusters, which include:

• Meat and leather cluster through establishment of meat processing plants; • Tanneries and other related industries in , Garissa and ; and • Promotion of dairy products processing in Kiganjo ()

The establishment of the leather industrial Park is therefore consistent with the requirements of the second Medium Term Plan that is under implementation.

Kenya National Industrialization Policy Framework 2010

The National Industrialization Policy aims to spur economic growth in Kenya through industrialization in order to create employment and contribute to the growth of GDP. Under the policy, the industrial sector is projected to grow by at least 15% per annum by 2017, by creating an enabling environment for a robust, diversified, competitive, and innovative industrial sector.

The National Industrialization Strategy: Development of the Leather Industrial Park is seen as major milestone in the operationalization of the National Industrialisation Strategy recently issued by the MOIED under the banner ―An aspiration to attain Vision 2030‖. The strategy recognises that the country must grow its GDP by between US$ 4 and 6 billion per year for 17 years to 2030, increase the manufacturing base to deliver 20% of GDP, increase FDI 5 times over the current level, create an additional 5 million jobs, and attain global top 20 ranking in ease of doing business rankings by 2020. The Ministry‘s strategy is one of job creation and industrialisation built on foundations of improving the ease of doing business; supporting enablers of growth such as skills development, infrastructure provision, and access to finance; unlocking the potential of small and medium enterprises (SMEs); developing a compelling FDI attraction plan

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and building strong government delivery capability. The key components of the Ministry‘s strategy are sector-specific and include:-

 Growing critical (agro-processing) sectors where Kenya has scale – tea, coffee, flowers, horticulture  Leveraging natural advantages to create competitive sectors -textiles and cotton, leather, agro-processing, beef and fishing  Building local industries to support resource and infrastructure investments in oil, gas, mineral, infrastructure (e.g. steel) and geothermal  Transforming government industry (public sector enterprises including Pan Paper Mills, sugar factories, coffee millers, coconut and cashew nut processors, livestock processors and Pyrethrum Board of Kenya).

Sessional Paper No. 3 of 2009 on National Land Policy The National Land Policy was formulated with the aim of securing rights over land and provide for sustainable growth, investment and reduction of poverty in line with Government overall development objectives. The policy will offer a framework of policies and laws designed to ensure the maintenance of a system of land administration and management that will provide:  All citizens with opportunity to access and beneficially occupy and use land;  Economically viable, socially equitable and environmentally sustainable allocation and use of land;  Efficient, effective and economical operation of land markets;  Efficient and effective utilization of land and land-based resources; and  Efficient and transparent land dispute resolution mechanisms. Within such a policy framework, the master Plan will identify practical options in securing a frce occupancy of the Dongo Kundu land targeted for development of the Leather Industrial Park .

Sessional Paper No 1 of 1996 on Environment and Development: Sessional Paper No 1 of 1996 is the official statement on national policy on environment and was released in 1996 following on recommendations of the National Environment Action Plan (NEAP) of 1994. The NEAP Process had been launched earlier on in 1992 following the Country‘s participation in the United Nations Conference on Environment and Development (UNCED) in Rio de Janeiro during which Kenya alongside other nations became signatory to Agenda 21 which called on all nations to pay closer attention to environmental management at national level. Through Sessional Paper No 1 of 1996, the Kenya Government guarantees every citizen the inalienable right to a clean and healthy environment and commits to pursue a policy strategy of integrating environmental sensitivity into national development planning process and sets broad policy objectives as follows:-  Optimal use of natural land and water resources in improving the quality of human environment; 19

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 Sustainable use of natural resources to meet the needs of the present generations while preserving their ability to meet the needs of future generations;  Integration of environmental conservation and economic activities into the process of sustainable development;  Meeting of national goals and international obligations by conserving bio- diversity, arresting desertification, mitigating effects of disasters, protecting the ozone layer and maintaining an ecological balance on earth.

Among other provisions, Sessional Paper No. 1 of 1996 also sets out sectoral priorities for environmental sustainability which in most cases have been operationalized through formulation of guidelines for quality and environmental management in respective sectors. A National Environmental Law (EMCA, 1999) has since also been enacted to secure implementation of the national policy on environment.

The Millennium Development Goals for 2015: The Millennium Development Goals (MDGs) are eight goals to be achieved by 2015 that respond to the world's main development challenges. The MDGs are drawn from the actions and targets contained in the Millennium Declaration that was adopted by 189 nations-and signed by 147 heads of state and governments during the UN Millennium Summit in September 2000. They include:- i) Halving extreme poverty and hunger (1990-2015); ii) Achieving universal primary education (by 2015); iii) Promoting gender equality (by 2015); iv) Reducing under-five mortality by two-thirds (1990-2015); v) Reducing maternal mortality by three quarters (1990·2015); vi) Reversing the trend of HIV/AIDS, malaria and TB (by 2015); vii) Ensuring environmental sustainability (by 2015); viii) Developing global partnership for development with clear targets for aid, trade and debt relief (by 2015).

Nationally, the GOK has taken bold steps to domesticate the MDGs as exemplified by investment in the PRSP process through which participatory mapping of poverty incidence at both District and National Level was undertaken, implementation of the Economic Recovery Strategy for Wealth and Employment Creation and implementing projects that directly confront specific aspects of the MDGs. By anchoring the Economic Pillar of Vision 2030 which seeks to generate resources needed to address MDGs, implementation of the Master Plan for the Leather Industrial Park remains attuned to the national and indeed global agenda for social development.

3.2: The Legal Framework Legal analysis in this SEA is meant to achieve three objectives namely;-

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 To define the legal context providing for development planning as envisaged in the Master Plan for the proposed Leather Industrial Park  To define and in-build legal safeguards for environmental and social management in the Master Plan.

3.2.1: Legal foundation to development planning in Kenya The Constitution of Kenya (2010) The Constitution of Kenya (2010) identifies the State and County as the two tiers of governance in terms public administration. According to Article 66 of the Constitution, the State may regulate the use of any land, or any interest in or right over any land, in the interest of defence, public safety, public order, public morality, public health, or land use planning. This allows the State to go into planning of national land. Also, under Article 185 of the Constitution, County Assembly may receive and approve plans and policies for the management and exploitation of the county‘s resources, its infrastructure and institutions. Also the Fourth Schedule stipulates the roles of the State and County Governments as to planning issues, which includes the State‘s role for coordination of land use planning; and the County Government role in making the plan and its implementation. Thus the constitution stipulate the main point and disciplines in regard to State and County planning, and leaves the details to be dealt with in other related acts. Since the promulgation of the Constitution in 2010, several laws on devolution and touching on planning have been enacted including: The Urban Areas and Cities Act, 2011; The County Governments Act, 2012; The Transition to Devolved Government Act, 2012; The Intergovernmental Relations Act, 2012 and The Public Finance Management Act, 2012. Other relevant laws that have been enacted in the different sectors to support implementation and operationalization of devolution include: the National Government Coordinating Act, 2012, and the County Governments Public Finance Management Transition Act, 2013. Relevance of such statutes to the Master Plan Process for the Leather Industrial Park is briefly highlighted below.

The EPZA Act Cap 517: In terms of Institutional jurisdiction for the proposed Leather Industrial Park, Cap 517 has an overriding mandate as it provides legal foundation for the establishment of export processing zones under the Export Processing Zones Authority. Under Section 3(1), the Act establishes the Export Processing Zones Authority (2) as a body corporate with perpetual succession and a common seal For purposes of (9-1) :- (a) the development of all aspects of the export processing zones with particular emphasis on provision of advice on the removal of impediments to, and creation of incentives for, export-oriented production in areas designated as export processing zones; and 21

EPZA: SEA Process in the Masterplan for the Leather Industrial Park-1st Draft

(b) the regulation and administration of approved activities within the export processing zones, through implementation system in which the export processing zone enterprises are self regulatory to the maximum extent; and (c) the protection of Government revenues and foreign currency earnings. Under Cap 517, EPZA enjoys a wide mandate necessary for the development of exports towards generating foreign exchange for the county. It is this mandate that will be brought to bear in operationalizing the Masterplan for the Leather Industrial park at Kinanie. Physical Planning Act Cap 268 The word physical planning denotes in general all sorts of urban and infrastructure planning, and the Physical Planning Act (2009) thus relates to various aspects of planning. The importance of the Act resides on the provision of the authority to control development activities to the local government (namely the County). Article 29 states that the County has the following authorities;  to prohibit or control the use and development of land and buildings in the interests of proper and orderly development of its area  to consider and approve all development applications and grant all development permissions Also, Article 30 states that no person can carry out development within the area of a local authority without a development permission granted by the local authority. Essentially, Article 29 of Cap 286 confers on County Governments power to control development planning and essentially put the Master Plan process for the proposed Leather Industrial Park under the planning jurisdiction of Machakos a County. The County Government Act 2012 The County Government Act of 2012, which has adapted to the Constitution‘s State and County structure in relation to devolution, stipulates on the County planning issues in Part IX. The County Government Act declares the County integrated plan to be central to the County‘s administration and prohibits any public spending outside of the plan. The Act clarifies that the County Integrated Plan to be broken down into the economic plan, physical plan, social environmental plan and spatial plan. Also, the Act states that the County Plan commands,  County integrated development plan  County Sectoral plans  County spatial plan  Cities and urban areas plans as stipulated by Urban Areas and Cities Act

The Urban Areas and Cities Act 2011 This law passed in 2011 provides legal basis for classification of urban areas (City when the population exceeds 500,000; a municipality when it exceeds 250,000; and a town when it exceeds 10,000) and requires the city and municipality to

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formulate an integrated development plan (Article 36 of the Act). The integrated development plan as stipulated in the Act has to reflect;- 1) vision for the long term development of the city or urban area; 2) an assessment of the existing level of development; 3) any affirmative action measures to be applied; 4) development priorities and objectives; 5) development strategies which shall be aligned with any national or county sectoral plans and planning requirements; 6) a spatial development framework; 7) operational strategies; and 8) applicable disaster management plans; 9) a regulated city and municipal agricultural plan; 10) a financial plan; and 11) the key performance indicators and performance targets (Article 40). The integrated development plan thus formulated has to be submitted to the county executive committee, and the committee has to submit the plan to the county assembly with an opinion within 30days (Article 41).

Under Article 36, the integrated development plan so developed is required to be the central pillar in public administration of the city or municipality this forming the basis for;- i) the preparation of environmental management; ii) preparation of valuation rolls for property taxation plans; iii) provision of physical and social infrastructure and transportation; iv) preparation of annual strategic plans for a city or municipality; v) disaster preparedness and response; vi) overall delivery of service including provision of water, electricity, health, telecommunications and solid waste management; and vii) the preparation of a geographic information system for a city or municipality.

The strategy plan as stated in 4) above denotes an annual plan to be adopted in the county assembly following the integrated development plan, and the Act requires the board or town committee to formulate the strategy plan soon after the adoption of the integrated development plan (Article 39). The Urban Areas and Cities Act is thus a powerful strategic tool designed to inject order into the planning and management of urban areas. A CIDP for Machakos as anticipated in the Urban Areas and Cities Act 2011was developed in 2013. 3.2.2: Legal framework for Environmental Management in Kenya

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Development and implementation of the Master Plan for the proposed Leather Industrial Park s will comply with all laws and regulations adopted in Kenya, more so, to ensure harmony with other sectors of the National Economy. Towards documenting the full legal operating framework for development and implementation of the Master Plan, a comprehensive review of all relevant statutes has been undertaken as part of the SEA as highlighted in sections below.

(i) The National Constitution 2010 The eminent domain for environmental management in Kenya is the National Constitution which sets national obligations towards securing a safe environment for all. Essentially, the National Constitution 2010 gave effect to the legal framework previously created by adoption of the Environmental Management and Coordination Act (EMCA) 1999. Section 42 of the Constitution guarantees the right to a clean and healthy environment for all citizens while through a raft of measures while Section 69 (1)-f requires the State to Establish systems of environmental impact assessment, environmental audit and monitoring of the environment. In Section 72 however, the new constitution allows for enactment of laws towards enforcement of any new provisions of the Supreme Law.

(ii) The Environmental Management and Coordination Act (EMCA) 1999 Strategic Environmental assessment is part of the regime of Environmental assessments which are mandatory in Kenya under section 58 of EMCA 1999. More specifically, Regulations 42 and 43 of Environmental Management and Coordination (Regulations for EIA and Audit-Legal Notice 101 of EMCA) provide for conduct of Strategic Environmental Assessment in Kenya. Regulation 42(1) requires Lead Agencies in consultation with the Authority to subject all proposals for public policy, plans and programmes for implementation to a strategic environmental assessment to determine which ones are the most environmentally friendly and cost effective when implemented individually or in combination with others. Further, Regulation 42 (2) requires that, the assessment carried out under this regulation shall consider the effect of implementation of alternative policy actions taking into consideration:—

(a) the use of natural resources; (b) the protection and conservation of biodiversity; (c) human settlement and cultural issues; (d) socio- economic factors; and (e) the protection, conservation of natural physical surroundings of scenic beauty as well as protection and conservation of built environment of historic or cultural significance.

(iii) Other Environmental Regulations under EMCA: Towards enhancing good environmental practices in Kenya, NEMA has gazetted environmental regulations (tabulated below) to which all activities should harmonize. At the detailed SEA stage, modalities of in building these regulations and other standards either gazetted or recommended by NEMA will be investigated.

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Table 3.1: Environmental regulations relevant to the proposed LIP Regulation Focus Legal Notice 101 of June 2003 - This is the tool that gives legal foundation to Environmental (Impact conduct of SEA Studies in Kenya. Assessment and Audit) Regulations, 2003 Legal Notice 160 of 1st Dec This regulation requires full measures be taken to 2006- Environmental prevent introduction of alien/ invasive species of Management and Co-ordination flora and fauna and is important because of the Act (Conservation of Biological Prosopis menace currently wreaking havoc in Diversity) Regulations 2006: Kenyan ASALs. Legal Notice 19 (Wetlands, Important towards conservation of the Mbagathi River Banks, Lake Shores and River Bank. Sea Shore Management) Regulations, 2009 Legal Notice 61 of 22nd May Sets maximum allowable noise levels 2009 Legal Notice 120 of 29th Sept Regulation 24 prohibits any kind of pollution of 2006- Environmental water meant for fisheries, recreation or any other Management and Co-ordination use and is thus critical in controlling water Act (Water Quality Standards) pollution from the LIP. Regulations 2006 Legal Notice 121 of 29th Sept Sets standards for waste management 2006- Environmental Management and Co-ordination Act (Waste Management) Regulations 2006 Legal Notice 131 of 13th October Sets emission standards for internal combustion 2006 Environmental engines Management and Co-ordination Act (Fossil Fuel) Regulations 2006 National Sand Harvesting Sets guidelines for sustainable sand harvesting in Guidelines, 2007 Kenya Legal Notice 73 of 31st May Sets guidelines on handling and use of controlled 2007 substances. There will be need to screen investments under the Master Plan for controlled substances Draft Air Quality Regulations, Objective is to provide for 2008 prevention, control and abatement of air pollution to ensure clean and healthy ambient 25

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air. It provides for the establishment of emission standards for various sources such as mobile sources (e.g. motor vehicles) and stationary sources (e.g. industries) as outlined in EMCA 1999. Source: JICA Study Team

(iv) Inter-sectoral coordination in Environmental Management in Kenya In recognition that EMCA is framework legislation, Legal Notice 101 of EMCA identifies and designates all GOK Agencies with legal mandates over specific sectors to be Environmental Lead Agencies for purposes of Environmental Assessment. LN 101 of EMCA further requires that the respective sectors be consulted as Lead Agencies in making decisions pertaining to environmental assessment for projects in respective sectors as a safeguard to ensure that NEMA does not approve PPPs that contradict sector policies and legislation. As such, this SEA study will identify and engage all stakeholders with legal planning mandates for specific sectors as an entry point of the detailed study of their sectoral master plans. The idea is to ensure that SEA for proposed Leather Industrial Park does not conflict with planning strategies and objectives for respective sectors.

In that capacity, the legal mandates will also serve the vital role of determining the critical relevance of diverse stakeholders to the development and implementation of the master plan. Legal analysis therefore, is a vital tool for stakeholder analysis as unveiled in Chapter Four below.

From preliminary analysis undertaken for this scoping study, diverse statutes have been deemed to have over-bearing influence on the Masterplan for the proposed Leather Industrial Park at Kinanie. The same are briefly highlighted in Table 3.2 below. Table 3.2: Analysis of legal planning mandates covering the Master Plan area SN Legal Tool Custodian Legal mandate Relevance to Masterplan for Leather Industrial Park 1 The Physical State Coordinate all spatial Legal requirement for Planning Act Department of planning in the country each County to Cap 286 Physical develop a CIDP Planning 2 Schedule 4 of County Confers legal planning MCG has prioritised National Governments mandate to the County development targets Constitution, of Machakos Government of Machakos Public Finance Management Act 2012 26

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SN Legal Tool Custodian Legal mandate Relevance to Masterplan for Leather Industrial Park 3 Water Act WRMA Has prepared a National Need to harmonize 2002 Water Masterplan (NWMP) the Masterplan for 2030 to link water the LIP with the management to national National water aspirations for sustainable Masterplan economic development Has developed a sub- Need for the catchment management plan proposed LIP to be in for the Athi Basin harmony with management targets set in the Plan. Athi Water AWSB was established under The current supply to Service Board through the Gazette Notice the EPZA is tapped (AWSB) No.1775 of 21st March 2003 from the NAWSSCO, with a mandate for a WSP under the planning, developing, AWSB Jurisdiction. rehabilitating and expanding water and sanitation services AWSB prepared a infrastructure Water Master Plan 2012-2035 The TANATHI The is parastatal created Has Strategic Plan for Water Services through Gazette Notice water supply within Board No.69 of 4th June 2008 has jurisdiction a core mandate to coordinate water supply in 4 counties namely: Kajiado, Makueni, and Machakos. 4 TARDA Act TARDA Coordinate all development Has undertaken Cap 443 Planning in the Tana and spatial planning for Athi River basins the area under jurisdiction 5 State Leather Established through a Legal Has strategic plan for Corporations Development Notice No. 114 of 9th the Leather Sector Act Cap 446 Council of September 2011with Kenya-LDCK mandate to develop the Leather Sector in Kenya 6 State Export Gazette Notice 4342 of 19th Has Strategic Plan Corporations Promotion August 1992 established the targeting export Act Cap 446 Council Export Promotion Council promotion

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SN Legal Tool Custodian Legal mandate Relevance to Masterplan for Leather Industrial Park for purposes of promoting export oriented production. 7 Technology Kenya Was established in 1979 to Has a major research Act Cap.250 Industrial spearhead Industrial focus on Lather Research and Research in Kenya Technology Development Institute (KIRDI) 8 Roads Act KeRRA Planning for development of Rural 2007 rural roads in Kenya KeNHA Planning for development of Planning for National Highways development of Greater Eastern Bypass 9 EMCA 1999 NEMA Has national mandate for Need for proposed environmental regulation. Leather City to conform with environmental regulatory standards set by NEMA. 13 Companies All licensed Have made huge Need for such Act, Cap 486 players in the investments targeting leather investors to be Kenyan Leather produced in Kenya, the protected and value Chain same source being targeted accommodated in the by the LIP. proposed LIP. Mavoko Water A Water Service Provider Has developed & Sewerage authorised under the water Strategic Plan 2008 – Company Act 2002 2013 to guide water Limited supply in area of (MAVWASCO) jurisdiction 14 The Civil KCAA Under Section 56, the KCAA Under Detailed SEA, Aviation Act executes development the sensitivity of No. 21 of 2013 Control on areas considered Kinanie which is in a sensitive for aviation flight path will be purpose clarified with the KCAA Source: SEA Study Team

(v): Reference to International Agreements

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According to the Registrar of International Treaties and other Agreements in Environment, there are about 232 treaties which are legally binding to Kenya. While this SEA Study is obliged to pay close focussed attention to implications of treaties with an environmental and social mandate, the stated strategy of the Masterplan for LIP in targeting foreign and local investors to produce for both the domestic and export markets, there is likelihood of may treaties especially on trade, culture, labour, working conditions, Basic Rights, smuggling, trafficking etc could be triggered in course of operating the facility. Treaties that potentially can be triggered at Kinaie are tabulated below: No Convention Status Reason 1 Convention on International Trade in Not There are no IUCN RED List Endangered Species of Wild Fauna triggered Species in the Masterplan area and Flora 2 Convention on the Elimination of all Triggered Machakos County has formed forms of Discrimination against a Secretariat to tackle GBV Women, 1979. 3 Convention on the Conservation of Not There are no AEWA species in Migratory Species of Wild Animals, triggered the masterplan area 1979. 4 The 1985 Vienna Convention on Triggered Likelihood of use on Ozone Protection of the Ozone Layer depleting substances at Kinanie 5 The 1987 United Nations Montreal Triggered As above Protocol on substances that deplete the ozone layer 6 The 1992 United Nations Framework Triggered Implementation of Masterplan Convention on Climate Change will escalate the carbon (UNFCCC) which led to the Kyoto footprint in manufacturing, Protocol of 1997 transportation and domestic sectors. 7 Convention on Biological Diversity Not Kinanie area is neither a triggered migratory corridor, nor habitat for endangered and locally import species 8 Cartagena Protocol on Biosafety to Triggered Potential impact of research in the Convention on Biological application of Biotechnology in Diversity, 2000 the Leather Value addition requires close monitoring 9 International Plant Protection Not The masterplan will not Convention (Revised), 1997 triggered involve introduction of Pest Spp 10 Rotterdam Convention on the Prior Triggered Possible use of controlled Informed Consent Procedure for substances in Leather tanning at Certain Hazardous Chemicals and Kinanie Pesticides in International Trade

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11 Stockholm Convention on Persistent Triggered As above Organic Pollutants 12 African Convention on the Triggered Exploitation of water resources Conservation of Nature and Natural Resources (1968) 13 Convention on the Prevention of Not Kinaie area is far removed Marine Pollution by Dumping of triggered from the Marine environments Wastes and Other Matter1972 14 The Convention on Wetlands of Not There are no RAMSAR Sites at International Importance (Ramsar triggered Kinanie 1971) 15 Convention on the Protection of Not Kinanie is not a World World Cultural and Natural Heritage, triggered Heritage Site 1972, which also protects threatened plants 16 United Nations Convention to Triggered The Masterplan for LIP will Combat Desertification 1994 escalate urbanised land use to create concrete jungles Total Triggers 7

(v

i): Role of the World Bank‘s Safeguard Policies The World Bank is not be directly involved in development of the Master Plan for Leather Industrial Park currently. However, the Bank pioneered application of Safeguards towards enhancing and in-building environmental and social sustainability in development planning in which case, the safeguard polices are synonymous with international standards for environmental quality. The World Bank‘s safeguard policies are designed to ensure that projects proposed for Bank financing are environmentally and socially sustainable.

Screened against 11 World bank Safeguards (Table 3.3), the Masterplan for LIP has potential to trigger only OP 4,01 on Environmental Assessment. It is observed that the Masterplan does not target either protected or settled areas in which case, requirements for resettlement planning among other Bank requirements do not arise. Further, it is observed that once the proposed investments undergo local EIA process in line with LN 101 of EMCA, they will have fully resolved all requirements of OP 4.01. Table 3.3: Analysis of potential triggers to World Bank safeguards policies World Bank Safeguard Potential Trigger mechanism policy Triggers OP /BP4.01: Trigger Master Plan likely to promote many category

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Environmental projects which will have to undergo mandatory Assessment ESIA as specified by OP4.10 OP 4.04: Natural Not Masterplan for LIP does not target protected Habitats Triggered areas but there is wildlife in vicinity OP/BP 4.36: Forestry No Trigger As above OP/BP 4.09: Pest No trigger Project has no known interaction with this trigger Management OP/BP 11.03: Cultural No Trigger There are not culturally important sites at Property Kinanie. OP/BP 4.10: No Trigger There are no known IPs in the Route of traverse. Indigenous Peoples OP/BP 4.12: NoTrigger There is not potential for displacement as land is Involuntary owned by the proponent for LIP Resettlement OP/BP 4.37: Safety of No Trigger Project will not involve construction of dams Dams OP/BP 7.50)Projects No Trigger Mbagathi-Athi River system is a national on International waterway wholly within Kenya. Waters (OP/BP 7.60)Projects No Trigger There are no sites classified as disputed in the in Disputed Areas project area. (BP 17.50)Disclosure of Triggered Both the WB and GOK require that projects be Operational disclosed before development Information Total triggers 1

3.3: The Institutional Framework for SEA

In 2001, the Government established the administrative structures to implement EMCA, 1999 as follows:-

The National Environment Council: The National Environment Council (the Council) is responsible for policy formulation and directions for the purposes of EMCA 1999. The Council also sets national goals and objectives and determines policies and priorities for the protection of the environment.

The National Environmental Management Authority: EMCA 1999 allows for formation of the National Environmental Management Authority (NEMA) as the body charged with overall coordination of environmental protection in Kenya. A Director General (DG) appointed by the President heads the Authority established in 2001. Several Directors in charge of Enforcement, Education, Policy, who are assisted by Assistant Directors and Senior Officers under them, assist the DG. To facilitate coordination of environmental matters at District level, EMCA 1999 allowed for creation of District Environmental Committees (DEC) traditionally chaired by respective District Commissioners with specific responsibility for environmental

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management within respective jurisdictions. . However, in order to align to requirements of Kenya Constitution 2010, NEMA has devolved functions to Counties and in the process phased out District Environmental Committees. Under the New arrangement, environmental matters including licensing for specified categories of projects will take place at the County or level depending on the perceived environmental risk category. Under this arrangement however, NEMA Head Office retains regulatory control over SEA processes but requires coordination with respective County Offices.

Towards standardising conduct and management of SEA process in Kenya, NEMA has issued National Guidelines for SEA as already alluded to in section 3.22 (iv) above. This is the institutional framework under which this SEA process to which this SEA process is aligned.

Public Complaints Committee: Under EMCA 1999, a Public Complaints Committee has been established to provide an administrative mechanism for addressing environmental harm. The Committee whose membership include representatives from the Law Society of Kenya, NGOs and the business community has the mandate to investigate complaints relating to environmental damage and degradation. 3.4: Outcome from analysis of Policy Legal and Institutional framework

From analysis of the Policy, legal and Institutional framework, the potential interplaying between the Master Plan for Leather Industrial Park and mandates of other stakeholders has started emerging thus laying the groundwork for assessment of strategic impacts as outlined in Chapter Five below. Other emergent issues that need highlight include:- i) Legal parameters to be fulfilled in developing and implementing the Master plan for the Leather Industrial Park are clearly defined in both policy and law. ii) The Master Plan as currently conceived is relatively straight forward, despite targeting the Leather Sector which is sensitive on account of environmental costs. Potential legal and policy triggers in implementing the LIP have been adopted to expand the spectrum of checklists applied in impact prediction in this study and have informed development of the ESMF un veiled in Chapter Ten below. Efforts therefore, have been invested in this SEA to ensure that the Master Plan remains attuned to requirements of relevant policy and legal instruments.

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Chapter 4. Baseline Characterization This chapter presents an in-depth documentation of the receiving area for the proposed Masterplan for Leather Industrial Park.

4.1: Scoping of the potentially receiving area Baseline characterization as unveiled in this chapter was largely informed by the Scoping Phase investigations in which potential of the Masterplan to generate both local and wide spreading impacts was documented. Specifically, scope of baseline characterization for the Masterplan was informed by the implications as follows:-

Targets of the Masterplan Implications Required scope of study for Leather Industrial Park Target Sector Masterplan targets Leather National and regional which is a nation-wide based analysis of trends in sector with many already the leather subsector existing players in the value addition and distribution chain Target output Masterplan is part of the Analysis of trends in the national strategy for local national and regional economic transformation economy into a newly industrialized state by year 2030 Target Site The LIP targets Kinanie in In-depth documentation of Machakos County site conditions Target resources Implementation of the In-depth documentation Masterplan for LIP targets and modeling of water to tap water resources of supply, demand and the Athi River quality trends in the Athi catchment Potential impacts Potential adverse impacts Local and region based could spread especially on analysis and modeling of water could be felt within potential impacts on the entire Athi river basin strategic resources

Based on this analysis, it is apparent potential impacts of the Masterplan are likely to spread far and wide beyond the immediate confines of the target site which requires that the entire potentially receiving area be identified and analyzed for environmental, social and other sensitivities likely to be triggered by implementation of the proposed Masterplan. Baseline analysis thus focused on issues as follows:-

• Documentation of the Biophysical baseline for Kinanie and beyond • Documentation of the Socio-economic baseline for Kinanie and beyond • Analysis of local and national economic trends • Performance analysis for the leather sector • Documentation of emergent concerns 33

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As such, comprehensive analysis based on both secondary and empirical data was undertaken for this SEA, bearing in mind that, more detailed studies would be undertaken under context of EIAs anticipated downstream at the Master Plan implementation stage. Data collection in the SEA was restricted to unearthing basic facts, trends and process in the Master Plan area of influence with the goal of highlighting strategic priorities to be reflected in the Master Plan preparation.

4.2: The Biophysical Baseline

4.2.1: Administrative jurisdiction for the Masterplan

The Masterplan for the Leather Industrial Park as currently conceived is part of the national industrialization strategy spearheaded by the Ministry of Industrialization and Enterprise Development through the EPZA. However, the site targeted to physically locate and roll out Masterplan activities is located at Kinanie whose administrative jurisdiction is provided in 2.3.1 above.

4.2.2: Physiography, geologic and site soil conditions

Physiography: The Kinanie area falls within the general dissected Kapiti Plateau at an altitude of 1400m asl. The site is gently undulating plateau with an east-facing slope of between 1 to 2 %.

Geology and Soils: Geology for the Kinanie area has been described based on available documentation and reports [Sombroek; et al, 1982]. The Kapiti plateau is underlain by volcanic rocks of the deriving from the Cenozoic era which, in geo-chronological order, consists of the following formations:-

 Upper Athi Series  Kapiti Phonolites  Basement System

Upper Athi Series: The Upper Athi Series forms part of the extensive Athi tuffs and lake beds deriving from consolidation of fragmental volcanic material which was deposited shallowly into water after eruption. Geaverts, 1964, classify the series as all the sediments and tuffs lying between the Nairobi and the Kapiti phonolite and include beds of the Kerichwa Valley series where the phonolite and trachytes are absent. The extensive occurrence of the series in the area indicates the former presence of an extensive swampy country. The Upper Athi series consists mainly of sandy sediments, tuffs and welded tuffs, with clays being subordinate.

Kapiti Phonolite: Wherever the contacts of the Kapiti Phonolite are present, the unit underlies associated volcanic rocks and is consequently the oldest lava of the 34

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succession. The rock is distinctive in hand specimens by its large white crystals of feldspar and waxylooking nephelines which are set in a fine grained dark green to black or dark bluish-grey groundmass. This is the oldest lava flow in the area and lies directly on the Basement. The Kapiti phonolite is exposed in the valleys of Athi River, Stony Athi, Mbagathi and along Kitengela River. This is therefore, is the formation underlying the Kinanie site of the Masterplan.

Rocks of Mozambique Belt: These are crystalline rocks of Precambrian age which are exposed in the south west of Kitengela where the volcanic cover has been removed by erosion. They are predominantly biotite gneises, frequently migmatitic and rich in hornblende.

Soil data for the project site is based on a previous description of the Machakos district based on Jaetzhold and Schmidt (1983). Local soils are mainly pellic Vertisols which are basically imperfectly drained, very deep, dark grey to black, friable soils but underlain by cracking clays at 50cm depth. 4.2.3: Climate and agro-ecology

Rainfall occurrence: Rainfall occurrence in tropical Africa is associated with Inter Tropical Convergence Zone (ITCZ) which separates the north- eastern and south- eastern trade wind systems with the belt of maximum rainfall following the position of the overhead sun with a time lag of about 4 to 6 weeks. This cycle yields two rainfall seasons centred around April-May (long rains) and October-November (short rains) with intervening dry seasons associated with monsoonal dry air masses. From December to March, the persistent north easterly monsoon brings clear sunny weather with only occasional showers while, during the period of south easterly monsoon from June to October, the weather is duller and cooler with occasional drizzle which is more persistent at higher elevations.

Annual Rainfall Distribution: Table 4.1 and Fig. 4.1povide details of distribution of annual rainfall in the Kinanie area based on rainfall data recorded at Rohet Sisal Estate (9137082) located within 6 kilometres of the LR 23961 at an altitude of 1529m above sea level. On account of the low lying nature of the Kinanie area, far removed from any relief barrier, annual rainfall is generally low, averaging 600mm.

Annual rainfall follows a double maxima pattern with ―long rains‖ falling from March to May and ―short rains‖ from October to December. In terms of rainfall content, April, May and November are the wettest months accounting for over 54% of the annual rainfall inputs. The period October to January however promises some favourable moisture regime which is only separated from the long rains by a bare 2 month drought. The short rain season is thus the most viable for establishment of rain fed investment. On the contrary, the long rains are followed by a long dry season lasting June to September during which, moisture limitation poses a major constraint to ecological productivity. Overall, analysis of moisture indices indicates that the area generally suffers a moisture deficit.

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Table 4.1: Climatic data for the project area based on Rohet Sisal Estate Rohet Month Annual Sisal Mean J F M A M J J A S O N D Estate (mm) Rainfal 51 35 59 113 97 17 6 9 16 41 12 51 614 l 0 PET 22 21 23 17 13 114 113 12 16 21 17 192 2073 1 8 3 2 4 3 5 6 2

Agro-climatic potential: In terms of long-term moisture balance, the project area experiences high evaporation demand estimated at 2073mm annually. Rainfall never exceeds potential evaporation in any one month implying that the area suffers a perennial moisture deficit throughout the year (Fig 4.1). The climatic value of rainfall has been analysed based on computation of the climatic index as determined by the ratio of rainfall (r) to potential evapo-transpiration (Eo) based on the method of Sombroek et. al, 1982.2 With a mean annual rainfall of 614 mm and a corresponding potential evapotranspiration of 2073 mm, Kinanie area has an aridity index (r/Eo ratio) of 0.29 implying prevalence of a semi-arid climate while the agro-ecological potential (AEZ) based on agro-climatic zonation as refined by temperature belt is given as upper Midland Zone Six- UM6 (Upper Midland ranching Zone). The implication of such climatic classification is that inadequacy of moisture is the single most important constraint to rain fed crop production; a factor that accounts for the previous land-use pattern dominated by ranching and sisal production and the current practise of irrigated agriculture in sections of the project area.

In terms of the local hydrology, inadequacy of moisture greatly undermines recharge of ground water from direct rainfall and recharge possibly takes place from further up in the Lukenya escarpment where seasonal moisture regime is more favourable and where occult precipitation is also likely to occur. Indeed, this is confirmed by the apparent artesian nature of all boreholes operational in the Kinanie area. Some recharge also probably occurs from the rocky bed of the Athi especially in sections where the rock is fractured.

2

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Source: This Study Fig 4.1: Agro-climatology of the Kinanie area

4.2.4: Vegetation: The vegetation of the area is originally savannah bushland dominated by Acacia /Commiphora trees in association with Themeda triandra grass. Overtime, the original woodlands have been thinned out to create generally open savannah grassland devoid of trees. Part of LR 23961 is however under an Eucalyptus plantation whose performance is also constrained by aridity.

4.2.5: Hydrology and Drainage

Drainage System: The Kinanie site proposed for development of a Lather Industrial Park is situated within the drainage of the Mbagathi tributary (3AA) of Athi River (Fig 2.4). Downstream of Kinanie, Mbagathi joins the Stony Athi to form the Athi River which is later on joined by the upstream of Donyo Sabuk and later receives the Kaiti/ Thwake System and the upon which it continues flow as the Galana and later enters the Indian Ocean North of Malindi as the Sabaki. Mbagathi tributary therefore, is among the major contributors of flow which sustains economic and ecological systems in downstream areas of Drainage Basin Three. Specifically, the Athi River downstream of Donyo Sabuk traverses semi-arid country in Machakos, Kitui, Makueni and Kilifi Counties where it provides a critical lifeline as a source of water for domestic and agricultural use in addition to supporting wildlife and tourism in the Tsavo National Park while the Baricho well field supplies the bulk of water consumed in Malindi, Kilifi and parts of North Coast Mombasa.

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Kinanie site

Source: JICA 1992 Fig 4.2: Location of Kinanie in the Athi Basin

Flow characteristics Official records of the seasonal mean naturalised discharge patterns of the Mbagathi River based on the Water Masterplan (JICA, 1992) are reproduced in Fig 2.5 below. Mbagathi flow displays a double maxima pattern with 2 flood seasons in April-May and November separated by a low flow period in July to October in tandem with the rainfall occurrence pattern. Thus typical of rivers draining the Kapiti plains (Kiserian, Isinya, Stony Athi and others), the Mbagathi experiences flash floods during which the bulk of rainwater is lost followed by periods of low to no flow immediately the rainy season ceases, a situation associated with the poor water holding capacity of vertic clays which dominate the Kapiti plains. Such poor catchment characteristics would explain the comparatively low yield observed for boreholes in the Kapiti Plains (Section below) on account of very poor aquifer recharge.

Significantly however, though records indicate a sustained annual flow in the Mbagathi, reality on the ground however is that, flow in the river ceases immediately after the rains possibly reflecting adverse impacts of over-abstraction upstream. 38

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Source: This Study and JICA, 1992 Fig 4.3: Flow characteristics for the Mbagathi River

4.3: Socio-Economic Baseline 4.3.1: Administrative jurisdiction

According to the Machakos County Development Profile, Machakos County is divided into eight sub-counties (Machakos, Kangundo, Matungulu, Kathiani, Yatta, Masinga, Athi River and Mwala) which are further sub divided into 22 divisions, 71 locations and 233 sub locations all covering 6,208 square kilometres of land. Kinanie is situated within the Athi Rive sub county.

4.3.2: The inhabitants

The Kinaie area falls within Machakos County, naturally inhabited by the Kamba tribe. Even in the more cosmopolitan Athi River Town, the Kamba is still the dominant community.

4.3.3: Population and settlement patterns

(i) Population dynamics

As at the 2009 population Census, Machakos County had population of 1,098,584 people spread in 215,209 households and was projected to grow by 1.58% to reach 1,238,650 by 2015 (Table 4.2 below). Mavoko SC which includes Kinanie had a population of 139,502 projected to grow to 157,288 by 2015. With the exception of Kinanie Market, potential density is moderate, generally between 150 to 200 persons per square kilometer.

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(ii) Age disaggregation of county level population

Fig 4.4 presents a disaggregation of population data by age cohorts based on the 2009 National Census. 62% of the population is below 24yrs and is therefore considered youthful. On pro-lata basis therefore, this is the population that enters the job market at a rate of 2.6% Table 4.2: Projected population for Machakos County Constituency 2009 (Census) 2012 (Projections) 2015 (Projections) 2017 (Projections) Male Female Total Male Female Total Male Female Total Male Female Total Masinga 61,106 64,834 125,940 64,885 68,843 133,728 68,897 73,100 141,997 71,709 6,083 147,792 Yatta 71,338 76,241 147,579 75,749 80,955 156,705 80,433 85,961 166,395 83,716 89,470 173,186 Kagundo 46,615 47,752 94,367 49,498 50,705 100,202 52,558 53,840 106,398 54,703 56,037 110,741 Matungulu 61,616 63,120 124,736 65,426 67,023 132,449 69,472 71,168 140,639 72,307 74,072 146,379 Kathiani 53,190 50,307 104,217 56,479 53,418 110,661 59,972 56,721 117,504 62,419 59,036 122,300 Mavoko 72,163 67,339 139,562 76,625 71,503 148,128 81,364 75,925 157,288 84,684 79,023 163,707 Machakos 97,449 101,762 199,211 3,475 8,055 211,530 109,873 114,736 224,610 114,357 119,419 233,776 town Mwala 78,942 84,090 163,032 83,824 89,290 173,113 89,007 94,811 183,818 92,639 98,681 191,320 Total 543,139 555,445 1,098,584 76,725 589,792 1,166,517 612,388 626,262 1,238,650 637,380 651,821 1,289,200

(or higher) of total population per annum meaning that the job market has to expand in the equivalent. As it were, on account of constraints imposed by aridity, employment rates in the county are soaring high. According to the Machakos County Strategic Framework Paper, 51 % of county residents are unemployed and are therefore an economic burden. The juvenile and adolescent category aged 5-24 years form the bulk of the population at 59% resenting the most expensive segment of society who in addition to being fed and clothed also attend school and colleges which imposes a huge economic burden on the working population whose productivity in agriculture is constrained by aridity. This probably explains the GOK motivation to provide free primary and secondary education so as to cushion poor parents from further impoverishment by the school fees burden.

Source: Machakos County Strategic Framework Fig 4.4: Segregation of population by age

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4.3.4: Baseline profile specific to Kinanie

4.3.4.1: Population and settlement patterns

Background: The entire Kinanie Division is formerly a Group Ranch owned by the Lukenya Ranching and Housing Cooperative Society that used to specialize in dairy, sisal and irrigated agriculture along the Mbagathi River. The Ranch was later subdivided into 5-40 acre plots and allocated to members some of whom have further sub divided and sold off their land.

Settlement density: Going by the 2009 National Population Census, Kinanie location had a population of 7,069 people distributed in 214 households in a land area of 129.3 square kilometres.

Population data Density characteristics Male Female Total Households Area (sq. km) Density 4024 3045 7069 214 129/3 56

Source: This Study Plate 4.5: The Kinanie Market

Land use and livelihoods:

The Kinanie area has all features of a newly settled area;- barbed wire fence around properties, immature exotic trees especially around hedges and many yet to be developed land parcels. For those that are settled, agro-pastoralism entailing keeping of local livestock breeds supplemented both rained and irrigated agriculture are the main means to livelihood. Other economic drivers in the area include trade at Kinanie Market, irrigated commercial horticulture and employment in horticultural farms such as Waridi Ltd.

4.3.2: Physical Infrastructure

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Public amenities: Kinanie is currently served by 8 schools out of which, 2 (a primary and secondary school) are public sponsored (Table 4.3) and though the area does not have a single public college, the daystar University is situated within the Division.

Table 4.3: Tally of public service provides at Kinanie Nature of service Public Private Total provider Public Primary Schools 1 6 7 Public Secondary Schools 1 0 1 Tertiary colleges None Churches 6 Health Centers 1 1 2 Public Water supply 1 BH 1 Source: This Study

Utilities – Water and Sewerage: The dominant infrastructure at Kinanie is the sewer- line and sewage treatment plant operated by the EPZA. Water supply to Kinanie is mainly from community and privately owned boreholes.

Power supply: Kinanie area is served by several three-phase electricity which serve the neighbourhoods including, homes, market, schools, boreholes and other facilities.

4.3.3: Status of Socio-welfare Poverty levels in the Machakos County are at 59.6 % against a national average of 47.2% based on KIHBS (2009); this positions the County at 33 out of the 47 counties, while 52% of the population lives in the urban centers, which is way above the national average of 29.9%. There is a high increase in labour force which has led to increase in unemployment and this could lead to escalation of crimes as a result of non-absorption of this active population in gainful employment. This scenario coupled with the fact that the 51% of the Machakos County citizen are considered as economically inactive implies that the County is in need of investments to spur growth and reverse the situation.

4.4: Analysis of local and national economic trends

4.4.1: The Perspective Development of the proposed Leather Industrial Park is motivated by the need to tap the economic potential locked-up in the resource as a driver towards achieving 42

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accelerated GDP Growth. In this section, an analysis of the economic background to development of the Masterplan for LIP is provided

4.4.2: Review of economic performance

Figure 4.5 below traces trends in economic performance between 2009 to 2014, a period during which, economic growth slowed down hitting 1.8% in 2008 before rising to 2.9% in 2009 on account of global turbulence, the negative electoral shocks in 2008 and severe drought conditions, which curtailed the country‘s growth potential. However, the economic stimulus programme implemented in 2009/10 cushioned the economy from complete recession leading to rebounding up 5.8% before slowing down to 4.4 percent in 2011. In 2012-13 the economy started recovering and grew by 4.6- 5.7% before dropping to 5.3% in 2014. On the other hand, the per capita income grew by 0.6 percent in 2010 to 6.1 percent in 2010, before experiencing a sustained decline upto the year 2012. In 2013, it recovered to register a growth of 2.9 percent and 2.4 percent in 2014. However, with population growing at 2.4 percent alongside insignificant growth in real per capita income, poverty remains a real challenge.

Source: This Study Fig 4.5: Past trends in GDP growth

4.4.3: Analysis of sectoral performance An in-depth performance analysis for the leather sector is provided in Chapter five below. In sections below, an analysis of performance for core sectors of the national economy is provided as a background to mapping the potential impact of promotion of value addition in the leather sector. Animal Production The national resource base for the leather sector is an estimated population of 17.5 million cattle, 27.7 million goats, 17.1 million sheep and 3.0 million camels supplemented by newly emerging sources namely fish (Nile perch), farm ostriches and farm crocodile. Fig. 4.1 traces trends in animal production over the last five years. Animal farming grew by 6.0 percent in 2010 before dropping to 0.4 percent in 2011, there after 43

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recovering in 2012 to record a growth of 2.2% before dropping again to 0.2% in 2014. On the other hand, the fishing sector has sustained impressive growth possibly attributed to the economic stimulus programme under which, fish farming was promoted. From 2009, fish farming grew from 3.8 to 10.4% cent in 2011 but thereafter slowed to 5.1% and 2.9% in 2012 and 2014,respectively. In terms of contribution to GDP, both the animal farming and fish farming sectors have a contribution of about 6% of which animal production account for 5%.

Source: This Study Fig 4.6: Past trends in GDP growth

Agriculture and Forestry The Kenyan agricultural sector directly contributes 24% of GDP and indirectly a further 27% through linkages with manufacturing, distribution, and other service- related sectors. The sector produces the bulk of the country's food requirements in years of favourable weather, but there are emerging chronic deficits in maize, wheat, rice, sugar and edible oils. The agricultural sector accounts for 75 percent of rural employment with women providing 75 percent of the labour force. The sector contributes 65 percent of export earnings, 45 percent of annual government revenue, and produces almost all the raw materials for agro-industries. The crop sub-sector provide raw materials used in the manufacturing of animal feeds.

Fig 4.7 provides an analysis of past performance in the agriculture and forestry sector. In 2009, the sector registered a negative growth of 2.6% mainly due to disruption occasioned by the post-election crisis of 2008, thereafter recovering steadily to record a growth rate 10.1% in 2010. In the subsequent years the sector experienced slow growths.

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Source: This Study Fig 4.7: Past trends in growth of the Agriculture and Forestry sector

The poor performance of the agricultural sector has been widespread affecting almost all agriculture-related activities in crop and livestock production and marketing. With the exception of horticulture, which has maintained an impressive growth trend, growth in all key cash crops has nose-dived. Most notable is coffee, which has moved from its position as the country‘s highest foreign exchange earner to the fourth position. Food crops have also not performed well, and neither have the beef and dairy industry.

A major national development objective of the agricultural sector is to increase rural incomes through production of marketable surpluses, high value crop and livestock products, processing to add value, and stimulation of off-farm activities to create employment. Rural income generation will be achieved through several fronts, namely, creating opportunities for increased production and marketing, strengthening research and extension linkages, storage facilities, livestock production, value-added activities for agricultural products, credit, strengthening farmer associations, building market space for smallholders, and food/cash for work for the landless and the employed. Manufacturing Leather is a sub-sector of manufacturing, a major economic driver in Kenya. Leather industry also draws some of the inputs from the wide manufacturing sector eg chemicals. Manufacturing accounts for over 10% of the total GDP in the Kenya but has been experiencing instability in past years having risen to 7.2% in 2012 up from 1.3% in 2009, but later dropping to negative 0.6% in 2013 and 5.6 and 3.4% on 2013and 2014 respectively (Fig 2.7).

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Source: This Study Fig 4.8: Past trends in grow of the manufacturing sector

4.5: Pre-existing and emerging social and environmental concerns

This section provides a highlight of the environmental and socio-economic sensitivities preceding implementation of Masterplan activities at Kinanie. These are the concerns likely to be compounded by the Masterplan and which failure to resolve may be costly to both, the Masterplan and the national economy.

4.5.1: Nuisances and hazards associated with the sewerage treatment plant All sewage and industrial effluent from the EPZA complex at Kitengela is conducted through a 16km pipeline to a commercial size sewerage plant at Kinanie where it is treated before release into Mbagathi River. Like all other sewerage plants, its location in settled neighbourhoods is never welcome on account of the foul smell, hazard of communicable diseases etc associated with sewerage. At Kinanie, the problem is compounded by presence of emergence of a group of private motorised sewerage service operators who exhaust septic tanks ostensibly to discharge at the treatment plant but who will often discharge at the nearest manhole or isolated spot to save on costs. This group is accused of vandalising septic covers to create new discharge points and in the process expose locals to diseases and accidents from the open manholes while their trucks are blamed for the dilapidated road condition.

The sewage plant is a fervently sore and weighty matter which casts the EPZA in adverse light at Kinanie. It is a matter likely to undermine local confidence in capacity and goodwill of the EPZA to effectively oversee implementation of the environmental and social management plan in the leather industrial park. The SEA Team has already engaged the EPZA on the need to resolve matters associated with the sewerage infrastructure.

4.5.2: Increasing Pollution load into Mbagathi The EPZA pipeline to the sewerage plan serves establishments some of whom are outside control of the EPZA but who discharge liquid effluent that does not meet local standards for discharge into public sewers. Analysis of monitoring data available with 46

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the EPZA (Tables 4.4 and 4.5) reveals presence of very heavy COD, BOD and TDS loading into the EPZA sewerage system mainly emanating from Athi River based tanneries and which is ultimately released into the environment mainly the Mbagathi River. Further, depending on the season, some pollutants exit the system without having been diluted (Table 4.5) and thus ultimately straining the receiving environment. As such, generation of additional liquid effluent into the Mbagathi system as anticipated at Kinanie would compound an already strained system.

Table 4.4: Findings from analysis of effluent born of the EPZA sewer treatment system Tests Method Findings for different sampling points (April 2015) EPZA ALPHA Treatment Treatment outlet RAMA Pond Inlet Pond Outlet pH SGS TW 17 6.51 7.62 7.92 6.93 BOD 5@20◦ C SGS TW4 020 120.64 95.28 220.68 99.94 Total suspended APHA 2540 13 6 6 2 solids Chemical APHA 5220D 264.18 183.41 443.88 192.16 oxygen demand Colour APHA 2120 B [>70] [>70] [>70] [>70] Oil and greases SGS TW 6 Nil Nil Nil Nil Anionic APHA 5540 C Nil Nil Nil Nil surfactants as MBAS Total phenols APHA 5530 D <0.001 <0.001 <0.001 <0.001 Lead as Pb APHA 3120 B not Not Not Not detected detected detected detected Chromium as Cr APHA 3120 B <0.007 0.97 0.38 <0.007 Mercury as Hg SGS TW 12 not Not Not Not detected detected detected detected Total dissolved SGS TW 21 783 [35100] [13020] 1689 solids Source: EPZA Records

Table 4.5: Findings from analysis of effluent born of the EPZA sewer treatment system Tests Method Findings for different sampling points (July 2015) EPZA ALPHA Treatment Treatment Outlet RAMA Pond Inlet Pond Outlet Ph SGS TW 17 6.66 [5.31] 7.32 7.91 BOD 5@20◦ C SGS TW4 [226] [88.56] [245] [289] 020

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Total suspended APHA 2540 6 3 8 11 solids Chemical oxygen APHA [443] [181] [480] [571] demand 5220D Colour APHA 2120 [>70] [>70] [>70] [>70] B Oil and greases SGS TW 6 Nil Nil Nil Nil Anionic surfactants APHA 5540 Nil <0.01 Nil Nil as MBAS C Total phenols APHA 5530 <0.001 <0.001 <0.001 <0.001 D Total dissolved SGS TW 21 782.4 [1969.10] [4458.00] [6870.00] solids Mercury as Hg SGS TW 12 Not Not Not Not detected detected detected detected Chromium as Cr APHA 3120 <0.007 <0.007 0.14 0.43 B Lead as Pb APHA 3120 Not Not Not Not B detected detected detected detected Source: EPZA Records

A major observation from the EPZA monitoring data however, is the total elimination of heavy metals, notably Chromium from liquid effluent discharged from some tanneries. This finding singularly provides hope in the capacity for application of technology in resolving pollution concerns associated with tanneries.

4.5.3: Increasing pollution load into the Athi System The Athi River system serves the Cities of Nairobi and Mombasa and three major towns of Thika, Machakos and Malindi and is thus a major economic enabler. Numerous studies in the past have sought to document quality concerns emanating from the passage of Athi River tributaries notably Motuine-Ngong, Nairobi, Mathare, Gatharaini etc through Nairobi and its slums, where modalities for waste disposal are quite wanting. Notable among these are the studies by Kithia SM in 2003 who documented chronological increase in pollution loading within the Nairobi River as it traversed the city between the Museum area and Njiru (Table 4.6). That the Nairobi River is heavily polluted is not in questions. By the time Nairobi exits the city, it is carrying thousands of tons of pollution load which it delivers to the already polluted Athi River thereby comprising quality of water available for downstream use.

While it is beyond the scope of the EPZA to control pollution loading within the Athi System, the challenge is for all concerned to adopt a water tight system for effluent

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reduction within the Masterplan area as a strategy minimize on cumulative pollution loading into this vital lifeline.

Table 4.6: Observed evolution of pollution load in Nairobi River through the City traverse

Source: Kithia SM (2006)

4.5.4: Increasing exploitation pressure on water resources Water is a core strategic resource whose availability or otherwise dictates trends and pace of economic development. At national level, Kenya is classified as a water scarce country with a per capita endowment of approximately 696 m3 per person per year against the global benchmark of 1,000 m3 per person per year. That the Athi River basin is a water scarce zone is exemplified by the fact that, Nairobi is supplied from far catchments such as Nor Turesh (Kilimanjaro catchment of Athi basin), Sasumua and Ndakaini Dams in the Tana basin and the newly proposed Northern Collector targeting the Irati, Mathioya and Maragua rivers in the Upper Tana catchment. Closer home at Kinanie, flow of the Mbagathi river is currently seasonal on account of poor flood storage capacity and possible over abstraction which makes it a dry river bed with absolutely no potential to support large-scale investments heavy on water demand.

Potential water demand in diverse capacity tanneries is analysed in Table 4.7 below based on a base consumption of 50cubic metres per tonne of hides and skins. Essentially, operationalization of 36 tanneries of the Alpha Rama category would impose an additional annual water demand in the range of 40 million cubic metres equivalent to 17.1% of the current demand for Nairobi City. When the water demand in support services is factored in, the resultant scenario informs the need for a major intervention in water supply.

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Table 4.7: Projected water demand in operationalization of 36 tanneries Tannery size Capacity Water use Monthly Monthly Annual Annual (tons/ m3 per ton water demand for water demand by month) demand 36 tanneries demand 36 tanneries per tannery Large 1850 50 92,500 3,330,000 1,110,000 39,960,000 Medium 900 50 45,000 1,620,000 19,440,000 540,000 Small 450 50 22,500 810,000 9,720,000 270,000 Equivalent water 650,000/da 19,500,000 234,000,0 demand in y 00 Nairobi Ratio of 17.1% 17.1% Tannery to Nairobi demand Source: This Study

In exploring option to supply water at Kinanie, exploitation of groundwater has been floated as one option. However, based on previous experience, groundwater in the Nairobi area is complex comprising a series of minor aquifers occurring within the thin overburden overlying the Nairobi trachytes, and in the interfaces and fracture zones within the various volcanic strata. The main aquifer is however within the Upper Athi series starting from depths of 120m below ground level. Though a sort of a regional aquifer within the Upper Athi series underlies the area, records indicate that borehole yields vary but generally approximate 1.5m3 /hr (Table 4.8 below) which casts doubts on their viability in meting potential demand at Kinanie.

Table 4.8: Data for boreholes within Kinaie area Borehole Distance and bearing Total depth WSL WRL (m) Yield Quality No. (C.) from Kinanie (m) (m) (m3/hr) 72 2.8/SSW 135 35/130 16 2.5 Good 2527 2.5/ENE 31 17,20,2 14 1.3 Good 4 9954 3.0/SW 75 46,64 7 0.6 Good

Other concerns are centered on observed drastic increase in number of boreholes exploiting the Upper Athi Aquifer in Nairobi and environs (Fig 4.9) raising fears of a possible draw down and dewatering.

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Source: Fig 4.9: Spatial distribution of boreholes in Nairobi (Yellow line demarcates the Mbagathi catchment)

4.5.6: Cross-cutting issues The Machakos County Development Profile 2013 identifies many cross cutting issues namely;- high levels of poverty, high prevalence of HIV and AIDs, Gender inequality, Youth, People living with disabilities, environmental degradation and climate change, disaster preparedness as priority issues in development planning. The same will be investigated within the context of planning for the proposed Leather Industrial Park.

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5. LEATHER, HIDES AND SKINS SECTOR IN KENYA

5.1: Sector performance

5.1.1: Introduction

The leather industry in Kenya is mainly dependent on the large livestock resource base with an estimated population of 17.5 million Cattle, 27.7 million Goats, 17.1 million Sheep and 3.0 Million Camel. The industry also derives its raw materials from emerging livestock such as fish (Nile perch), farm Ostriches and farm Crocodiles. Goats provide the highest percentage of skins with the least obtained from fish based on the comparative analysis of data provided by the Ministry of Industrialization and Enterprise Development.

The leather industry in the country has faced many challenges which led to near collapse of the industry. Liberalization of the leather market in 1990‘s which came with the abolition of the 22 percent export compensation scheme, resulted in exportation of 80 percent of the total raw materials causing a major shortfall in the local market. This resulted into closure of some of the factories and unutilized capacity because of lack of adequate law materials. Tens of thousands of jobs and incomes were lost as the tanneries closed, and the government lost revenues. Before then, Kenya‘s leather industry which was made up of raw material (hides and skins), tanneries, footwear, and leather goods manufacturing thrived.

In 2012, the Government started putting measures and strategies to save the sector from complete collapse. Export tax was increased from 40 percent to 80 percent, resulting to significant decline in the export of hides and skins by about 80 percent to date.

To create local demand, the Government announced that the Kenyan armed forces will be buying boots from local manufacturers. The Government has also developed a five-year plan to make Kenya the leather hub for East and Central Africa using the export duty model. In the 2014/15 budget, the Government allocated Sh3bn ($34m) for the development of the textile and leather sectors.

There are currently 14 tanneries operating in the country and more recently, the government announced plans to establish six abattoirs and tanneries in various counties to boost production of hides and skins.

Kenya has also embarked on a campaign to woo investors, and Italy is one of the countries being pursued with an offer of a 10-year corporation and withholding tax holiday and a 100% investment deduction on investments over 20 years.

Currently, the estimates indicate demand for shoes is at 42 pairs an year but local producers manufacture 3.3m units per year. With demand outstripping supply, Kenya

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imports 85% of the units and is the second-largest importer of footwear and leather products in Africa after Egypt.

5.1.2: Production trends in the Kenyan Leather Sector

Currently, tanneries in Kenya have installed capacities standing at 60 percent for wet- blue, 25percent for crust leather and finished leather taking 15percent. There are currently 14 tanneries operating in the country and more recently, the government announced plans to establish six abattoirs and tanneries in Wajir, Garissa, Makueni, Isinya, Mogotio and Kanduyi, hiking the number of tanneries in the country to 20, the largest in Africa.

Hides and Skins Sub-sector The hides and skins trade has gone through phases, with positive impact on the sector. The sector transformed from a purely raw material source to relatively modern industry adapting to changing technology and market trends, a transformation which saw the country act as a tanning hub for the region through production and supply of hides and skins, and leather, in both local and regional markets. In addition, semi processed leather (wet-blue) have been exported to international markets.

Production data for the Hides and Skins in Kenya is not readily available. However, based on sales data (Table 5.1), inference on production trends has been made. The value of marketed hides and skins increased from Ksh 1.4 billion in 2011 to Ksh 1.53 billion in 2012, an increase of 9.5 percent. The value further increased by 23.8 percent in 2013, over those of 2012, but stabilized to register a marginal growth in 2014.

Table 5.1: 6 year (production and) sales data for hides, skins and leather in Kenya Year Value (Ksh Quantity Square Value(Ksh Million) (Square feet) metres Million) 2009 1,249 7,218,837 671,352 568.20 2010 1,092 9,480,226 881,661 783.50 2011 1,392 10,805,693 1,004,929 892.20 2012 1,525 8,754,401 814,159 1,121.40 2013 1,888 9,035,215 840,275 1,220.40 2014 1,889 10,022,598 932,102 1,247.30 Source: Kenya National Bureau of Statistics

The Leather Subsector Table 5.1 shows production of finished leather and corresponding sales volume. Leather production in Kenya increased from 9.5 million square feet in 2010 to 10.8 million square feet in 2011, before declining to 8.8 million square feet in 2012. Production later improved to 10.0 million square feet during 2013 and in 2014. 53

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The value of finished leather has been increasing during the period under review to over Ksh 1 Billion since 2012. This shows the potential of the sector in terms of job creation and poverty alleviation.

Leather Goods and Footwear Subsectors The leather goods and footwear subsectors in Kenya have exhibited a lot of potential for growth with an increase of leather goods units to 85. There are 25 enterprises engaged in formal footwear and leather goods manufacturing with a combined utilization capacity in excess of 70%. Apart from the formal sector, there are hundreds of informal footwear manufacturing units/ small and micro-enterprises (SMEs) which undertake manufacturing of 55-60 percent of the local footwear production. Role of the Leather Sub Sector in the Manufacturing Sector Impact of leather manufacturing in the broader manufacturing sector remains below 2% over the period under review abeit with some improvements in some years (Table 5.2). Contribution to manufacturing GDP increased from1.3 to 1.6% between 2011 and 2012 on account of the recent reforms in the sector later rising marginally to 1.8% in 2013-2014.

Table 5.2: Contribution of Leather s/sector to manufacturing GDP Year Total Value addition % Manufacturing (Ksh in leather and Contribution million) related products 2009 342,531 5,559 1.6 2010 357,957 5,449 1.5 2011 383,890 4,808 1.3 2012 381,750 6,181 1.6 2013 403,128 7,200 1.8 2014 416,891 7,376 1.8

Source: Kenya National Bureau of Statistics

Contribution of the Leather sub-sector to National GDP As indicated above, in 2012, the Government started putting measures and strategies to save the sector from total collapse. These measures include, increasing export tax from 40 to 80%, buying boots for the Kenya Armed Forces from local manufacturers and construction of 6 additional tanneries to increase the number to 20 to mention a few. As a result, the sector has shown signs of recovery with the gross value added from the leather sector increasing by 28.6% from Ksh. 4,808 million in 2012 to Ksh.

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6,181 million in 2013 (Table 5.3). The Sector‘s contribution to GDP remains low at 0.2% annually indicating the need for concerted effort to exploit this available potential. However, other studies indicate that, the sector‘s contribution to Kenya‘s economy directly and indirectly currently stands at Kshs.10.6 billion from the 14 existing tanneries and over 85 leather goods/cottage units in Kenya.

Table 5.3: GDP Contribution by the Leather Sector Year National GDP at Value Added for %GDP Market Prices Leather Sector, Contribution (Ksh. Million) gross (Ksh.Million) 2009 2,863,750 5,559 0.19 2010 3,104,303 5,449 0.18 2011 3,294,026 4,808 0.15 2012 3,444,066 6,181 0.18 2013 3,639,938 7,200 0.20 2014 3,833,876 7,376 0.19 Source: Kenya National Bureau of Statistics

Employment in the Sector Data on gross employment in the 14 tanneries in Kenya remain un-clarified. While official records indicate a gross employment slightly in excess of 1,000 persons over the years, investigations in this study revealed a gross employment of 850 persons in one tannery alone. Indeed, other studies indicate that, the sector creates employment to over 22,540 people directly and in the 14 existing tanneries, over 85 leather goods/cottage units in Kenya and other enterprises engaged in leather related businesses.

5.1.3: Trends in Exports from the Leather sub-sector

Export of Hides and Skins

Liberalization of the leather market in 1990‘s which came with the abolition of the 22 percent export compensation scheme, resulted in exportation of 80 percent of the total raw materials causing a major shortfall in the local market. To save the local industry, the Government increased the export tax from 40 percent to 80 percent as one of the strategies to cut down exports, increase raw materials for local industries and revive the once vibrant industry.

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Table 5.4 provides export data for hides and skins. Export of hides and skins slumped by 72.2% from 10,200 tonnes in 2012 to 2,832 tonnes in 2013 and later dropped to 2,560 in 2014 on account of the increase in export tax from 40 to 80%.

With declining exports, it is expected that the local factories will have enough raw materials for manufacture of leather products and the GoK has put in place corresponding measures such as promoting the culture of buying locally manufactured shoes with the intention of creating a market for the finished leather products. Some of these measures include buying boots for the armed forces from the local producers.

In addition, the government plans to introduce import duty on all second hand shoes, instead of using the current weight per consignment method. This is expected to raise the cost of second hand shoes and hence reduce demand and subsequently increase that of locally manufactured shoes. Table 5.4: Past trends in export of Hide/Skins and Leather Year Hides and Skins Leather Quantity Value Quantity Value (Tonnes) (Ksh (Tonnes) (Ksh Million) Million) 2009 717 30 13,957 2,237 2010 322 11 22,272 4,192 2011 2,250 108 26,485 7,208 2012 10,200 504 22,698 7,036 2013 2,832 134 26,542 8,491 2014 2,560 126 26,213 7,597

Source: Kenya National Bureau of Statistics

5.2 Leather Exports Despite the Government efforts to reduce exports of leather, the exports rose by 16.9 percent from 22,698 tonnes in 2012 to 26,542 tonnes but declined marginally by 1.2 percent in 2014 (Table 5.4).

5.3: Analysis of potential for growth in the Leather Sector

5.3.1: Livestock Resources base

Regional Dimension The Kenyan livestock resource base is perpetually influence by influxes from surrounding ten countries of Eastern Africa which have a rich livestock resource base which by 2011 consisted of 120.53million heads of cattle, 11.6million camels,

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106.65million goats, 78.41million sheep and 3.97million pigs (FAOSTAT 2013) as summarized in Table 5.5 below. Table 5.5: Livestock Resource Base in Neighboring Countries Country Cattle Camels Goats Sheep 2011 2011 2011 2011 Burundi 654 2,286 332 Djibouti 296 70 512 468 Eritrea 2,065 350 1,750 2,281 Ethiopia 53,382 1,102.20 22,787 25,509 Kenya 18,174 3,091.20 28,861 17,822 Rwanda 1,143 2,971 829 Somalia 4,850 7,000 11,500 12,000 S.Sudan 10,560 11,536 10,868 Uganda 8,103 9,251 1,902 Tanzania 21,300 15,200 6,400 Total 120,527 11,613 106,654 78,411 TLU 2011 84,369 11,613 10,665 78,411

Although most of the influxes are through unrecorded informal cross-border trade, it has been estimated that 22-25% of meat consumed in Kenya is from imported livestock on-hoof through porous borders. Kenya‘s Livestock Resource Base and Projections In 2009 census, the Kenyan livestock resource base comprised of 17.47million cattle (14.11 million indigenous and 3.36million exotic), 17.13 million sheep, 27.74million goats and 2.971million camels (Table 5.6 below).

Table 5.6: Kenyan Livestock Resource Base (2009) Cattle % Sheep % Goats % Camels % Nairobi 54,546 0.3 34,717 0.2 46,837 0.2 20 na 1 Central 1,125,90 6.4 664,237 3.9 531,209 1.9 231 na 5 Coast 959,965 5.5 467,439 2.7 1,570,728 5.7 51,045 1.7 Eastern 2,260,16 12. 1,890,89 11 4,729,05 17 248,634 8.4 1 9 8 7 N. E 2,775,20 15. 4,264,15 24.9 7,886,58 28.4 1,700,89 57.2 8 9 5 6 3 Nyanza 1,748,67 10. 495,055 2.9 961,269 3.5 59 na 0 0 R. Valley 7,479,80 42. 9,079,38 53.0 11,750,52 42.4 968,192 32.6 7 8 0 1 57

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Western 1,063,51 6.2 233,725 1.4 263,946 0.9 2,037 0.07 2 Kenya 17,467,7 100 17,129,60 100 27,740,15 100 2,971,111 100 74 6 3

In terms of all cattle, Rift Valley accounted for 42.8%, North Eastern 15.9%, Eastern for 12.9% and the rest in other provinces. Exotic cattle distribution showed that Rift Valley had 46.5%, Central at 23.8%, Eastern at 11% and the rest in other provinces. Of the 17.1million sheep, Rift Valley had 53% and North Eastern 25% while other areas accounted for 22% of total. Of the total goats population of 27.74million, Rift Valley accounted of (42.4%), North Eastern (28.4%) and Eastern (17%) accounted for most goats (88%), North Eastern (57.2%) and Rift Valley (32.60%) accounted for almost 90% of the camel population of 2.971 million. Growth rate projections were based on 3.3% p.a. for all cattle (3% for exotic), 3% for sheep, 7% for goats and 2% for camels. Based on these estimated growth rates, the estimated livestock projections for 2010-2020 are as shown in Table 5.7 below.

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Table 5.7: Projected Livestock Production (2010-2020) Total Cattle Local Dairy Sheep Goats Camels cattle Kenya 17,467,774 14,112,367 3,355,40 17,129,606 27,740,15 2,971,111 7 3 GR % 3.3 3.3 3.0 3 7 2 2010 18.04 14.58 3.47 17.64 29.68 3.03 2011 18.6 15.05 3.58 18.17 31.75 3.09 2012 19.25 15.56 3.70 18.71 33.98 3.15 2013 19.89 16.06 3.82 19.28 36.36 3.22 2014 20.55 16.6 3.94 19.85 38.9 3.28 2015 21,22 17.15 4.07 20.45 41.63 3.35 2016 21.92 17.71 4.20 21.06 44.54 3.41 2017 22.65 18.3 4.35 21.70 47.66 3.48 2018 23.39 18.9 4.49 22.35 51.0 3.55 2019 24.17 19,52 4.64 23.02 54.57 3.62 2020 24.96 20.17 4,80 23.71 58.3 3.69

Based on these figures, it is estimated that currently (2015), there are 21.2million heads of cattle (17.15 indigenous and 4.07million exotic), 20.45million sheep, 41.63million goats and 3.35million camels. However, these figures have to be treated with caution as there have been recent drought and disease outbreaks. Issues in resource availability Availability of quality hides and skins depends on improved breeds and good animal husbandry. Most Kenyan animals are small (local zebus) with the exception of the Boran breed and imported exotic cattle such as the Sahiwal and the European breeds. As discussed above, most animals are produced by agro-pastoralists and pastoralists in arid and semi-arid lands (ASALs) where they are grazed on free range. Due to inadequate pasture, water and health management, the level of husbandry is low. Inadequate extension services also contribute to the low level of husbandry. The livestock producers sell whole animals and consequently they do not attach any value to the hides/skins since they are not paid for it. For this reason, the producers do not attempt to improve the quality of the hides. Inadequate extension services also contribute to low quality of hides. Hides/skins are affected by faults and defects due to diseases and parasites on the living animals. Other mechanical defects are caused by branding, bruises and wounds especially during transport to terminal markets. About 40% of defects occur in the pre-slaughter stage.

5.3.2: Supply of Hides and Skins

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Regional Dimensions Table 5.8 provides averaged hides and skins production data for selected East African countries for the period2002 to 2003. The surrounding countries have considerable hides and skins. Although several countries have tanneries, a considerable quantity of hides and skins is imported into Kenya both formally and informally. In the past, imports were estimated at 20% over the number of hides/skins collected in Kenya.

Table 5.8: Hides and Skins production for selected EA Countries (Average 2002-09) Country Cattle hides Goat Skins Sheep Skins Burundi 2,197 1,230 263 Eritrea 3,600 696 527 Ethiopia 67,449 9,846 11,351 Kenya 50,306 12,633 6,843 Rwanda 3,758 1,003 281 Somalia 11,750 6,090 9,000 Sudan 58,191 30,374 23,230 Uganda 14,714 6,058 1,065 Tanzania 49,980 6,358 2,678 Total 255,990 72,055 54,694 Source: FAOSTAT 2014 Projected supply of Hides and Skins Projection of hide and skins production is normally based on off-take rates which are known to vary widely. For cattle, off take ranges from 9% to 15% p.a., for sheep from 12-36%, for goats from 15-33% and for camels from 10-12% p.a depending on production systems and demand for meat products. The officially recorded slaughter figures do not reflect the actual off-take rate as many animals are slaughtered at home and many others die naturally. For purposes of this study, supply projection has assumed off-take rates of 12% for all cattle (14% for indigenous cattle and 7.9% for dairy cattle), 36% for sheep, 33% for goats (15% for combined sheep and goats), and 12% for camels. Table 5.9 provides the projected livestock off-take in Kenya up to year 2020.

Table 5.9: Projected livestock off-take, 2010-2020 All Local Exotic Local and Sheep Goats Sheep and Camels Cattle exotic goats OR% 12 14 7.9 36 33 15 12 2010 2.16 2.041 0.274 2.315 5.29 9.79 7.008 0.36 2011 2.2 2.107 0.283 2.390 5.45 10.48 7.488 0.37 2012 2.31 2.178 0.292 2,37 5.61 11.21 7.904 0.38 2013 2.39 2.24 0.302 2.542 5.78 12 8,346 0.39 2014 2.466 2.324 0.311 2.635 5.96 12.84 8.812 0.394 2015 2.546 2.401 0.321 2.722 6.14 13.73 9.312 0.4 2016 2.639 2.479 0.332 2.811 6.32 14.7 9.84 0.41

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2017 2.718 2.562 0.358 2.92 6.51 15.72 10.305 0.42 2018 2.80 2.646 0.385 3.031 6.7 16.83 11.00 0.43 2019 2.90 2.733 0.417 3.15 6.9 18 11.64 0.434 2020 2.995 2.824 0.45 3.374 7.1 19.2 12.3 0.44 Source: This study At 12% off-take rate for cattle, annual production of hides and skins is estimated at 2.546milion in 2015. However, at 14% for indigenous cattle, the off take is 2.401 million while for exotic cattle at 7.9% is 0.3221million giving a combined off-take of 2.722 million and an average of the two at 2.634million. Using an off-take rate of 15% for sheep and goats gives an offtake of 9.312million. The camel offtake at 1% is 0.40 million. These offtake projections were compared to actual slaughter figures for 2009 to 2013 as summarized in Table 5.9 below. Table 5.9: Comparison of projected off-take with official slaughter (2009-2013) records

2009 2010 2011 2012 2013 Cattle Official 2057 1923.5 2103..4 2191.2 2147.3 Estimate (12% 2096 2160 2200 2310 2390 Local (14%) Exotic (7.9%) 2241 2315 2390 2470 2542 % O/E1 98 89 95.6 94.85 89.85 % O/E2 91.8 83 88 88.7 84.4 Implied OR% (Official) 11.8 10.7 11.3 11.4 10.8 Implied OR% for local/exotic 12.8 12.8 12.8 12.8 12.8 Shoats Official 5716 6163 5833 5924 6085 Estimate (sheep (36%) goats 13820 14580 15930 16820 17780 (33%) Estimate at 15% (sheep/goats) 6730 7098 7488 7904 8346 % O/E 41.4 42 36.7 35.2 34.6 %O/E (15%) 84.9 86.8 77.9 74.9 72;9 Implied OR% 12.7 13 11.7 11.2 10.93 Source: This Study In the case of cattle offtake, the figures indicate that the offtake rate is around 12% and the variance between official slaughters is minimal as the official slaughter is 84% to 98% of estimated offtake. In the case of sheep and goats, using 36% and 33% respectively would indicate that official slaughter is between 35% and 41% of estimates which would imply 60% of animals are not inspected. However, using an offtake rate of 15% for both gives an official slaughter to estimated offtake at 80% which is more realistic. Analysis of past data (2000-2006) on assembly of hides and skins shows a situation where the final world trend and local tanneries influence collection. The annual growth rates fluctuated widely but overall, the annual growth rate for cattle hides was

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3.6%, goat skins at 8%, sheep skins at 1% and camel hides at 61%. The figures projected from past collection are as shown in Table 5.10. Table 5.10: Projected collection of hides and skins (million pcs) 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Cattle 2.41 2.6 2.7 2.8 2.9 3.0 3.1 3.2 3.3 3.5 Goats 3.0 3.3 3.6 3.8 4.1 4.5 4.8 5.2 5.6 6.1 Sheep 2.46 2.49 2.5 2.55 2.57 2.6 2.62 2.64 2.67 2.7 Source: This study Figures are slightly higher than the estimates from off-take rates but the influence of policy and tax changes during the period needs to be taken into account.

5.3.3: The Tanning Sub-Sector

Regional Dimension In 2002, the total number of tanneries was estimated at 629 with 4 in Central Africa, 92 in , 407 in North Africa, 79 in Southern Africa and 47 in West Africa. Northern Africa dominates in tanneries due to their established leather industry while East and Southern Africa come second with 27% of tanneries. In the Eastern and Southern Africa region there were 140 tanneries but only 115 were operational (Table 5.11). South Africa, Ethiopia and Sudan have the highest number of tanneries followed by Kenya and Zimbabwe. Table 5.11: Regional distribution of Tanneries

Country Tanneries No. Operational Kenya 18 14 Uganda 5 4 Tanzania 6 2 Ethiopia 21 21 Sudan 23 19 S. Africa 32 32 Zimbabwe 15 11 Ghana 8 7 Eritrea 5 5 Botswana 1 1 Malawi 1 None Zambia 5 4 Totals 140 115

The figure shows that in countries with no clear policy on exports of raw hides and skins and imports of footwear and leather goods, the tannery sub-sector faced 62

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considerable pressure leading to closures. Installed capacity for hides varies from 90,000 pieces in Malawi to 3.3million pieces in Kenya. Installed capacity for skins is highest in Ethiopia standing at 32mi pieces. The region has considerable installed capacity but utilization capacity is low Utilization of capacity in tanning of hides ranges from 9% in Tanzania to 80% in Ethiopia averaging at 42%. Only Ethiopia, South Africa, Zimbabwe and Botswana operate at above the average. In the case of skins, utilization ranges from 9% to 60% and averages at 36%. In skins tanning, the good performers are Ethiopia, South Africa and Zimbabwe. Kenya was below average in both hides and skins tanning capacity utilization. Leather output from tanneries is either in the form of pickled, wet blue, crust and finished leather. Most of the countries only tan up to wet blue but others like Kenya, Sudan, Ethiopia and South Africa continue up the chain in value addition. Output data for selected countries are shown in Table 5.12. Table 5.12: Composition of Tannery Outputs in some selected countries Country/Type Leather output in percentages (%) Wet Blue Crust Finished Kenya – Hides 61 14 25 - Skins 65 22 13 Zambia – Hides 90 2 8 South Africa – Hides 30 8 62 Ethiopia – Sheep skins 40 22 20 Source: This Study It is noted that in South Africa with an advanced footwear and leather products industry, most of the leather is in finished form. Other countries only produce less than 25% in finished form. The situation may also be explained by the fact that many importers argue that the state of tanning is poor in Africa and insist on semi-processed leather for re-tanning and finishing. Current Situation in the Kenyan Tannery Sub-Sector Traditional vegetable-based tanning of hides and skins has been going on for centuries to produce items of clothing and footwear among others. Currently, this traditional tanning is only practiced among pastoral communities. Modern tanning has been developed in the last half of the last century. It grew up rapidly since independence and at its peak, there were 21 tanneries (5 involved in hides only, 6 in tanning of skins and 10 involved in tanning of both hides and skins). Their installed capacity was 3.5million pieces of hides/month and 11.6 million pieces of skins/month far in excess of national supply of raw hides and skins supply. The tanneries were distributed in all except Western and Coast Provinces. (Rift Valley 2, Central 4, Eastern 4, North Eastern 1, Nairobi 9 and Nyanza 1). It is noted that the tanneries were mostly in Nairobi and environs (Nairobi 42.9%, Thika (14.3% and Athi River 63

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9.5%) which accounted for almost 75% of tanneries mainly on account of commanding the major terminal market for livestock and slaughtering. Capacity utilization for operating tanneries where data was available ranged from 25% to 100% averaging at about 76.5% of installed capacity

Various factors contributed to the growth of tanneries prior to 1990. Firstly, there were no strict environmental controls in relation to pollution control and effluent treatment. Secondly, there was a 40% cess on the value of exports of raw hides and skins introduced in 1980 but abolished in 1986, as well as a surcharge of 2% on exports of raw hides and skins which gave incentives to increased processing. Thirdly, the tax regime on exports of leather was light with wet blue attracting 2% tax and crust and finished leather attracting 0.5% tax. Lastly, there was 20% export compensation on export of tanned leather but its abolition in 1990 caused the start of the collapse in the tanning sub-sector. In early 1990s, Kenya entered into a phase of liberalization and in the tannery sub-sector, this was mainly on the abolition of the 20% export compensation for exports of tanned leather and abolition of 40% cess on exports of raw hides and skins in 1986. This had a dramatic effect on operations of tanneries, employment and export of hides and skins. As discussed above, the number of tanneries has fluctuated as policy changes. Currently, there are 14 tanneries as shown in table 5.13 Table 5.13: Data on Tannery operations in Kenya Quantity of Goat and sheep Capacity Level of production wet salted skin (pieces per utilization Wet Crust Finished hides per month) (%) blue month Bata Shoe Limited Crust / N/A 100 X X X ( Town) Finished 600,000 sq. ft. Alpharama Ltd. (Athi 650 tons 400,000 100 X X X River) Leather Industries of 300 tons 100,000 50 X X X Kenya (Thika Aziz Tanneries Ltd. 300 tons 200,000 N/A X X X (Njiru Market) Sagana Tanneries Ltd. 200 tons 50,000 N/A X X X (Sagana Town) Tanneries 200 tons 150,000 N/A X Ltd. (Nakuru Town) Dogbones Ltd. 300 tons N/A N/A X (Nairobi) Nairobi Tanneries 50 tons 50,000 70 X X X 64

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Ltd. (Nairobi) East Africa Tanneries N/A 250,000 85 X Ltd. (Njiru Market) Faaso Import and 100 tons 50,000 N/A X Export (Nairobi) Athi River Tanneries 250 tons 100,000 N/A X (Athi River) MAS Trading 200 tons N/A 100 X Company (Nairobi) Zingo Tanneries 300 tons 200,000 80 X (Nairobi) Ondiri Tannery Insignificant Insignificant N/A X X X (Kikuyu) Adbulwadood Not in Not in N/A X Tanners Ltd. operation operation

Utilization of Hides and Skins All tanneries procure wet salted hides except Bata which acquires crust and finished leather from other tanneries. For the 11 tanneries, the monthly requirements for wet salted hides is 2,850 MT/month or 34,200MT/yr. At a weight of 15kg/wet salted hides, this would require 2.28million hides per year. For skins, the monthly requirement is 1.55 million pieces per month translating to 18.6million pieces per year. Capacity utilization ranges from 50% to 100% for six tanneries averaging at 81% which is higher than in the past when export of raw hides was allowed. Out of the 14 tanneries, 50% produce all three types of leather; wet blue, crust and finished; while 50% only produce wet blue leather.

Comparative Costs of Tanning Apart from hides and skins, tanneries use other inputs like chemicals (chrome, lime, sodium sulphide, Ammonium sulphide, salt, sulphuric acid, dyes and pigments) among others. In addition, there are costs of utilities, effluent treatment. Chemicals are second to hides and skins in cost and this is because some attract duty; chrome salt (15%), lime (15%), and lacquers (15%). A comparison of tanning costs between Kenya and Ethiopia is shown in Table 3.15 Table 3.14: Comparative Costs of Tanning Leather in Kenya and Ethiopia Kenya(Processing 1 kg Ethiopia (processing 1 sq. ft. of hide) of sheep skin)* Inputs Total Total Total Total cost (%) cost (%) (US$) (US$) Raw materials 1.16 72 0.42 59.0 Chemicals 0.32 19 0.08 11.0 65

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Labor 0.04 2 0.02 3.3 Electricity 0.03 2 0.03 1.5 Effluent treatment 0.04 3 0.01 0.9 Utilities N/A N/A 0.01 1.6 Depreciation N/A N/A 0.01 1.5 Marketing/ N/A N/A 0.03 4.3 Distribution Overhead 0.02 1 0.10 14 Total 1.60 100 0.72 100

Raw materials (raw hides and skins) represent the highest cost input in the tanning process for both countries. Yet, raw material costs are significantly higher in Kenya at 72 percent, vs. 59 percent in Ethiopia. The second most costly input is chemicals, which represent 19 percent of total costs in Kenya vs. only 11 percent in Ethiopia. Labor accounts for only 2 percent of total cost for Kenya, and is 3.3 percent in Ethiopia. The next most important cost is effluent treatment, which in Kenya accounts for 3 percent of total costs, and is three times higher than in Ethiopia

5.3.4: Capacity of the Leather sector to support additional tanneries

Although there is a considerable amount of hides and skins in the region, many countries have policies in favor of value addition to leather and as such, this may limit the amounts of hides and skins available. The proposed Leather Industrial Park proposes 36 tanneries (almost double existing tanneries). Although their capacities are not indicated, they would require considerable quantities of hides and skins. In the sections below (Table 3.15), the availability of hides and skins is calculated based on the following assumptions:

 All existing tanneries operate at 100% capacity utilization from 2016  Cattle offtake at 12% and 14% for indigenous and 7.9% for dairy  Sheep offtake at 36% and goats at 36%  Sheep and goats offtake at 15%

Table 3.16: Modeling potential availability of Hides and Skins in Kenya 2014 2015 2016 2017 2018 2019 2020 1 Existing Tanneries – Hides 2.28 2.58 2.58 2.58 2.58 2.58 2.58 - 18.6 19.07 19.1 19.1 19.1 19.1 19.1 Skins 2. Average cattle offtake 2.55 2.59 2.73 2.82 2.92 3.0 3.2 2a Surplus (+) 0.27 0.01 0.15 0.24 0.34 0.42 0.62 66

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2b Imports (15%) 0.38 0.39 0.41 0.42 0.44 0.45 0.48 2c Sub-Total 0.65 0.40 0.56 0.66 0.78 0.87 1.10 3 Offtake sheep and goats 18.8 19.9 21.0 22.2 23.5 24.9 26.3 a. Surplus (+) Deficit 0.2 0.8 2.0 3.1 4.4 3.8 7.3 (-) b. Imports 15% 2.8 3.0 3.2 3.3 3.5 3.7 3.9 c. Sub-Total 3.0 3.8 5.2 6.4 7.9 9.3 11.2

From the calculation above and based on the assumption that new tanneries in the park come in operation by 2018, the following observations are made: Cattle hides:

 The surplus hides from 2018 are 0.24million pieces to 0.62million pieces by 2020 which can support one tannery of a capacity of 7,800MT/year (520,000 pieces/yr).

 Alternatively, this can support 5-6 small tanneries at 80,000 hides per year  With 15% imports, this can be doubled to two large tanneries or alternatively ten small tanneries

Sheep and goat Skins: Most tanneries combine tanning of hides and skins

 For a skins-only tannery at 300,000 pieces/day, the surplus can only support two tanneries  For small tanneries or in association with hides at a capacity of 100,000 pieces per day, it can support five tanneries. Considering a tannery of Alpha Rama category, the surplus would support one combined hides and skins tannery. This may be preferable to avoid environmental costs at Kinanie.

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6. STAKEHOLDER ANALYSIS AND CONSULTATIONS

Consultation with stakeholders is one of the key elements of this SEA. Iterative consultations have been carried out during the SEA study in order to identify priority issues that require in-depth analysis during the SEA. Consultations also play a critical role in building environmental constituencies and exploring means of continuously improving beneficial environmental and social effects associated with the implementation of the Master Plan. This Chapter outlines the approach and outcome of the stakeholder analysis and consultations in respect of the Master Plan for the proposed Leather Industrial Park.

6.1 Legal Foundation for Stakeholder Consultation in Kenya

6.1.1 Provisions of the National Constitution Section 35 of the National Constitution 2010 provides for access to information as follows: 35. (1) Every citizen has the right of access to (a) information held by the State; and (b) information held by another person and required for the exercise or protection of any right or fundamental freedom. Further, Section 69 (1) (d) requires the State to encourage public participation in the management, protection and conservation of the environment, thereby giving legal foundation for stakeholder consultation in environmental assessment process. Stakeholder consultation as conducted for this SEA was partly in fulfilment to above stated legal obligations.

6.1.2 Requirements of EMCA 1999 Legal Notice 101 of June 2003 requires that all environmental assessment process in Kenya to incorporate public consultation. This is a requirement informed by the awareness that stakeholders are largely in the constituency likely to be impacted by proposed developments and it is imperative that they be informed of the project following which they can make informed comments and reactions to the proposed development. It is also important to ensure that all stakeholder concerns as well as aspirations are identified and incorporated in project development, implementation and operation. Against such background, a number of consultations have been undertaken with a cross section of stakeholders to the Master Plan for the proposed Leather Industrial Park. The main objectives of the consultations are:

i. To inform primary, secondary and other stakeholders of the proposed development; ii. To clarify stakeholder interests and concerns in the Master Plan area; iii. To better define scope and magnitude of potential impacts of implementing the Master Plan based on stakeholders‘ feedback. 6.2 Approach to Stakeholder Analysis

6.2.1 Criteria for Stakeholder Identification/Stratification Stakeholder identification in the SEA applied three core criteria as follows.

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(i) Fundamental Right Holders (FRH) for strategic resources in the Master Plan Area Under this category, different groups were identified, including:

Stakeholders to land: This category includes owners and occupants to land and land based resources in Kinanie. This includes those with residences, investors, farmers and other interests in the Kinanie area.

(ii) Legal Mandate Holders (LMH) within target jurisdiction Stakeholders identified under this category include those in National Government, County Government and State Corporations whose mandates confer jurisdiction over areas targeted by the Master Plan for the proposed Leather Industrial Park. From analysis of the legal framework as documented in Chapter Three, 15 Statutes are deemed to have over-bearing influence on the Master Plan for the proposed Leather Industrial Parks while simultaneously conferring specific mandates to respective institutions as shown in Table 6.1 below. In the view of this Study, these 19 institutions are the bona fide Legal Mandate Holders for the Master Plan area.

Table 6.1 Analysis of Legal Planning Mandates Covering the Master Plan area SN Legal Tool Custodian Legal mandate Relevance to Masterplan for Leather Industrial Park 1 The Physical State Coordinate all spatial Legal requirement for Planning Act Department of planning in the country each County to Cap 286 Physical develop a CIDP Planning 2 Schedule 4 of County Confers legal planning MCG has prioritised National Governments mandate to the County development targets Constitution, of Machakos Government of Machakos Public Finance Management Act 2012 3 Water Act WRMA Has prepared a National Need to harmonize 2002 Water Masterplan (NWMP) the Masterplan for 2030 to link water the LIP with the management to national National water aspirations for sustainable Masterplan economic development Has developed a sub- Need for the catchment management plan proposed LIP to be in for the Athi Basin harmony with management targets set in the Plan. Athi Water AWSB was established under The current supply to Service Board through the Gazette Notice the EPZA is tapped 69

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SN Legal Tool Custodian Legal mandate Relevance to Masterplan for Leather Industrial Park (AWSB) No.1775 of 21st March 2003 from the NAWSSCO, with a mandate for a WSP under the planning, developing, AWSB Jurisdiction. rehabilitating and expanding water and sanitation services AWSB prepared a infrastructure Water Master Plan 2012-2035 The TANATHI The is parastatal created Has Strategic Plan for Water Services through Gazette Notice water supply within Board No.69 of 4th June 2008 has jurisdiction a core mandate to coordinate water supply in 4 counties namely: Kajiado, Makueni, Kitui and Machakos. 4 TARDA Act TARDA Coordinate all development Has undertaken Cap 443 Planning in the Tana and spatial planning for Athi River basins the area under jurisdiction 5 State Leather Established through a Legal Has strategic plan for Corporations Development Notice No. 114 of 9th the Leather Sector Act Cap 446 Council of September 2011with Kenya-LDCK mandate to develop the Leather Sector in Kenya 6 State Export Gazette Notice 4342 of 19th Has Strategic Plan Corporations Promotion August 1992 established the targeting export Act Cap 446 Council Export Promotion Council promotion for purposes of promoting export oriented production. 7 Technology Kenya Was established in 1979 to Has a major research Act Cap.250 Industrial spearhead Industrial focus on Lather Research and Research in Kenya Technology Development Institute (KIRDI) 8 Roads Act KeRRA Planning for development of Rural 2007 rural roads in Kenya KeNHA Planning for development of Planning for National Highways development of Greater Eastern Bypass 9 EMCA 1999 NEMA Has national mandate for Need for proposed environmental regulation. Leather City to 70

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SN Legal Tool Custodian Legal mandate Relevance to Masterplan for Leather Industrial Park conform with environmental regulatory standards set by NEMA. 13 Companies All licensed Have made huge Need for such Act, Cap 486 players in the investments targeting leather investors to be Kenyan Leather produced in Kenya, the protected and value Chain same source being targeted accommodated in the by the LIP. proposed LIP. Mavoko Water A Water Service Provider Has developed & Sewerage authorised under the water Strategic Plan 2008 – Company Act 2002 2013 to guide water Limited supply in area of (MAVWASCO) jurisdiction 14 The Civil KCAA Under Section 56, the KCAA Under Detailed SEA, Aviation Act executes development the sensitivity of No. 21 of 2013 Control on areas considered Kinanie which is in a sensitive for aviation flight path will be purpose clarified with the KCAA 15 The Export Export to provide for the Under the SEA, the Processing processing promotion and facilitation proposed LIP must be Zones Act, Cap Zones of export oriented in accordance with 517 Authority EPZA investment and the the EPZ ACT. development of enabling environment for such investment and for connected purposes Source: SEA Study Team iii) Third party interests (TPI) This includes any interests outside categories (i) and (ii) such as non-classified access routes traversing the jurisdiction, wildlife migratory corridors in private lands, employees in enterprises based in the master plan area among others.

6.2.2 Levels in Stakeholder Consultations Consultations during the Detailed SEA stage built on consultations already undertaken in the Scoping stage. Proceedings of consultations at both Scoping and Detailed SEA stages is summarised in sections below.

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6.3 Outcome of the Stakeholder Analysis

6.3.1 Scoping Stage Consultations The purpose of consultation at Scoping Stage was three-fold:

 To establish linkage between the SEA Study and the target stakeholder  To profile stakeholders in terms of legal mandate and interest in the Master Plan area  To identify other relevant Stakeholders

Table 6.2 summarizes the core stakeholders identified and profiled at the Scoping Stage.

Table 6.2 List of Stakeholders Identified and Engaged at Scoping Stage. Category Identity Stake in LIP Vulnerability Fundamental Kenyan Citizens Constitutional Right to a Environmental Costs, Rights Holders Healthy Environment, Poverty Right to sustainable development Downstream Right to supply of Non sustainable water Communities adequate clean water supply Project proponent Right to land and Failure to achieve goals (EPZA) development mandate and targets Project Right to a clean healthy Environmental costs neighbourhood environment, Underperforming land Right to information prices Pre-existing Right to a level playing Marginalization out of business interests field business eg tanneries Legal Mandate County Has legal planning Conflict with planning Holders:- Government of mandate mandate GOK Agencies Machakos Failure to achieve targets with legal Political costs jurisdiction Political Right to information and Political costs over the area representation a voice and sector:- Local Right to information Failure to achieve targets Administration Road Agencies Planning and Failure to provide KeNHA, KURA& management mandate for required backup will KeRRA roads sector undermine achievement of economic goals and attract public backlash NEMA Regulatory mandate Adverse public perception which can affect future budgetary allocation

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WRMA Regulatory mandate on Failure to achieve targets water quantity and Adverse public perception quality AWSB, Mandated to supply Pressure on available MAVWASCO water water resource and infrastructure KFS, KWS Mandate to conserve Further decimation of fauna and flora biodiversity gene pools Research Research mandate Conflict over mandate Institutions;- KIRDI Other Business Opportunities for trade stakeholders prospectors Labour market Opportunities for employment CBOs/NGOs/FBOs New opportunities

Source: SEA Study Team

6.3.2 Progress in Stakeholder Consultations Upon stratification, all stakeholder categories were approached and arrangements for engagement were made. Consultations took any of the following methods:

 Direct engagements mainly through discussions held in offices of target institutions. Upon conclusion of discussions, the interviewee was invited to sign comments in a semi structured questionnaire.  Review of official documents inclusive of Acts of Parliament, Subsidiary Legislation, Strategic Plans, Master-plans, profiles etc either authored by or in respect of institutions with legal mandates.  Public Consultation meetings arranged for communities residents within respective jurisdictions: At this Scoping Stage, the target was to hold at least one central meeting in the affected Kinanie area following which, another meeting would be held at the detailed SEA stage. Minutes of proceedings in the meetings were prepared by the SEA Team and later on signed by the respective Assistant County Commissioner who chaired all the meetings.

A summary of stakeholder consultations during the scoping Stage is shown in Table 6.3 below. A total of 12 forums through which over 150 people were reached and sensitized during the Scoping Stage whose outcome was documented in the Scoping Report which was subsequently approved by NEMA.

Table 6.3 Breakdown of Stakeholder Consultations by Methodology Nature of Target Number Identity of those Details of Total consultation held met forum reached 73

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s One to one Mainly 5 KLDC Meetings 11 discussions LMHs KCCP were held in DCC Athi River offices of ACC Kinanie respective MP for Mavoko stakeholders Constituency Seminar Fundame 1 Kinanie Consultative 6 discussions ntal Right Development Forum Holders Association LMHs 4 EPZA Consultative 12 Management Forums Public Communi 2 Kinanie Public 126 Hearing ties/ FRHs Residents Hearing Meetings / meeting at barazas Kinanie Market Totals 12 155 events

Source: SEA Study Team

6.3.3 Stakeholder Concerns from the Scoping Stage Consultations A detailed analysis of concerns/ findings from the Scoping Stage was documented in the Scoping Report that was subsequently approved by NEMA. These issues have been studied in more details during the Detailed SEA Stage. The issues as approved by NEMA included:

i) Pre-existing concerns associated with presence of the sewage treatment plant ii) Potential to exert pressure on water quality and quantity iii) Potential to aggravate air, soil and water pollution iv) Potential to attract non planned development v) Potential to degrade property prices vi) Inadequate linkage between the Masterplan and the local economy vii) Potential to marginalize pre-existing investments in leather sector, viii) Potential to degrade the local labour resource 6.4 Consultations at Detailed SEA Stage

6.4.1 Scope and Focus of Detailed SEA Stage Consultations Consultations during the Detailed SEA Stage were issues- based focussing on investigation of concerns arising from the Scoping Stage and was carried out in conformity with NEMA‘s direction. Consultations also sought to partly contribute to addressing core issues identified at the Scoping Stage including: i) Comprehensive documentation of the receiving environment to better define; 74

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 Ecological potential and carrying capacity.  Livelihood systems and economically strategic resources,  Local production systems including value addition,  Ecologically sensitive resources,  Socio-economic profiles,  Issues pertaining to land availability for the Masterplan, ii) Comprehensive documentation of the Master Plan including interaction with prevailing baseline, current and planned infrastructure, iii) Comprehensive investigation of current status of soil, water and air pollution iv) Comprehensive analysis of water resource base in the area followed by modelling of future demand supply scenarios v) Inventory of all stakeholders by legal mandate, capacity and interests, vi) Participatory assessment of alternative models to the Masterplan, vii) Identification of measures to further in-build sustainability and flexibility into the selected model of Masterplan, viii) Consensus building on the selected model ix) Modalities for environmental and social management within the Masterplan x) Other considerations 6.4.2 Summary of Consultations during the Detailed SEA Stage In sections below, an account of the systematic consultation process adopted towards resolving issues as identified above is provided with Table 6.4 providing a summary and outcome of the consultation that took place towards resolving concerns. From Table 6.4, consultations SEA Stage Consultations entailed meeting as follows:

i) Key Informant Interviews: At SEA Stage, a total of 18 Key Informant Interviews were held mainly to clarify issues. ii) Consultative meetings: Three consultative meetings were held with diverse groups as follows:- iii) Public Baraza: Two public Baraza was held to disclose the SEA and attended by over 120 residents of Kinanie and members of Kinanie Resident Development Association. iv) Stakeholder Meeting: A stakeholder meeting was held for Machakos and Nairobi based Stakeholders on 26th October 2015 at the Technology Development Centre in Kitengela- Athi river and attracted a total of 66 participants.

Appendix 6.1 provides the outcome of stakeholder consultation with minutes and attendance lists as follows:-  Appendix 6.1: Outcome of Stakeholder Consultation.  Appendix 6.1a): Minutes and attendance List to the SEA Team Introductory meeting with EPZA  Appendix 6.1b): Minutes and attendance list of the Consultative Discussion by the SEA Team with EPZA

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 Appendix 6.1 c): Minutes of meeting held with the Kinanie Residents Development Association  Appendix 6.1 d): Minutes of meeting held with the Kinanie Residents  Appendix 6.1 e): List of Names for the meeting at the Water Resources Management Authority  Appendix 6.2: Proceedings of the Stakeholders Meeting

In sections below, an account of the systematic consultation process adopted towards resolving issues as identified above is provided. Table 6.4 provides a summary and outcome of the consultation that took place towards identification of the concerns.

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Photo 6.1 Pictorial Summary of Consultations during the Detailed SEA Study

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Table 6.4 (a) : Summary and outcome of the consultation with Fundamental Right Holders Category Stakeholder met Nature of meeting Emergent concerns Project Inception meetings with • Expectations Stakeholders in Government Proponent EPZA and specifically of the EPZA as employer (EPZA) in the SEA Study, • Contractual deliverables and timelines, • Possible facilitation by the client including access to documents, counterpart staff and availability of design maps for the routes of traverse, etc • Identification of and introduction of the Consultant to Stakeholders in the Leather Industrial Park Masterplan Project Consultative Discussion • Introduction of the SEA team to the Proponent See Appendix 6.1 (a) : EPZA. (EPZA) Minutes and Attendance • Field visit Meeting one list for the introductory meeting at EPZA. Project Consultative Discussion • To share interim observations accrued so Proponent See Appendix 6.1(b): far and chart way forward in the SEA (EPZA) Minutes and Attendance process list of the consultative • To obtain further insight into the design discussion by the SEA Team objectives and targets for the Kinanie and the EPZA. Leather Industrial Park Meeting three • Project Consultative Discussion • Pre-existing issues (Dust, foul smell, open Neighbourhood with Power point manholes) Proposed they be Presentation incorporated in the vetting of tanneries i) Kinanie (See Appendix 6.1 (c ): • Fear that the local economy will be Resident Minutes of the meeting negatively affected( mainly development Development held with the members of of slum) Association Kinanie Resident Development Association ii) Kinanie Public Baraza (See • Employment residents Appendix 6.1 (d ): Minutes • Assurance on incorporation of their of the meeting held with concerns the Kinanie residents • Proposed a Memorandum of Understanding between EPZA and the host community • Benefits to the host community i.e (Corporate Social Responsibility) • Modalities for community access to the LIP • What are the opportunities for local capacity development

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Stakeholder met Nature of meeting Emergent concerns Pre-existing Consultative Discussion • Preferred the SEA team to interview business interests every tannery separately and Zingo independently Investment ltd • Conduct independent assessment of the tanneries to determine what aspect of the tanneries would relocate and who is willing to relocate. • Will schedule a meeting for the SEA team

Alpharama Guided tour of the factory • Feels that the cost of effluent treatment is Tanneries including the effluent water very high. If a Central Effluent Treatment treatment plant Plant will be provided at Kinanie he would not mind relocating operations up to wet blue stage. Meeting with Kariakor • based leather trader Meting with • Kariakor-based leather cluster

Table 6.4(b): Summary of consultation with legal mandate holders Kenya Leather Inception meeting • Introduction of the SEA Study and Team to Development both institutions. Council of Kenya • To understand the stake and mandate of each (LDCK) institution to the Leather Sector in Kenya and more specifically, the proposed Leather Kenya Center for Inception meeting Industrial Park. Cleaner Production • Need to put in place an Integrated Production (KCCP). System as a strategy for effluent reduction at Kinanie County Government Consultative • Out of office. On a telephone conversation of Machakos Discussion she directed that the SEA team talk directly to County Secretary the County Executive Council Member for Trade, Water, Environment and Public health and CEC Infrastructure. Local Administration Consultative • Need to involve cross section of stakeholders i) Senior discussion and consider their input( host community, Assistant County investors, elected leaders, FBO etc) Commissioner –Athi • Address issues of benefit to the community River Sub county • Take care of all administrative boundaries iii) Assistant Consultative County Discussion Commissioner – Kinanie /Mathatani Division

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Political Consultative • Employment representation Discussion • Economic empowerment to the locals Member of (provision of irrigation water, domestic and Parliament-Mavoko market availability) Constituency • CSR on all areas including; education, health, roads and environmental protection. • Long-term relationship in all areas of development. Research Consultative • Product development research Institutions;- Kenya Discussion • Training and capacity building to LIP operated Industrial Research & footwear, Technology and machine operation Development • Developing new processes to keep up with Institute(KIRDI) technology change viz avis water use, energy, waste minimization, value addition of by- products. • Increase recovery • Consider Value addition on the waste eg making Fertilizer from waste or generating energy from waste • Environmental friendly tannery • Sources of new tanning materials to replace chromium • Construction of tanning equipment • No capacity for design for shoes manufacturer • Cluster has to be private sector driven/ GOK can only moderate • Sound out to stakeholders on the future role of LIP • What additional incentives would attract the investors? • Post tanning processing has some impact on leather finishing Recommendation KIRDI has a role to play in this by promoting research in design and quality improvement. The only way Kinanie LIP can make a difference in leather in Kenya is by unlocking the local demand for locally manufactured shoes. WRMA Consultative • Raised concern that the EIA process has been (i) Regional discussion abused an used to approve disastrous projects Manager-Athi • Proposed to the consutant to make a return Catchment visit to hold a consutative discussion with all thematic eperts in the region (ii) WRMA Technical Consultative • Pre existing challenges Team Discussion with i Sewer line which has open manholes staff with power • Pollution in Athi River: Impact on strategic point resources which will have an effect on Water

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presentation(See quality and quantity. Athi river is main source Appendix 6.1 (e) : of household water supply at Wamunyu List of Attendants downstream of Machakos. All of athi is to the WRMA polluted down up to . Limuru-Thika- meeting Nairobi all feed into Athi.LIP will compound existing pollution. What measures of control are envisaged? • Mbagathi is already much polluted and the area gets flooded/submerged during floods. This will lead to discharge into Mbagathi river. There are fears that LIP will introduce new pollution • Local interests i.e the land and property prices will be affected, Quality of livelihoods and fear of non planned development eg development of slums • Degradation of environmental quality: New pollution will be introduced ie air pollution, water pollution and the solid waste menace due to an increase in population. • Ground water quality and quantity will be affected • What will happen to pre existing investors • The master plan should be in harmony with existing strategic plan • Strategically, such developments would require water investigation being undertaken in Ngong and Munyu rivers. • Athi catchment has excess floods in rainy seasons hence this water can be harnessed. • MAVWASCO has inadequate supply. What are their targeted source of water? • None of the tanneries in Athi river area is compliant. Very high chromium levels in effluent. What method will be applied to recover chromium? • Both WRMA and NEMA require that discharge standards must be met by proponent. • Proposed development of slaughter houses at county level means that expanded supply of skins and hides may not be available Opportunities for strategic Impact • Rationalize master plan to resource availability • Peg tanneries to availability of hides and skin • Cut water demand for pollution load

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• Divert export of wet blue to master plan to boost value addition parks and optimize on exports • Strategic interventions • Self regulation through Eco labelling • Water supply options Mavoko Water & Consultative • Sources of water in Athi river Sub County Sewerage Company Discussion i) NAWASCO -30-35% Ltd ii) Intake from Athi river 25% iii) Nolturesh-0% • Meeting only 60% water demand • Main demand areas i) Domestic supply ii) new estates • Industries around rely on boreholes • Kenya Meat Commission dam on the Stony Athi • There is a Proposed dam in Portland at new valley river(Isinya river upstream of confluence with Stony Athi • Expansion of the Athi intake dam through desilting and elevation of embankment by 1m. Machakos County Consultative • Machakos County Government is not Government Discussion involved in planning for the master plan both (i) Sub County at County and Sub County levels. Engineer- • There is need for the EPZA to engage with Mavoko the County Government • Physical Planner has to review any plans then involve all offices including the Engineer , Surveyor, Physical Planner, each office has to approve at preliminary level. • Project stakeholders should be involved and issued with a circular letter up to the County level. • Need to work up master plan to other pillars of the vision (ii) Sub County Consultative • Confirmed that a county Intergrated Planning discussion Development Plan (CIDP) for Machakos Officer County exists and he promised to avail a copy of the same to SEA team. • Indicated they had undertaken a water mapping study for Mavoko and promised to avail it to the SEA team.

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Ministry of Consultative • There should be a law limiting the number Agriculture Livestock discussion /amount of raw hides exported. and Fisheries. • The tanneries should process until the final Director of livestock stage. production • The industries should be able to control (i)xxxxxxxxx pollution in the tanneries. • The value chain should liase with the veterinary department in respect to the quality of hides and skins produced. Ministry of Brief highlight • Provided the telephone contacts of an expert Agriculture Livestock (Norah Kandie) who is the Head of Hides, and Fisheries skins and leather for further discussions. Assistant Director of Veterinary Services (iii) xxxxxxx

Business prospectors No group has been met so far.

Source: SEA Study Team

6.5 Key Issues Emerging from Detailed SEA Stage Consultations

Based on consultations with all categories of stakeholders, there is overwhelming support for the proposed LIP whose economic potential is apparently well understood. The challenge is to mitigate all concerns so as to improve on the net worth and acceptability of the initiative. From the SEA Stage stakeholders consulted raised issues as follows:-

i) Pre-existing concerns associated with presence of the sewage treatment plant ii) Potential to exert pressure on water quality and quantity: The MP for LIP will escalate the pressure on surface and groundwater and thus escalate an already severe problem. iii) Potential to aggravate air, soil and water pollution iv) Potential to attract non planned development v) Potential to degrade property prices vi) Inadequate linkage between the Masterplan and the local economy vii) Potential to marginalize pre-existing investments in leather sector, viii) Potential to degrade the local labour resource

Pre-existing concerns associated with presence of the sewage treatment plant: There is fear that introduction of the LIP will be another menace into the area since the already existing sewerage ponds are a nuisance to the community and discussions have been held between EPZA and host community and no action has been taken.

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Potential to exert pressure on water quality and quantity: The MP for LIP will escalate the pressure on surface and groundwater and thus escalate an already severe problem.

Potential to aggravate air, soil and water pollution: There is fear of degradation of the quality of environment such as air pollution, water pollution (both surface and groundwater) and increase in solid waste. Both the WRMA and MAVWASCO confirmed that water supply would be inadequate to meet needs anticipated in the Master Plan for the LIP. There is therefore need for additional water supplies to be explored.

Potential to attract non planned development: The request is for the Master Plan process to involve the County with the planning process so that the county government can better prepare for such emerging needs while at the same time maximize the benefits accrued from the LIP development. This will ensure that the master plan is in harmony with existing strategic planning.

Potential to degrade property prices: The master plan has potential to occasion cumulative and irreversible impacts associated with the magnetic effect of urbanization in an ASAL area leading to escalating pressure on land, water and climatic resources.

Inadequate linkage between the Masterplan and the local economy: The master plan has potential to conflict with national and regional planning mandate in the area of water resource management. Consultations with the stakeholders is therefore necessary to ensure that the masterplan is not in conflict with the existing strategic planning.

Potential to marginalize pre-existing investments in leather sector, Potential to degrade the local labour resource: The LIP could push existing leather sector players out of business and in the process occasion job cuts and economic hardship to current employees.

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7: ANALYSIS OF ALTERNATIVES 7.1: Approach to Analysis of Alternatives

Analysis of alternatives sought to explore other options in achieving the Vision 20230 Strategy of (i) Attracting Foreign Direct Investment, (ii) Manufacturing for Export, and (iii) Employment creation towards achieving the Vision of a globally competitive Kenya with high quality of life with least social and environmental costs. For Plan Level initiatives such as the Master Plan for the Leather Industrial Park, selection of alternatives is limited to three options (Table 7.1) namely:- ◦ Development Scenarios ◦ Strategic Alternatives ◦ Land Use Alternatives/ Combinations

Table 7.1: Criteria in analysis of alternative for different PPPs Alternative Level of PPP under consideration scenarios Policy Plan Programme Project Comprehensive Development Programme Location, route development Scenarios alternatives alternatives Scenarios Strategic Priority Technical Comprehensive Alternatives alternatives application Strategic Land Use alternatives n Alternatives Alternatives Implementation alternatives Scenario One Scenario Two Source: Tis Study

7.2: Selection of alternatives

7.2.1: Selection Criteria Based on three parameters as identified in 7.1 above, threen alternative options have been identified largely based on views expressed by diverse stakeholders as presented in Table 7.2.

Table 7.2: Analysis of alternatives in delivering on the LIP Vision Option Proposed Intervention Package Nature of Proponent level Alternative 1 The No Go Option: Retain Tanneries Strategic Status Quo in current location but semi-process to Alternative Wet blue for export and local market 2 The LIP Model: Establish the Leather Strategic LIP Model City and attract Tanneries processing Alternative leather to final products 3 Improved LIP Model: Transport Wet Strategic Kinanie

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blue/Crust/ Finished Leather to Alternative/ Land- residents Kinanie for Value addition to final use products

Selection of alternatives: With the exception of a few, all development models analysed here in were informed by Stakeholder views but also reflect diverse routes in allocating the national leather resource base as captured by the KLDC (Fig 7.1).

Source: KLDC Strategic Plan Fig 7.1: Analysis of past trends in export of leather grades

Option One: The Status Quo Option Pursuit of the Zero Option means that there will be no intervention at Kinanie. The current status quo whereby tanneries retain in current locations largely processing to Wet Blue Leather for both export and local market will be retained.

Option Two: This is the LIP Model as proposed. It assumes full tannery operations at Kinanie with full complement of the Value Addition parks as proposed.

Option Three: This is a variation of the LIP Model. It favours retention of Tanneries in current location to produce Wet Blue Grade and other grades leather all of which will be transported to Kinanie for value addition to leather products under the LIP Model.

7.2.2: Analysis and ranking of the Alternatives

The ranking criteria Comparison of alternatives was based on diverse criteria targeting capacity of the option to deliver on aspirations of the GoK in conceiving the LIP namely:-  Job creation  Creation of new trade opportunities 86

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 Foreign Direct Investment  Foreign Exchange Earnings  Multiplier effect  Budgetary pressure  Environmental costs  Pressure on water  Carbon foot print  Pressure on Energy

Depending on observed strength each criteria attracted a weight ranging from -5 (significant adverse impact) through to 5 (major positive impact). The weighted scores were then tallied to provide the net ranking of alternatives depending on the total score.

Trend analysis Performance of each alternative as well as the LIP Model (described in chapter 2) against each criterion inclusive of total tally of scores is provided in Table 7.3 below. From this analysis, trends emerge as follows:-

Table 7.3 (a): Analysis of options against set criteria Option I-The No Project Option: Tanneries remain in current locations processing Wet Blue Grade Leather for export and local market The Criteria Scoring at different activity levels Kinanie County National Net Job creation 0 -1 -1 New trade opportunities 0 0 0 Foreign Direct Investment 0 0 0 Foreign Exchange Earnings 0 1 1 Technology transfer 0 0 0 Environmental costs 0 -2 -2 Pressure on water 0 -2 -1 Carbon foot print 0 -1 -1 Energy footprint 0 -1 -1 Grand Total 0 -6 -5 -11

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Table 7.3(b): Analysis of options against set criteria

Option II: Attract Tanneries to Kananie and process hides and skins to final products under LIP Model The Criteria Scoring at different activity levels Kinanie County National Net Job creation 5 0 0 FDI 5 0 0 Foreign Exchange Earnings 3 1 5 Technology transfer 5 2 2 Increase in social amenities 5 1 0 Market for local produce 4 0 0 Pressure on water -5 0 0 Pressure on national budget 0 0 -2 Pollution load -5 0 -2 Carbon footprint -3 -2 -1 Energy footprint -3 -1 -1 Grand Total 11 1 1 13

Table 7.3 ( c): Analysis of options against set criteria Option III: Transport Wet Blue/Crust/Finished Grade Leather to Kinanie for Value Addition to final products The Criteria Scoring at different activity levels Kinanie County National Net Job creation 4 4 2 FDI 3 0 2 Foreign Exchange earning 3 2 3 New trade opportunities 5 2 2 Technology transfer 5 1 1 Social welfare 5 1 0 Market for local produce 3 0 0 Pollution load -2 1 1 Pressure on water -2 0 0 Carbon footprint -2 -1 -3 Solid waste -2 -1 -1 Energy footprint -2 -1 -2 Grand Total 18 8 5 31 Source: This Study

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Economic Impact at Kinanie: From table 7.3, it emerges that the highest volume of benefits will accrues at Kinanie level on account of injection of FDI which will create jobs, new trade opportunities, social amenities, market for local produce etc more so for options involving relocation of tannery operations. Thus Kinanie will be the main beneficiary.

County Level Impacts: County Governments would be the ultimate losers in any relocation on account of job cuts and loss of income and any gains to Machakos will amount to losses to other counties. Only Option Two promises substantial benefits to Counties.

National level Impacts: National level impacts mainly manifest through Foreign Exchange Earnings where full value addition is adopted. The same gains are however eroded by costs such as environmental costs, carbon foot print, pollution load etc accruing to the government. Only Option Two promises a favourable benefit regime to the national Government.

Cost Drivers in the LIP: The most costly aspects in operationalizing diverse options are in order of severity:- Pollution Loading, Costs on water, Carbon Foot Print, Energy footprint among others.

The recommended Option Table 7.4 provides a ranking for all options based on a tally of the total scores. Quite clearly, Options 1 and 2 which hinge on maintenance of the current scenario are not viable as they sustain negative growth at the three action level implying that assets currently owned risk erosion with people sinking deeper into poverty. Likewise Option Three, entailing relocation of tanneries without backup by aggressive value addition will be costly at both Kinanie and County levels on account of environmental costs.

On the contrary, both options 5 and 4 in that order have merit and require further investigation. Indeed, an intervention whereby tanneries are retained at current location producing Wet Blue Grade Leather for export to Kinanie seems to be the most promising option as it has least net environmental costs while securing the highest net returns. Further, the fact that this model allows for equitable distribution of benefit streams at the three levels (Kinanie, County and National Government) thus providing for a win-win situation resonating quite well with the Social Pillar of Vision 2030. The model would also be easier to rationalize against the observed scenario in raw material supply.

A schematic presentation of the Kinanie Model is provided in Fig 7.2 below. Essentially, Kinanie becomes a value addition center for leather previously semi- processed in the currently existing tanneries.

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Table 7.4: Ranking of Alternatives based on tally of scores Option Intervention Score Rank 1 The No Project Option: Tanneries -11 3 maintain Status Quo operations 2 Attract Tanneries to Kinanie with full 13 2 value addition under the LIP Model 3 Locally Import Wet Blue/Crust/Final 31 1 Grade Leather to Kinanie for full Value Addition (Improved LIP)

Export market

Product line 2 Product line 1

Domestic Distributors Market Distributors

Wet Blue transported to Kinanie for processing to Tanneries process Tanneries process finished leather to Wet Blue at to Wet Blue at County Level County level

Source: This Study Fig 7.2: The Kinanie Model

7.2.3: The hidden costs Models 5 through to 7 as analysed above only reflect net environmental costs emanating from transport and additional processing of leather products to finished products but fail to capture environmental costs at source. Estimates have it that recovery from the Tanning process is only 20%, the rest being discarded as waste while 50 cubic metres of water are required for every tonne so processed. These in addition to liquid effluent heavily loaded in BOD, Total Dissolved solids (salts) and COD are the environmental costs accruing from raw material treatment and which 90

EPZA: Strategic Environmental Assessment for the Master Plan for the Leather Industrial Park will not reflect in the Kinanie Model but which are drastically killing the environment at source. NEMA should enforce strict monitoring regimes to clamp down on the polluters.

7.2.4: Assumptions in the analysis Analysis and ranking of alternatives as unveiled above have one basic underlying assumption namely that there exists a local market for Wet Blue Grade Leather. However, quality issues and local attitude towards locally produced leather goods, more so shoes, pose the greatest constraint to market penetration by the Wet Blue, Crust and Finished Grade Leather and to achievement of overall goals of the Masterplan (Box 7.1). Kenya has remained a semi-processing country with negligible production of finished leather, not enough even to satisfy its local demand for the footwear industry (Mwinyihija & Killham, 2006). This is an important observation because it presents an opportunity to be explored towards further growth in the sector. The causes of this shortfall are worthy of pursuance despite the potential highlighted.

This presents an opportunity for intervention.

7.2.5: The potential to be harnessed Table 5, shows value addition in processing of leather. When tanning to Web Blue grade, there is 80 percent value addition, to crust is 200 percent, to fished leather is 400 percent value addition, while finishing to leather shoes value addition is 850 percent. In conclusion, there is more gains in processing leather to the final products than selling them in raw form.

Table 7.5: Value Addition Stage in value addition Relative gain (%) Low animal off-take rates of 12, 36 Depends on elasticity of and 33 % for cattle sheep and goats the meat market compared to global average of 20%, 43% and 43.8% About 25% of Hides and Skins 25% addition in local currently smuggled out supply of Hides and skins Tanning to Wet Blue Grade 80 Tanning to Crust Grade 200 Tanning to finished leather 400 Finishing to leather shoes 850

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Box 7.1: The ailing domestic market for local leather (KLDC Strategic Plan)

According to the KLDC Strategic Plan, the tanning sub-sector in Kenya was established primarily with the main aim of being export oriented, since Kenya cannot consume all the leather produced locally. However for the industry to succeed in the export market, it must be competitive in the local market. This has not been the case since the local footwear and leather goods manufactures have been unable to withstand competition from subsidized imports. The stakeholders feel that macro-economic factors have created uneven playing field and trend to favour exporters of raw hides and skins as well as importers of finished products over investors in manufacturing plants. This is against the spirit of Sessional Paper No. 2 of 1997 on industrialization to the year 2020. Irrespective of the effort by the government to ensure that Importers of both new and second hand shoes pay for the prescribed import duties, prices on imported shoes are still lower than those manufactured locally. For example countries like India and Pakistan provide subsidy of up to 15% to their exporters enabling them to penetrate markets like Kenya. Local manufacturers are struggling to survive under the prevailing circumstances while at the same time the number of shoes worn per capita is modest at about 0.5 pairs per person per year does not increase finished leather requirements due toPer massive capita shoes imports worn nowof second stands at hand 0.93 and new shoes. To a large extent the enabling environment created and prevailing in a country determines the pace of Leather Sector Development like in all other segments of the economy.

7.2.5: A Leather City with a difference Were Kinanie, to adopt the current leather, production model, the sector has no future and would probably be a missed opportunity. However, the LIP offers a great opportunity and promise. This promise can only be realised if Kananie takes time to study, clearly understand and unlock all constraints to market penetration by locally produced shoes. This is where the role of Research and Development comes in to address quality and design issues in locally produced shoes. In the absence of this, the current scenario whereby Kenyan leather accounts for only 7.9% of the 42 million national shoe trade (Table 7.5) will persist. This is the Challenge to EPZA and co- collaborators in the LIP.

Table 7.5: Dynamics of the Kenyan shoe industry Type of Total Pairs Non- Imported Kenyan Footwear Sold (106 Leather leather (106 leather pairs) (106 pairs) pairs) (106 pairs) Second hand 26.5 18 8.5 0 shoes (mitumba) New – low price 12.9 8.1 2.2 2.6 New – mid price 2.2 0.6 0.9 0.7 New – high 0 0 0.2 0 price Totals 41.8 26.7 11.8 3.3 Percentages 100 63.9 28.2 7.9

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8: ANALYSIS OF POTENTIAL CONFLICTS WITH PRE-EXISTING INTERESTS 8.1: Collation of Potential Impacts

Chapters 4 through to 7 above have documented the environmental and socially sensitive baseline preceding development and implementation of the Master Plan for the Leather Industrial Park. As well, an attempt has been made to document potential impacts likely to be felt from development and implementation of the Master Plan based on:- (i) Documentation of baseline conditions including sensitive resources, (ii) Application of policy/ legal instruments, (iii) Collation of stakeholder concerns and, (iv) Collation of on-the-ground observations through application checklists. In this Chapter, observed impacts will be applied to scope the proposed Master Plan on the basis of:-

 Potential conflict/harmony with other sectoral planning  Potential impact on strategic resources  Potential to generate cumulative and irreversible impacts

Analysis of impacts has relied heavily on use of matrices. 8.2: Analysis for conflict/harmony with other pre-Master Plan interests

In this section, the Master Plan is screened for harmony with pre-existing stakeholder interests namely:-  Interests of Fundamental Right Holders  Interests of Legal Mandate Holders  Third Party Interests

8.2.1: Harmony with Interests of Fundamental Right Holders

Chapter Six had identified five FRH categories namely Kenyan, citizenry, local neighbourhood, downstream communities, pre-existing investors and those with right to land and development mandate. Table 8.1 provides an analysis of the potential interplaying of the Master Plan with such rights.

Table 8.1: Analysis for harmony with pre-existing fundamental rights Category Identity Stake in Potential impact of Status Masterplan for Masterplan activities LIP Fundamental Kenyan Citizens Constitutional Could introduce Conflict Rights Holders Right to a environmental Healthy degradation Environment Right to Will promote Harmony sustainable economic growth development and contribute to

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social welfare of Kenyans Downstream Right to supply Will exert pressure Conflict Communities of adequate on quality and clean water quantity of water resources Project Right to land and development Harmony proponent mandate (EPZA) Project Right to a clean Could degrade Conflict neighborhood healthy environment and environment quality of life in neighborhood Right to Could create new Harmony economic jobs, trade transformation opportunities and market for local resources Pre-existing Right to a level Could induce Conflict business playing field business interests eg marginalization tanneries Could create new Harmony business opportunities

From above analysis, the Master Plan can either resonate or antagonize Fundamental Rights depending on the calibre and focussing of proposed interventions. The challenge is to package an investment protocol that will minimize on environmental and social costs while optimising on local participation to maximise on benefits. Chapter Eight below has explored the potential for full mitigation through integration of current interests through the concept of Integrated Master Plan.

8.2.2: Harmony with Interests of Legal Mandate Holders

Screening of the Master Plan for harmony with legal mandates has recognised two tiers namely:- National LMHs and County/ Machakos level LMHs. Screening outcome is provided in Table 8.2 and 8.3.

8.2.1: Harmony with national-scale plans As conceived, the Master Plan for LIP is likely to cross the paths of 10 on-going national strategic plans (Table 8.2) all of which touch on Kinanie. From analysis, the Master Plan is in harmony with 4 pre-existing Plans namely;- Vision 2030, MTEP 2012-2018, EPZA Strategic Plan and the national Poverty Eradication Plan (199-2015) but could be in conflict with the remaining 6 as briefly outlined below:-

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The National Environmental Action Plan (NEAP) 2009-2013: The NEAP is normally a 4 year plan promote integration of priority environmental protection targets into operations of GOK sectors mainly inclusion in performance contracting. Such environmental targets are often identified from issues emerging from the State of the Environment reports. Under the current NEAP, NEMA is implementing the ICZM Action Plan targeting three Strategic Objectives. Thematic area Two seeks to promote wise use of resources through strategic objectives that promote empowerment of the communities to embrace sustainable livelihoods and develop and implement resource use conflict resolution mechanisms as follows:- Strategic Objective 1: Promotion of community empowerment and sustainable livelihoods. Strategic Objective 2: Resolving resource use conflicts and benefits sharing

As conceived, the Master Plan does not incorporate measures for community empowerment but will limit community access to land and the shoreline and possibly escalate conflict. This issue requires resolution through development and implementation of a Resettlement Action Plan-RAP.

The National Water Master Plan 2030: The recently concluded National Water Master Plan projects a daily urban water demand of 2.25 million cubic metres for the Athi Basin owing to the presence of the two cities of Nairobi and Mombasa (JICA/ Nippon Koei, 2012). In the projection of the NWMP, annual water demand in this Catchment will amount to 116% of supply reflecting a scarcity situation by 2030. This scarcity could be aggravated by superimposition of an additional daily demand of 31,500 cubic metres as anticipated at the full term of the Master Plan.

Table 8.2: Potential impact of Master Plan on national planning objectives

SN Planning tool Planning objectives Master Plan objectives Status /impacts 1 Vision 2030 Establish Industrial Parks at Develop the LIP at Harmony County level Kinanie 2 2nd MTEP Development of SME Develop the LIP at Harmony (2012-2018) parks and industrial parks Kinanie in each of the 47 counties in order to attract new companies, the expansion employment and attraction of FDI 3 National Reducing poverty by half Develop LIP attract Harmony Poverty by 2015 in line with the FDI, create jobs and Eradication Millennium Development generate revenue to Plan 1999-2015 Goals (MDGs) address MGS including poverty Poverty Reduction

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SN Planning tool Planning objectives Master Plan objectives Status /impacts Strategy Paper 4 MOIED Promoting Invest in the LIP to Harmony National industrialization for Job create jobs and re- Industrialization creation and economic energize Strategy growth manufacturing based GDP growth 5 Ministry of Transformation of the Invest in a state of the Harmony Industrialization leather industry through:- earth LIP to underpin and Enterprise capacity building for Leather Sector in Development leather institutions, Kenya. Draft Strategic establishment of mini Plan (2013 – tanneries and completion 2017) of the existing ones in ASAL, Carry out a Baseline Survey on the meat and leather value chain industry in Kenya. development of regional Meat and Leather

of master plans for meat and leather clusters 46 Export To increase employment Develop a LIP to Harmony Processing in the EPZs to 156,000 by attract FDI, create Zones 2019; To increase EPZ jobs, manufacture for Authority contribution to GDP to export etc Strategic Plan 3% by 2019, To diversify the markets, EPZ enterprises targeted, attracted and sustained. 7 Masterplan for Harmony Sustainable Industrial Development in Kenya MAPSKID)- 2008 8 Leather Market development The LIP targets Harmony Development through;- product creation of a state of Council development to access the the art leather city Strategic Plan global market, with an eye on the improvement of business global market environment and adoption of tailor made business programmes 96

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SN Planning tool Planning objectives Master Plan objectives Status /impacts 9 KIRDI Strategic To undertake and Establish capacity for Harmony Plan improve research in Leather Industrial Research and value chain among Development through others capacity building for value addition to raw and semi- processed materials, among others. 10 National Proposes to LIP will align to NEAP Harmony Environmental of cleaner production requirements through Action Plan systems, enforce and use of EIA, (2009-2013) implement standardized Environmental Audit technologies, implement and others regulations o toxic and hazardous chemicals, noise pollution, enorce EMCA, 1999, relevant legislations and policies, enforce Physical Planning Act 1997 11 National Water Reduce water deficit in LIP will escalate water Potential Master Plan Athi Basin and South demand in Athi for 2030 Coast projected (year catchment conflict 2030) at 116% of water over demand (supply of 1664 water MCM against demand of demand 1929MCM) 12 Nairobi Urban Alongside the To create a new center Harmony Integrated MetroGrowth Strategy for growth at Kinanie Development 2013, NUITPLAN aims at hence attract Masterplan decongesting Nairobi population away from through promotion of Nairobi City expanded growth in the satellite towns

Screened against 12 pre-existing mandates, the LIP is in perfect harmony with 11 but could conflict with the national water Masterplan though excerpting unplanned for pressure on the quality and quantity of water resources.

8.2.3: Harmony with Regional Planning Objectives The Urban Areas and Cities Act 2011 requires all counties to develop County Integrated Development Plans on which all other development planning will be anchored. Cross-checked against this and other planning objectives planning mandates for the Machakos County (Table 8.3), the Master Plan apparently harmonises well 97

EPZA: Strategic Environmental Assessment for the Master Plan for the Leather Industrial Park with the CIDP but is in conflict with targets and planning objectives of the Water Oversight bodies on account exerting undue pressure on their capacities. Water, therefore remains an outstanding issue in the entire Masterplan.

Table 8.3: Potential Impact of Master Plan on Coast Region planning objectives SN Planning tool n Planning objectives for LIP Status Kinanie objectives/impacts 1 County Proposes to create Industrial Proposes to create Harmony Integrated Parks Industrial Parks Development Plan (CIDP) for Identifies the Athi River belt Identifies the Athi Harmony Machakos as the manufacturing Zone in River belt as the County the County manufacturing Zone CIDP requires adherence by LIP will be aligned Harmony all other planning initiatives to requirements of CIDP as allowed for in Cap 246 2 TARDA Strategic Area of jurisdiction covers Creation of an Harmony Plan Machakos County Industrial Park 3 WRMA Optimal management of LIP will put strain on Conflict Catchment water quality and quantity water quality and Management given the water scarcity availability Strategy for Athi status and increasing Catchment pollution load from Nairobi, Thika, Machakos, Kitui, Athi River and others. 4 TANATHI Partner with MAVWASCO Masterplan will Conflict Strategic Plan under a PPP arrangement to strain water supply if supply additional water to tapping bridge current shortfall in MAVWASCO supply supply 5 MAVWASCO Increase delivery of potable Masterplan will Conflict Strategic Plan water from 20% to 60%; strain water supply if and sewerage services from tapping 15% to 40% hence MAVWASCO supply improving basic sanitation of the residents of Mavoko and Kitengela, to increase and guarantee availability of water from the current 20% to 60% in order to attract investors all the year round by 2013. Source: SEA Study Team

8.2.4: Summary of potential areas of conflict with other sectoral mandates 98

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From analysis above, it emerges that the Masterplan for LIP resonates quite well with other planning mandates at both the national and County Government level. The exception however is the water sector mandates where the LIP could be in conflict associated with its potential to exert pressure on quality and quantity of water resources and in the process straining the capacity of relevant institutions. The options here is for the LIP to identify own viable sources of water supply and invest in a Common Effluent Treatment Plant for Kinanie as proposed. 8.3: Screening of Master Plan for potential Impact on Strategic Resources

Within the Master Plan area, resources considered important to supporting sustainable livelihoods and economic growth include:- Range resources, Biodiversity, Water resources, Energy and Labour force. Implementation of the Masterplan will adversely impact on water and habitat for biodiversity.

Table 8.4: Potential Impact of the Master Plan on Strategic Resources No Strategic Potential adverse impact Potentially cumulative Resource impact 1 Nature Implementation of the Reduction in Habitat Conservation Masterplan will escalate pressure required to maintain viable areas on land and possibly further populations of biodiversity decimate remnant habitats for biodiversity. 2 Water Implementation of the Master Implementation of the resources Plan will excerpt pressure on Masterplan for LIP will quality and quantity of water increase pressure on limited resources in an already water water resource, exert scarce region. pressure on already overexploited aquifers and increase pollution loading on the already much polluted Athi River Source: SEA Study Team 8.4: Overall Picture of the Strategic Impact of the Master Plan

From analysis undertaken in this Chapter, it emerges that implementation of the master plan has potential to occasion an array of impacts as follows:-

i) Conflict with other legal planning mandates: The master plan has potential to conflict with delivery of service and achievement of targets in the water Sector. ii) Impact on locally strategic resources: The master plan has potential to adversely the quality and quantity of both surface and groundwater resources of the Athi Basin. iii) Tendency to occasion cumulative and irreversible impacts: The master plan has potential to further exert pressure on the quality and availability of surface and groundwater and surface water resources in the Athi Basin which are already under extreme exploitation re. 99

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Analysis of alternatives as outlined in sections below will attempt to identify an investment model that combines best returns with least environmental and social cost based on the three criteria summarised above.

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9: IMPACT PREDICTION 9.1: Approach to Impact Prediction 9.1.1: Background to Impact Prediction During the Scoping study, several strategic resources in the Master Plan area were identified as presented in Table 10.1. Within the Master Plan area, resources considered important to supporting sustainable livelihoods and economic growth include: agricultural land, range resources, nature conservation areas, water resources, energy and labor force.

Table 9.1 Potential Impact of the Master Plan on Strategic Resources No Strategic Resource Potential Impact of the Master Plan 1 Agricultural land Development of LIP will compete with land available for agriculture in Machakos County 2 Range resources Implementation of the Master Plan will trigger urbanization and hence reduce habitat for flora and fauna 3 Water resources The development of the LIP could create significant additional demand for water. Without measures for sustainable water supply, water scarcity situation could deteriorate with detrimental impact on aquifers. 4 Energy The proposed LIP will require committed power supply from the national grid which is not always guaranteed. 5 Labor force Depending on quality of jobs generated, the Masterplan could contribute to degradation of the local labour force. Source: SEA Study Team

Building on this assessment and based on the analysis in preceding chapters, the detailed SEA study has examined specific impacts related to the above in each Phase of Masterplan implementation. The SEA is aware that scope and severity of impacts will be specific to investments, site location and technologies applied all of which is not available at this stage. Therefore, impact prediction for the SEA has been conducted at generic level for purposes of providing both an overview of the socio- environmental benefit streams and costs from the Master Plan and for purposes of providing a checklist for downstream ESIA studies.

9.1.2: Tools in Impact Prediction and Analysis Impact prediction for this SEA Study was approached from four directions. They are: i) Baseline characterization surveys entailing literature review, field observations and surveys, and stakeholder consultations; ii) Application of Kenyan Legal Tools ; and iii) Application of available checklists including:

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 The Checklist for Environmental Characteristics developed by the Department of Environmental Affairs of the Republic of South Africa (Appendix 10.1 provides the completed matrix) and;  The Reference Guidelines for Environmental Assessments (which incorporates the Leopold Matrix) developed by USAID /REDSO/ WCA – Abidjan. Appendix 10.2 presents a Leopold Matrix duly completed for this Study. Based on all these tools, potential impacts associated with the development of the LIP have been predicted and analyzed.

9.1.3: Analysis of Impact Severity For purposes of this study, impact prediction has captured three core stages of the proposed development: Design, Construction and Operation stages. The results of the analysis are organized in a Table prepared for each stage, followed by brief highlights of impacts. Likely impacts were analyzed for severity through screening for diverse attributes/ features including magnitude, persistence, potential for reversibility, cumulative nature and tendencies, and potential to occasion secondary and induced impacts. Potential impacts were subsequently ranked on a scale of +2, +1, O, -1 and -2 reflecting Highly Positive, Positive, Neutral, Adverse and Highly Adverse category of impacts respectively. Table 10.2, 10.3 and 10.5 below provide a summary of outcome of impact prediction at each stage of the development of LIP. These results are also presented in Appendix 10.2 in a format following JICA Guidelines for Environmental and Social Considerations.

9.2: Description of Potential Impacts: Design Stage The potential impacts at pre-construction stage implementing the design studies, field surveys and investigations are summarized in Table 10.2 and explained as follows.

Table 9.2: Matrix for Analysis of Impacts at Design Stage

Categor Se Potential Impact Severity Persist Reversi Secondar y ria * ence bility** y l Impact** Natural 1.1 Minor site disturbances -1 Short- Reversi - environ from survey and related term ble ment activities, including consultative meetings Social 1. Creation of opportunities +2 Short- - - environ 2 for gainful employment term ment 1. Minor accidents during -1 Short- Reversi - 3 survey work term ble 1. Public anxiety and -1 Short- Reversi Potential 4 concerns over changes in term ble to livelihood in general and escalate resentment in particular open

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Categor Se Potential Impact Severity Persist Reversi Secondar y ria * ence bility** y l Impact** conflict 1. Generation of additional +1 Long- - - 5 site-specific data /study term reports for Kinanie area 1. Disconnect with the other -1 Short- Reversi Lack of 6 planned developments term ble necessary Others such as the water supply infrastruc ture such as water supply, landfill etc. * Severity +2: Highly positive impact +1:Some positive impact -1: Some adverse impact -2: Highly Adverse impact **Reversibility and secondary impact are assessed only for the adverse impact. Source: SEA Study Team

9.2.1: Positive Impacts at Design Stage As at the time of preparing this report, the Master Plan Study was ongoing and among other findings, few if any adverse impacts were attributed to this process. Generally, the design stage is associated with positive impacts mainly manifested through creation of business opportunities for professionals involved in the design work, support staff hired in the enumeration survey, etc, while the country benefits from generation of additional planning data which will influence policy decisions within long time frames. Certainly, the database compiled from design report will find consumption far beyond the confines of this project. This is the same scenario anticipated even during the design process for individual components of the Master Plan.

9.2.2: Adverse Impacts at Design Stage Adverse impacts would mainly be manifested through site disturbances and accidents associated with field survey work. The survey and other preparatory work could also trigger anxiety and concerns among the local people who anticipate major changes to come. During the Master Plan study and SEA, however, field surveys have created apprehension with villagers concerned that introduction of the Masterplan as proposed would escalate an already existing case of pollution from the Sewerage treatment plant.

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9.3: Description of Potential Impacts: Construction Stage Construction stage impacts are analyzed in Table 10.3 below. Typical of projects involving civil works, the construction stage is most notorious for impact generation. Within the Master Plan, impacts are expected to manifest as follows:

Table 9.2: Analysis of Impacts at Construction Stage

Categor Seri Potential Impact Severit Persisten Reversibilit Secondary y al y * ce y** Impact** Natural 2.1 Slope destabilization -2 Long- Reversible Economic environ- in the Riparian area term costs ment of Mbagathi River /hazard risk 2.2 Sediment generation -2 Long- Reversible Degradati into Mbagthi/Athi term /Irreversibl on of River System e natural environme nt 2.3 Surplus soil generated -2 Long- Irreversible - by construction/ term exploitation of soil/sand for landfill works 2.4 Pressure on water -2 Long- Irreversible Impacts resource at term on existing Construction Stage wells and spring 2.5 Degradation of -1 Longter Irreversible Cumulativ habitat for wildlife m e spp 2.6 Introduction of -2 Long- Irreversible Weakened invasive/ alien species term ecological in construction control materials Pollutio 2.7 Nuisances-dust, water -2 Short- Reversible Health n pollution, noise and term risks control vibrations, soil/sediment contamination and odor from construction work and increase in traffic 2.8 Pollution from -1 Short- Reversible - construction waste, term waste oils and spares Social 2.9 Business opportunities +2 Short- - - Environ in supply and term 104

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Categor Seri Potential Impact Severit Persisten Reversibilit Secondary y al y * ce y** Impact** -ment transport of construction materials, services- food, housing 2.1 Opportunities for +2 Short- - - 0 business and term employment in construction 2.11 Revenue to GoK and +1 Short- - - MCG through taxes term 2.1 Increase in social -1 Short- Reversible - 2 tensions in the term/Lo community due to ng-term influx of outsiders 2.1 Disturbance to village -2 Short- Reversible Social and 3 life, such as access to term Economic primary education costs and other existing infrastructure due to construction activity 2.1 More impact on -2 Short- Reversible - 4 vulnerable people term 2.1 Opportunity for +1 Long- - - 5 change term 2.1 Alteration of the -2 Long- Irreversible Loss of 6 physical landscape term identity 2.1 Traffic load in -1 Short- Reversible - 7 construction work term 2.1 Risk of fire hazards -1 Short- Reversible/ - 8 term Irreversible 2.1 Socio-impacts of -1 Short- Reversible Hazards to 9 construction crew and term public labor camps health 2.2 Occupational health -1 Short- Reversible Economic 0 and safety concerns term costs for construction crew 2.2 Sanitation concerns -1 Short- Reversible 1 from construction term crew Others 2.2 Increase of -1 Short- Reversible Climate 2 Greenhouse Gas in term change material transport due to supply of materials

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Categor Seri Potential Impact Severit Persisten Reversibilit Secondary y al y * ce y** Impact** 2.1 Loss of carbon sink -2 Long- Reversible GHG 3 from destruction of term buildup natural cover vegetation

* Severity +2: Highly positive impact +1:Some positive impact -1: Some adverse impact -2: Highly Adverse impact **Reversibility and secondary impact are assessed only for the adverse impact. Source: SEA Study Team

9.3.1: Positive Impacts at Construction Stage Creation of business opportunities: Figures on development budget for the LIP are not yet available. However, it is expected that significant investment will be made into construction activity, the bulk of which will go into procurement of construction material and hiring of contractors. Construction will thus open up extensive trade opportunities while other economic benefits will accrue through creation of employment opportunities for both skilled and semi-skilled labor engaged in construction. At local level, communities will benefit from short-term employment opportunities in the construction activity.

Creation of opportunity for change: Transformation of an otherwise rural settlement into an international class commercial belt will definitely create momentum for change both within and outside the LIP area. While the transformation entails negative impacts as discussed below, the Master Plan should take advantage of this opportunity to ensure that positive impacts of the LIP can be maximized at local, regional and national levels.

9.3.2: Negative Impacts at Construction Stage i) Destabilization of a riparian area (2.1/2.2/2.3): The Masterplan for LIP as currently conceived has operations in close proximity to the unstable banks of Mbagathi River. Such activity could further expose the banks to erosion while generating sediment into the river system.

ii) Pressure on water resources at Construction (2.4): Construction activity will require huge quantities of water in an already water scarce area where communal water supply is from low yielding boreholes. iii) General concerns on biodiversity (2.5): Issues here include the following:

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Degradation of pockets of biodiversity: This SEA is not aware of any locally vulnerable fauna or floral species within the Kinanie area. However, concerns on biodiversity were identified as a cumulative impact on strategic resources in 8.4 above. Some pockets of wildlife, mainly Zebras are encountered roaming freely in the Kinanie probably within the dispersal area for wildlife in the Nairobi National park. The habitat, especially foraging areas, migratory and watering corridors and blessing sanctuaries for such biodiversity is increasingly being lost to land subdivisions, paddocking and settlement, making it impossible to maintain minimum viable populations necessary for survival of particular species. With urbanization associated with operationalization of the LIP, wildlife habitat will come under greater threat from loss of habitat and even poaching for food hence calling for concerted efforts in mitigation.

Plate 9.1: A herd of Zebras grazing in Kinanie area iv) Potential introduction of invasive species (2.6): One of the most common adverse impacts of construction activity in Kenya is the introduction of invasive species brought in mainly in contaminated building material such as stones, sand, ballast, etc. Once introduced, the species spreads quickly to colonize the area and become a noxious weed, of which the best example is the Prosopis chilensis (Mathenge) tree. In case of the proposed LIP, there is fear that introduction of the Mathenge weed has potential to completely colonize and destroy the entire riparian area of Mbagathi down to the Indian Ocean with very costly impacts even to local livelihoods.

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Source: This Study Plate 9.1: Prosopis Colonies

v) Nuisances-dust, fumes, vibrations from operation of plant and equipment (2.7): From available data of air quality monitoring generated from other studies,

Particulate Matter (PM10) in Nairobi exceeds statutory limits while day-time noise levels exceeded standards recommended by NEMA. As such, generation of fumes, dust and noise in construction activity within the windward area of Nairobi will only compound an already severe situation which could expose people to health hazards. Elevated noise and dust levels are likely to affect quality of life in the neighbourhood, more so, in the hospitality and service sector already taking root in the area.

vi) Generation of construction waste (2.8): Waste from civil works in the LIP comprises surplus soil, packaging, debris, waste spares and oils, scrap from workshops etc all of which has potential to pose environmental challenges unless appropriately disposed. vii) Disruption of village life (2.13/14): Construction activity will set in motion many activities running simultaneously in an otherwise quiet area. Activities such as movement of plant and equipment, establishment of labour camps, stripping of the ground together with trees, roads, boundary fences by strange looking machines and people, amidst influx of job speculators are likely to challenge even the most sober and level headed of villagers. Before people can reorganize and settle to new routines, reorient to the new way of doing things and getting around, a lot of time may be wasted and this could even turn costly in terms of rural economic activity. Construction is further likely to interface with several service lines such as water pipeline, power distribution lines, etc all of which serve vital functions in the local, national and regional economies and whose disruption is likely to occasion massive suffering. viii) Pressure on fresh water resources (2.18): Freshwater is not easy to come by within the entire Kinanie area where communities mainly rely on boreholes. The 108

EPZA: Strategic Environmental Assessment for the Master Plan for the Leather Industrial Park design process must take time to introduce viable source of water for construction to avoid competition with communities along the traverse. The option of sinking boreholes is not a viable option given the low yield and potential for drawdown. ix) Traffic load in construction work (2.17): Civil works will require huge quantities of material to be routinely delivered by numerous heavy trucks plying the local roads. Construction vehicles in Kenya are notorious for their wanting respect for traffic rules and the rights of other road users. On numerous occasions, such attitude is a precursor for traffic accidents. x) Social vices associated with construction crews (2.19): Construction activity will engage and deploy numerous people on a daily basis in villages and such exposure is likely to trigger cultural shocks and tendencies associated with multitudes to the detriment of local residents. Core hazards would include proliferation of social vices including commercial sex, drug and alcohol abuse, juvenile delinquency, among others. Uncontrolled spread of such vices potentially lead to explosion of teenage motherhoods, breakdown of homes, escalation of sexually transmitted diseases including HIV and AIDs, social disorders, among others which would rapidly erode positive impacts associated with construction activity. xi) Occupational health and safety concerns for construction crew (2.20): Concerns emanate from industrial/ occupational hazards (injuries, fatalities, ailment, etc) associated with operation of and use of tools, plants and equipment deployed in a major and complex building projects as anticipated under auspices LIP . Construction activity especially dredging for port development will pose locally unique challenges all of which compound occupational hazards associated with the project. xii) Sanitation concerns for construction crews (2.21): The massive sea of humanity to be engaged in road construction have specific sanitation needs whose inadequate supply would see any available bunch, gully, etc turned into a toilet with attendant threats to public health. xiii) Increase of Greenhouse Gases in material sourcing and transport (2.22): This SEA assumes that all material to be used in building road construction will be sourced locally as a way of reducing cost and cutting down on carbon footprint. Irrespective of this, transportation of the materials to the point of construction will involve burning of fossil fuels and release of Greenhouse Gass (GHG) into the atmosphere. The greater the distance travelled, the more the GHG released. Transportation of construction materials and operation of plant and equipment for the construction work in Masterplan area will generate significant quantities of GHG. It is generally accepted that any carbon fuel emits 3.15 times its own weight of carbon dioxide when burnt (Bliss, J., 2008) implying that construction alone will have a major carbon footprint let along those associated with operation of the LIP over the long- term. xiv) Loss of carbon sink in clearing of green area (2.23): The development of Master Plan area will involve clearing of 500 acres currently under an Eucalyptus plantation and is thus a loss on the carbon sink. This represent a net loss to the global fight against climate change.

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9.4: Description of Potential Impacts: Operation Stage The potential impacts at operation stage – the opening and operation of Tanneries, Value addition parks, offices, housing, support facilities etc and any other services in LIP area – are analyzed in Table 9.5 below. Development of the LIP as conceived has numerous benefits with some attendant social and environmental costs. These are briefly highlighted in sections below.

9.4.1: Positive impacts at Operation Stage i) Gains to the national economy: The national economy will gain from injection of foreign investments, export based economy, income from tourism and increased import trade. All of this will generate resources needed to finance other government programs. This is the single most important positive effect of the Master Plan. ii) Benefits to the local economy: The local economy will gain from job creation, creation of market for local goods and services and increased trade opportunities. iii) Development of the property market in Kinanie Division.: Once investment in the LIP takes off, it will attract simultaneous development especially in real estate and entertainment in the surrounding areas.

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Table 9.3: Analysis of Impacts at Operation Stage

Categor Seri Nature of Impact Sever Persist Reversibi Secondary y al ity ence lity** impacts** Natural 3.1 Degradation of -1 Long- Irreversib - environ- ecological systems and term le ment biodiversity Pollutio 3.2 Surface runoff and -1 Long- Irreversib Land n washing of pollutants term le degradation control from built up area from erosion/mar ine pollution/sil tation in creek 3.3 Generation of effluent -2 Long- Irreversib Degradatio loads from tanneries term le n of sewerage downstrea m water supply 3.4 Increased solid waste -2 Long- Reversibl Will term e compound an existing problem 3.5 Increased atmospheric -2 Long- Irreversib Will and ambient pollutants term le compound an existing problem 3.6 Increased solid waste -2 Long- Reversibl Will term e compound an existing problem Social 3.7 Benefits to the national +2 Long- - - environ economy from FDI term -ment (Foreign Direct Investment), exports and job creation 3.8 Revamping of the local +2 Long- - - economy through job term creation and emerging opportunities, markets 3.9 Enhanced economic +2 Long- - - utilization of Hides and term Skins resource 3.1 Enhanced value of +2 Long- - - 0 property in adjoining term 111

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area 3.11 Attraction of other +2 Long- - - economic activity term 3.1 Improvement of quality +2 Long- - - 2 life and service for term neighbourhood 3.1 Tendency to attract non -2 Long- Irreversib Non 3 planned development term le sustainable settlements 3.1 Pressure on water and -2 Long- Irreversib Depletion 4 other resources term le of aquifers Others 3.1 Accidents and hazards -2 Long- Irreversib Hazards to 5 at facilities in operation term le/ public (fire and explosions, Reversibl health chemical/physical e hazards etc) 3.1 Increase of Greenhouse -2 Long- Irreversib - 6 Gas by operation of term le/ facilities and Reversibl transportation e

: Adverse impact is expected. * Severity +2: Highly positive impact +1: Some positive impact -1: Some adverse impact -2: Highly Adverse impact **Reversibility and secondary impact are assessed only for the adverse impact. Source: SEA Team Study Team

9.4.2: General adverse impacts at Operation Stage From Table 9.3 above, adverse impacts from the operation stage have been identified as follows: i) Increased atmospheric emissions and noise from motor vehicles (3.5): Upon commissioning of the new road and diversion of traffic, there is likely to be a sharp increase in noise levels which may go beyond the tolerance limits. ii) Increased environmental burden caused by tenants‘ operation (3.5): The emission gas, waste water, noise and vibration and offensive odor from the operation of tanneries will deteriorate the ambient environment quality. The leakage of hazardous material also might cause soil contamination. Though groundwater pumping is not recommended in LIP, ground subsidence might occur depending on circumstances. The extent of such impact depends on the type/scale of construction, design of facilities and positional relation with sensitive receptors. The detail impact shall be examined by EIA in the subsequent F/S for each investment.

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EPZA: Strategic Environmental Assessment for the Master Plan for the Leather Industrial Park iii) Uncontrolled development outside the LIP (3.13): A major potential for development of the LIP at in Kinanie to attract simultaneous but non planned development in adjoining areas. As such, Machakos County may inherit the burden of providing infrastructure previously not anticipated which may strain their budget. The feedback from stakeholders should be taken into account during the phased development of the LIP to ensure that such issues are not ignored. As briefly discussed in Chapter 7, the preparation of the County Integrated Development Plan also offers an important platform to devise measures to address such induced development in a wider scale. iv) Pressure on water resources (3.14): Once operating at full capacity, the LIP is anticipated to consume significant amount of water for industries, daily use and drinking. Kinanie is not connected to the water mains and there are no immediate plans to developed bulk water supply for the area. 9.4.3: Impacts Specific to the Leather Tanning Process Leather Value Addition is the main object of the proposed Leather Industrial Park at Kinanie in which case, a more focused impact assessment process targeting all operations is necessary. A detailed analysis of pollution impacts within the leather value chain is provided in appendix 9.1. An analysis of waster generation from different stages of the Tanning process is provided in sections below based on analysis of Fig 9.1. (i) Impacts from operationalization of tanneries This section analysis the potential impacts of operationalization of tanneries based on a production model of 36 Tanneries as proposed. The analysis is based on the combined experience of the SEA Team as further informed by diverse authorizes key among them being:-  United Nations Environment Programme-Industry and Environment Unit, 1996: Cleaner Production in Leather Tanning-A Workbook for Trainers  United Nations Industrial Development Organization 2000: Chrome Management in the Tanyard, Regional Programme for Pollution Control in the Tanning Industry in South-East Asia (US/RAS/92/120/11-51).  Kaul S, N, 2005: Wastewater Management: With Special Reference to Tanneries

Overview of the Leather Tanning Process Leather processing entails four stages, each of which is briefly analyzed below:- Stage One: Pre-tanning Raw hides when produced at slaughterhouses are preserved by wet salting, dry salting, pickling or drying for transport to tanneries and further treatment. It is estimated that about 300kg of chemicals such as lime and salt is used per ton of hide produced. Some of the processes in the pre-tanning stage include: Soaking: The preserved raw hides and skin regain their normal water contents. Dirt, manure, blood, preservatives such as sodium chloride and bactericides are removed.

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EPZA: Strategic Environmental Assessment for the Master Plan for the Leather Industrial Park

Liming: The well soaked hides or skins are then subjected to sodium sulphide and lime to remove the hair and to swell the fibres for easy removal of non-structural proteins. Fleshing and trimming: Fleshing is the removal of excessive meat. It precedes unhairing and liming. Extraneous tissues and hair is removed by use of chemicals with alkaline medium of sulphide and lime. Trimming is done to remove unwanted flaps for the material to gain shape. Deliming and bating: The shaved fleshes and alkaline hides are neutralized, a process called deliming, with acid ammonium salts and treated with enzymes to remove hair remnants and to degrade proteins. During this process hair roots and pigments are removed. The hides and skins become softer by this treatment. Pickling :Pickling reduces the pH of the hide enabling tannins to enter the hides and skins. Salts are added first to prevent the hides from acid swelling. For preservation purposes fungicides and bactericides are applied. Stage Two: Tanning During tanning there are two possible processes. The first one is mineral tannage where chrome tanning is preferred and the second is vegetable tanning. Vegetable tanning: Vegetable tanning is usually accomplished by series of vats with increasing concentration of tanning liquor. Vegetable tannins are mainly two types of polyphonic compounds: hydrolysable tannins and condensed tannins. Vegetable tanning are thought to result from hydrogen bonding of the tanning phenolic groups to the peptide bonds of the protein chains. In some cases it is estimated that 50% by weight of tannin is incorporated into the hides and skins. Chrome tanning: In tanning Chromium III (33% basic) is used as it has affinity to bind to the collagen and get fixed. The presence and concentration of Chrome forms in effluents depends on Chromium compounds applied during processing, pH, organic and/or inorganic waste coming from the material processing. Cr3+ dominates from tanneries. Chromium hazards due to environmental contamination, depend on its oxidation state (i.e. hexavalent stage of chromium (Cr6+) is more toxic than the Cr3+which precipitates at higher pH. Trivalent chromium is unable to enter into cells but Cr6+enters through membrane anionic transporters. Stage Three: Finishing Wet Blue: Hides and skins, especially those that have used the chromium tanning process, are retanned, during which process, diverse tanning agents are combined - and treated with dye and fat to obtain proper filling , smoothness and colour. Surplus water is removed to make the hides and skins suitable for splitting and shaving. This produces the Wet Blue Grade. Crust Grade: The crust that results after retanning and drying is subjected to a number of finishing operations. The purpose of these operations is to make the hides and skins softer and to mask small mistakes. The hides and skins are treated with an organic solvent or water based dye and varnish. The finished product has between 66 and 85 weight percent of dry matter. (ii) Inputs in leather tanning 114

EPZA: Strategic Environmental Assessment for the Master Plan for the Leather Industrial Park

Main inputs in Leather tanning are raw hides and skins (raw material), water and chemicals. Chemical Consumption: For a detailed analysis of the schedule of chemicals applied in the Tanning process, the author is referred to UNEP, 1996. Leather preservation and tanning process consumes huge quantities of chemicals, the main of which is common salt. Typical chemical inputs include:- Chemical Quantity (kg)/ ton Common salt (Nacl) 1000 Lime 20 Ammonium sulphate 20 Sodium sulphide 7.5 Acids (Formic acid, Sulphuric acid)

It is the process of washing off chemical residues that consumes water and emits water with huge dissolved salt content that accounts for the high COD in tannery effluent. Water Consumption; Typical water consumption in the tanning process ranges from 30 to 100litres per tonne of raw hide tanned largely averaging to 50 cubic metres. Assuming a tanning regime involving 36 tanneries at Kinanie, projected water demand in for diverse sizes of tanning operations is analysed in table 9.4 below. Essentially, huge quantities would be required in an other wise water stress area. Indeed, water requirement in tanning would pose the most severe constrains to operationalization of the LIP as currently conceived.

Table 9.4: Projected water demand in operationalization of 36 tanneries Tannery Capacity Water Monthly Monthly Annual Annual size (tons/ use m3 water demand for 36 demand demand by month) per ton demand tanneries per 36 tannery tanneries Large 1850 50 92,500 3,330,000 1,110,000 39,960,00 0 Medium 900 50 45,000 1,620,000 19,440,00 540,000 0 Small 450 50 22,500 810,000 270,000 9,720,000 Source: This Study

(iii) Schedule of other impacts: Fig 9.1 presents an analysis of effluents generated in the tanning process quantities of which are summarized in Table 9.5. Tanning operations are likely to emit solid, liquid and air born pollutants as briefly highlighted below.

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EPZA: Strategic Environmental Assessment for the Master Plan for the Leather Industrial Park

Solid Effluent: Solid effluent comprises of organic wastes such as green fleshing (mainly fat and meat shaved off the skin), shavings, trimmings, and splitting amounting to 16% of the raw material base. The solid effluent also contains chemical trappings such as lime, chrome splits, among others. Conventionally, tanning of one tonne of hide produces between 700 to 800 kg of waste comprised of 270kg of organic waste and another 420 kg of inorganic solids. It is the organic solids (shavings and trimmings) that foul the air when exposed to natural petrification. As well, organic solids contain chromium and other salts considered harmful to the environment.

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EPZA: Strategic Environmental Assessment for the Master Plan for the Leather Industrial Park

Source: UNEP, 1996 Fig 9.1: Generation of pollutants in the Leather Value Chain

Liquid effluent: For every tonne of Hides and Skins tanned, 15.5 cubic metres of foul water is generated, making it the most drastic of wastes from tanning. The implication therefore, is that, a single large sized tannery of 7800ton annual capacity will generate 120, 900 cubic metres of effluent water equivalent to 331.2 cubic metres a day. By extension, 36 tanneries have a potential daily discharge of 11,924.4 cubic metres of foul water. Such foul water is high in BOD and COD which, when released into natural systems exert pressure for available oxygen thus making it difficult for

117

EPZA: Strategic Environmental Assessment for the Master Plan for the Leather Industrial Park aquatic life to function normally. Further, such high COD increases the osmotic potential of the water and any adjacent soil thus making it impossible for organisms to survive in the water while interfering with the osmotic process that sustain plant life, The salt content is also disperses soil structure thus interfering with the porosity and permeability functions so critical to absorption and retention of water.

Table 9.5: Effluent generation in the tanning process Pollution from processing one tonne of rawhide Discharge/kg conventional cleaner percentage production production reduction Effluent volume 15.5 7.8 50% (m3) Lime (total) 20.0 10.0 50% Solids (inorganic) 420.5 291.0 31% COD 133.3 63.9 52% BOD 43.5 20.7 52% Salt 415.0 165.0 60% Sulphide 7.5 5.25 30% Fleshings* 150.0 150.0 0% Trimmings* 120.0 120.0 0% Ammoniacal N in 54.0 0.0 100% effluent Gaseous ammonia 54.o 0.0 100% Source: UNEP, 1996

By far, the most harmful of toxicants in tannery effluent is Chromium, a heavy metal whose presence and concentration in effluent depends on Cr compounds applied during processing, pH and other factors. Though Cr3+ is the most common of Chromium in tannery waste, with ever ongoing chemical reactions, occurring in the sludge, an increase in the hexavalent form (Cr+6)- a known toxicant and carcinogen occurs. The LD50 for hexavalent chromium ranges between 50 and 150 mg/kg. The compound is acutely toxicity due to its strong oxidative reactions which damages blood cells leading to haemolysis, and subsequently kidney and liver failure once in the bloodstream, on account of which, hexavalent chromium is one of the substances whose use is restricted by the European Restriction of Hazardous Substances Directivee while the World Health Organization-recommended maximum allowable concentration in drinking water is 0.05milligrams per litre, the same limit enforced by NEMA under Legal Notice 120 of 29th September 2006 for discharge into the environment.

Chromium salts (chromates) are also the cause of allergic reactions in some people. Contact with products containing chromates can lead to allergic contact dermatitis and irritant dermatitis, resulting in ulceration of the skin, sometimes referred to as "chrome ulcers". This condition is often found in workers that have been exposed to strong chromate solutions in electroplating, tanning and chrome- producing manufacturers. 118

EPZA: Strategic Environmental Assessment for the Master Plan for the Leather Industrial Park

Airborne pollutants: Airborne pollutants from tannery operations mainly include Hydrogen Sulphide -the rotten egg smelling gas, ammonia and solvents such as formaldehyde.

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EPZA: Strategic Environmental Assessment for the Master Plan for the Leather Industrial Park

10 Framework for Environmental and Social Management 10.1: Overview This chapter outlines the Environmental and Social Management Plan (ESMP) proposed for the Master Plan for LIP. At the SEA Level, the ESMP focuses more on providing a framework for the management of likely environmental and social impacts on key resources, rather than articulating detailed resolution for specific impacts, which will be identified and analyzed downstream during EIA for specific investments.

10.2: Principles in Environmental and Social Management To the largest extent possible, the strategy and action plan in formulating this Environmental and Social Management Plan (ESMP) is to prevent impact occurrence in the first place, then to mitigate inevitable occurrence of adverse impacts. To ensure that this principle be adhered to throughout the operation of the LIP, it is imperative that the SEA and EIA downstream be closely linked – tiering of environmental assessment at different levels3. In pursuit of this strategy, all mitigation will be sealed at Feasibility Study and Detailed Design Stage for each project by adopting measures as follows:

 The Environmental and Social Management Plan will inform the Feasibility Study and Design Report to be prepared by each project or developer.  The same is applied to the Bills of Quantities (BOQs) to ensure funding allocation for environmental and social mitigation.  Clauses binding parties to actions on the ESMP will be integrated into contracts for construction to ensure that the contractor is legally bound to implement necessary mitigation measures. Sections below discuss proposed mitigation measures in each stage of the project that is built upon this principle.

10.3: Mitigation through Design Review in the Masterplan

Chapter Seven above attempted an analysis of the viability of the LIP Model based on analysis of different options in delivering on the GOK aspirations for the investment. Based on analysis in Chapter Five, Six and Seven above, the following pertinent observations emerged:-

Availability of Hides and Skins to support new tanneries: On supply of raw materials: It emerged that all tanneries in Kenya are currently operating at 60-80% capacity mainly producing Wet Blue Grade leather for export. It further emerged that the available resource base in hides and skins can only support either, one additional large-scale tannery or 6 small size tanneries. Currently, there are 14 tanneries operating in Kenya and plans are at an advanced stage to establish 6 others at County level. The implication here is that, all surplus

3 A tiered approach minimizes the problem of EIA being only a “snapshot in time.” The EU SEA-Directive (2001/42/EC), for example, explicitly assumes tiering of SEA and EIA at different levels and the SEA and EIA Directive are directly linked (e.g. article 3(2) of Directive 2001/42/EC requires SEA for those plans and programs, which set the framework for future development consent of EIA projects). 120

EPZA: Strategic Environmental Assessment for the Master Plan for the Leather Industrial Park hides and skins will go into feeding the six proposed tanneries leaving no raw materials to support new tanneries at Kinanie.

Alternatives in delivering on the LIP Model: From analysis in Chapter Six above, it emerged that the most viable option in achieving goals of the LIP is an investment package entailing creation of a Value Addition park at Kinanie which will be supplied with locally produced Wet Blue Grade leather for value addition right to finished products. This Model-the Kinanie Model will side step all Beam House operations and will see new tanneries established for treating leather from the Wet Blue stage onwards thus avoiding the many complications associated with treatment of raw leather, gains from the Kinanie Model will include:-

 Freeing the available surplus leather for use in other counties,  Cutting down on water demand which is already a major constraint in the Athi River Basin  Cutting down on the pollution load (solid, liquid and airborne effluents associated with the Beam House Operations,  Assuring equitable distribution of benefit streams at all levels of operation, Kinanie, County and national Government level

As such, the most fundamental mitigation to potential adverse impacts at Kinanie is design review to adopt either the Kinanie Model as proposed in Chapter Six or any variation that is heavy on value addition and light on primary tanning.

Proposed options in mitigating specific impacts are outlined in sections below.

10.4: Mitigation for Design Stage Hazards

Table 10.4 provides proposed mitigation for design stage activities. Site disturbance during field surveys should be minimized by the optimization of survey method – carefully selecting the survey method, period, equipment, and location, among others. For example, the use of existing tracks to access sites of interest will help avoid damage to crop and existing vegetation. The reconnaissance will be useful to identify the sensitive point and/or vulnerable natural resource prior to the investigation. In addition, sober and serious minded survey teams will be selected and trained on the need to observe safety requirements during enumeration and site surveys and this can greatly mitigate incidence of accidents. Implementation of the Master Plan will develop and support a liaison system to ensure continuous flow of information to all stakeholders to alleviate public anxiety and enhance the relationship with the related organizations and projects. This will also help avoid duplication of similar work by parties involved in the development of the LIP.

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Table 10.4 Mitigation Measures for Predicted Adverse Impacts at Design Stage

Catego Serial Potential Impact Mitigation Post StrategicEnvironmental Assessment ry * Mitigation Description Sever Persist Reversi Severity** ity * ence bility

Natural 1.1 Minor site disturbances from survey and -1 Short- Reversi - Optimization of survey method 0 environ related activities, including bathymetric, term ble ment boring, clearing of natural vegetations

Social 1.3 Minor accidents during survey work -1 Short- Reversi - Safety communication and training 0 environ term ble - Safety measures (Personal Protective Equipment ment etc.)

for 1.4 Public anxiety and concerns over impacsts -1 Short- Reversi - Information disclosure and public consultation of 0

theMaster Plan for from proposed new tanneries term ble project-related plan

Others 1.7 Disconnect over presence and impacts of -1 Short- Reversi - Coordination with related MPs supervised by 0

122 the sewerage system term ble County Government and other stakeholders - Information sharing and frequent consultation

among the related agencies and projects

Development of

1.8 Interference with the flight path to Nairobi -1 Short- Reversi - Coordination with the other existing facilities’ 0 International Airport term ble function

* Only adverse impacts were extracted from the result of impact assessment in Chapter 10.These serial numbers correspond with ones in Table Mombasa SpecialEconomic Zone 10.1. ** Severity +2: Highly positive impact +1:Some positive impact 0: No impact -1: Some adverse impact -2: Highly Adverse impact **Reversibility and secondary impact are assessed only for the adverse impact

EPZA: Strategic Environmental Assessment for the Master Plan for Leather Industrial Park

10.5: Mitigation Measures at Construction Stage

10.5.1: Mitigation of Landscape destabilization

Destabilization of the Riparian Zone for Mbagathi River The Master Plan process has identified sites with favorable topography for physical development while riparian ground and waterways will be reserved for conservation. However, where civil works slope destabilization is inevitable, soil stabilization measures will be put in place to prevent soil wash into the Mbathathi-Athi system. Towards this goal, following approaches will be adopted:

i) Peg and isolate the Riparian reserve in line with the Water Act and the Water Resource Management Rules, 2007 (Legal Notice 171 of 28th September 2007) ii) Reduce sediment production from areas of disturbed soils, and minimize sediment off- site transport through use of settlement ponds, sediment trap and silt fences, and modifying or suspending activities during extreme rainfall and high winds. iii) Minimize the area of disturbed soil and protect vegetation not intended for removal by marking, fencing and wrapping as necessary, and reduce the time that soil is left disturbed to prevent soil erosion. iv) Prevent storm-water from entering areas of disturbed soil from outside the site and from other parts of the site by stockpiling and ring-guarding soil and construction materials. v) Control on-site water use to minimize soil erosion. vi) Schedule civil works to avoid seasons of torrential rainfall to the extent practical.

Loss of habitat for Fauna and flora Flora mapping and screening against the IUCN Red List undertaken as part of this SEA indicated that no species considered endemic, threatened, endangered or locally important are found within the Master Plan area. However, the study came across isolated herds of zebras whose habitat is increasingly being lost to paddocking, and fencing, human settlement and others and whose survival under the Masterplan scenario is not guaranteed owing to the anticipated increase in urban land use. The recommendation here is for the EPZA to incorporate wildlife within the LIP following the model used by Bamburi Cement in Mombasa adopted. Preference will be given to afforestation using local tree species. This notwithstanding, measures will be taken as follows:

i) Preservation of the below ground biodiversity on undisturbed sites will be of high priority. Areas that have remained intact over generations are reservoirs of biodiversity and, and more importantly, serves as soil seed bank – natural seed repositories. Thus, in the extreme case where vegetation on such site will be displaced, the above-ground genetic resource will require to be mapped for re-introduction elsewhere around. More critically, it can be recommended that all top soil from such sites will be recovered and re-deposited at designated undisturbed sites. Requirements of the Environmental

123 EPZA: Strategic Environmental Assessment for the Master Plan for Leather Industrial Park

Management and Co-ordination (Conservation of Biological Diversity and Resources, Access to Genetic Resources and Benefit Sharing) Regulations, 2006 shall apply. ii) Site specific reforestation plans will be implemented to offset the loss of vegetation/forest cover. Locally active conservation groups will be strengthened to supply the bulk seedlings of locally important trees, some of which will be used in road side reforestation and planting on communal sites.

Introduction of Invasive Species An increase in the traffic volume and the transport of construction materials associated during the construction stage will increase the risk of introduction of invasive species, which has already been observed in many parts of Kenya. In order to prevent and control intrusion of invasive species, it is necessary to identify target species and develop control or management options for each target species. Several options are available for controlling invasive species. Chemical control (herbicides) is typically used for controlling the majority of invasive species. If used selectively and in limited areas, herbicides can be successfully applied in an environmentally- sound manner. Mechanical control measures, such as digging/pulling or cutting, may be effective in controlling isolated invasive plants, but such techniques may be labor-intensive and could require extensive excavation. In any case, specific control measures shall be refined based on the results of risk assessment.

10.5.2: Pollution control from Construction Activity

(i) Solid Waste Management All storage and construction sites are to be kept clean, neat and tidy at all times. No burying or dumping of any waste materials, metallic waste, litter or refuse shall be permitted. The Contractor must adhere to Environmental Management and Co-ordination (Waste Management) Regulations 2006. The Contractor shall also implement measures to minimize waste and develop a waste management plan to include the following:

i) All personnel shall be instructed to dispose of all waste in a proper manner. ii) At all places of work, the contractor shall provide litter collection facilities. iii) The final disposal at the site shall be done in consultation with local administration and leaders. iv) The provision of sufficient bins (preferably vermin and weatherproof) at the camp and work sites to store the solid waste produced on a daily basis. v) Materials used or generated by construction shall be recovered at the conclusion of each task for safe disposal including recycling, to the extent practical. vi) Provision for responsible management of any hazardous waste generated during the construction works.

124 EPZA: Strategic Environmental Assessment for the Master Plan for Leather Industrial Park

Wastewater Water Management No grey water runoff or uncontrolled discharges from any site or working areas (including wash- down areas) to adjacent watercourses and/or water bodies shall be permitted. The proposed measures for wastewater management include:

i) Water containing such pollutants as cements, concrete, lime, chemicals and fuels shall be discharged into a conservancy tank for removal from site. This applies to water emanating from concrete batching plants and concrete swills in particular. ii) The Contractor shall prevent runoff loaded with sediment and other suspended materials from the site/working areas from discharging to adjacent watercourses and/or water bodies. iii) Potential pollutants of any kind and in any form shall be kept, stored and used in such a manner that any escape can be contained and the water table is not endangered. iv) Wash areas shall be placed and constructed to ensure that the surrounding areas (including groundwater) are not polluted. v) The Contractor shall report any pollution incidents on site.

Noise, Vibrations and Odor Construction activities as well as increases in traffic volume to supply construction materials will trigger nuisance and possibly expose local people to health hazard. During the construction stage, the developer should follow the standards recommended by NEMA and international good practice to ensure that the impacts will be minimized. The detailed approach, for example, controlling the volume of daily traffic and timing avoiding construction work during the peak commute time, will be elaborated in the EIA downstream.

General Materials Handling, Use and Storage The following rules should be in place to ensure sound handling and storage of materials.

i) All imported fill, soil and/or sand materials shall be free of weeds, litter and contaminants. Sources of imported materials shall be listed and managed. ii) The Contractor shall ensure that delivery drivers are informed of all procedures and restrictions (including ‗No go‘ areas). iii) Any electrical or petrol driven pumps shall be equipped and positioned so as not to cause any danger of ignition of the stored product. iv) Collection containers (e.g. drip trays) shall be placed under all dispensing mechanisms for hydrocarbons or hazardous liquid substances to ensure no contamination from any leaks is reduced. v) Regular checks shall be conducted by the Contractor on the dispensing mechanisms for all above ground storage tanks to ensure faulty equipment is identified and replaced in timely manner.

125 EPZA: Strategic Environmental Assessment for the Master Plan for Leather Industrial Park

Miscellaneous

10.5.3: Occupational Health and Safety

Mitigation of Impacts in General Health and Safety The Contractor shall comply with all standard and legally required health and safety regulations as promulgated by Occupational Health and Safety Act and the Factories and Other Places of Work Regulations. The detailed should be elaborated depending on the nature of activities, but they primarily include the following:

i) The Contractor shall provide a standard first aid kit to field staff. ii) The Contractor shall ensure that staff are made aware of the risks of contracting or spreading sexually transmitted diseases, particularly HIV/AIDS and how to prevent or minimize such risks. iii) The Contractor shall be responsible for the protection of the public and public property from any dangers associated with construction activities, and for the safe and easy passage of pedestrians and traffic in areas affected by the construction activities. iv) All works which may pose a hazard to humans and domestic animals are to be protected, fenced, demarcated or cordoned. If appropriate, symbolic warning signs must be erected. v) Speed limits appropriate to the vehicles driven are to be observed at all times on access and haul roads. Operators and drivers are to ensure that they limit their potential to endanger humans and animals at all times by observing strict safety precautions. vi) No unauthorized firearms are permitted on site. vii) The Contractor shall provide the appropriate Personal Protective Equipment for staff.

Fire Prevention and Control The Contractor shall take all reasonable and precautionary steps to ensure that fires are not started as a consequence of construction activities on site. The measures include, but not limited to the following:

i) The Contractor shall ensure that there is basic fire-fighting equipment available on site. ii) Flammable materials should be stored under conditions that will limit the potential for ignition and the spread of fires. iii) ‗Hot‘ work activities shall be restricted to specific site. iv) Smoking shall not be permitted in those areas where there is a fire hazard. These areas shall include any areas (e.g. bush lands) where vegetation or other material is such as to make liable the rapid spread of an initial flame. v) The Contractor shall ensure that all site personnel are aware of the fire risks and how to deal with any fires that occur. This shall include, but not be limited to regular fire prevention talks and drills and, posting of regular reminders to staff. vi) Any fires that occur shall be reported immediately and then to the relevant authorities.

126 EPZA: Strategic Environmental Assessment for the Master Plan for Leather Industrial Park vii) In the event of a fire, the Contractor shall immediately employ such plant and personnel as is at his disposal and take all necessary action to prevent the spread of the fire and bring the fire under control. viii) Costs incurred through fire damage will be the responsibility of the Contractor, should the Contractor‘s staff be proven responsible for such a fire.

Emergency Procedures The Contractor shall submit Method Statements covering the procedures for the main activities which could generate emergency situations due to accidents or neglect of responsibilities. These situations include, but not limited to: accidents at the work place including wildlife invested areas, accidental fires; accidental leaks and spillages and vehicle and plant accidents. Measures to be in place include:

i) The Contractor shall ensure that his employees are drilled in the procedure for working in protected areas as provided for in Cap 376 and Forests Act of 2005 ii) The Contractor shall also ensure that the necessary equipment for work in hazardous area –protective boots, PPEs, and helmets – are provided.

Mitigation of HIV/AIDS: The contractor in consultation with implementing agencies responsible for HIV/AIDS will initiate educational campaigns to keep workers and the local community sensitized on the reality of this pandemic. The activities shall also be monitored on a regular basis to assess effectiveness and impact. This should include an initial, interim and final assessment of basic knowledge, attitude and practices taking into account existing data sources and recognizing. The assessment will be supported by qualitative information from observations on workers behavior.

10.5.4: Summary of Mitigation Measures at Construction Stage Mitigation measures for the construction stage are summarized in Table 10.5.

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Table 10.5 Mitigation Measures for Predicted Adverse Impacts at Construction Stage

Serial* Potential Impact Mitigation Post StrategicEnvironmental Assessment Mitigation Category Description Severit Persiste Reversibility Severity** y * nce

Natural 2.1 Slope destabilization in the -2 Long- Reversible - Soil stabilization measures 0 environ- Mbagathi River banks term ment 2.2 Sediment generation into -2 Long- Reversible - Physical detention of sediments 0 Mabgathi from term /Irreversible - Minimization of soil generation from construction activities construction work and site

for 2.3 Hydrological change of -2 Long- Irreversible - Earthworks in dry season -1

theMaster Plan for surface/ground water due term - Securement of water channel or to earthworks and restoration pond for stormwater probability of ground - Further investigation in the F/S of each subsidence subproject

128 2.4 Surplus soil generated by -2 Long- Irreversible - Equation of cut earth volume and filling 0

construction/ exploitation term volume Development of of soil/sand for landfill works

2.5 Interference with -2 Long- Reversible/ - Create a wildlife sanctuary in the LIP -1

ecological systems and term Irreversible

Mombasa SpecialEconomic Zone biodiversity

2.6 Destruction of biodiversity -1 Long- Reversible - Preservation of highly prioritized 0 term reservoir of biodiversity

2.7 Introduction of invasive/ -2 Long- Irreversible - Screening of original sites of material -1 alien species in term construction materials

Pollution 2.8 Nuisances-dust, water -2 Short- Reversible - Adhere to OSHA 2007 0 control pollution, noise and term - Optimization of construction device,

vibrations, soil/sediment method, schedule and transportation

Serial* Potential Impact Mitigation Post

Mitigation StrategicEnvironmental Assessment Category Description Severit Persiste Reversibility Severity** y * nce

contamination and odor route etc. to minimize the effect to the from construction work sensitive receptor and increase in traffic - Soil contamination investigation, if the soil is transferred in and out of the site 2.9 Pollution from -1 Short- Reversible - Development of waste management 2 construction waste, waste term plan oils and spares

for Social 2.10 Disturbance to livelihood Long- Reversible - Minimize period of disturbance 2

theMaster Plan for Environ- eg transport term ment -2 2

2.11 Increase in social tensions -1 Short- Reversible - Rationalized approach to job allocation 0

129 in the community due to term/L influx of outsiders ong-

term Development of

2.12 Disturbance to village life, -2 Short- Reversible - Information sharing at all phases of -1 such as access to primary term implementation education and other existing infrastructure due

Mombasa SpecialEconomic Zone to construction activity

Others 2.13 Pressure on water -1 Short- Reversible/ - Develop Masterplan for water supply 0 resources and supply term/ Irreversible Long- term

2.14 More impact on -2 Short- Reversible - To be undertaken in RAP including the 0 vulnerable people term livelihood restoration plan

2.15 Alteration of the physical -2 Long- Irreversible - Identification and prevention of -1

landscape term aesthetic area

Serial* Potential Impact Mitigation Post

Mitigation StrategicEnvironmental Assessment Category Description Severit Persiste Reversibility Severity** y * nce

- Buffer zone for the blind 2.16 Traffic load in construction -1 Short- Reversible - Control of traffic route 0 work term - Avoiding or minimizing project transportation through community areas 2.17 Risk of fire hazards -1 Short- Reversible/ - Adopt fire prevention strategy 0 term Irreversible

for 2.18 Socio-impacts of -1 Short- Reversible - Local sourcing of labor 0

theMaster Plan for construction crew and term labor camps

2.19 Occupational health and -1 Short- Reversible - Management of working condition 0

130 safety concerns for term - Occupational health and safety training construction crew - Safety measures (Personal Protective

Equipment etc.) Development of 2.20 Sanitation concerns from -1 Short- Reversible - Provide means to sanitation 0 construction crew term

Others 2.21 Increase of Greenhouse -1 Short- Reversible - Management of transportation system

Gas in material transport term Mombasa SpecialEconomic Zone due to supply of materials

2.22 Loss of carbon sink from -2 Long- Reversible - Reforestation 2 destruction of natural term - Quantification and forecast of the cover vegetation and carbon storage capacity mangrove

* Only adverse impacts were extracted from the result of impact assessment in Chapter 10.These serial numbers are corresponded with ones of Table 10.2. ** Severity:- +2: Highly positive impact; +1: Some positive impact; 0: No impact; -1: Some adverse impact ; -2: Highly Adverse impact; **Reversibility and secondary impact are assessed only for the adverse impact.

EPZA: Strategic Environmental Assessment for the Master Plan for Leather Industrial park

10.6: Mitigation Measures at Operation Stage

Development of land-use zoning in the Kinanie area Towards stemming occurrence of non-planned development attracted by the Leather City at Kinanie, the Machakos County Government should immediately step in and prepare development plans for the Kinanie area so as to lay down zoning guidelines in line with the CIDP. The Zoning plans should be in place before engagement with investors at Kinanie.

Development of a Masterplan to guide water demand management in the Leather City

The EPZA is currently exploring potential sources of water supply to the LIP and has indeed sunk three boreholes on site. The impression of this study is that there is no readily available source of water at Kinanie even considering the low yield of local boreholes and the low flow condition of the Mbagathi River. The proposal is for the EPZA to team up with responsible agencies;- County Government of Machakos, TANATHI and MAVWASCO to develop a Masterplan for water Supply to the Leather Industrial City as precursor to implementation of the LIP. This could include among others, co-investment in the TANATHI sponsored Project to build addition water supply for Mavoko Township, among others.

Measures to Control Pollution

(i) Management of Liquid Effluent at Kinanie Adoption of the Kinanie Model will drastically eliminate potential for generation of contaminated liquid effluent at Kinanie and into the Athi system.

Further, every new investment will be subjected to an independent EIA study towards preparation of an ESMP specific to the investment.

Towards managing other liquid effluent, every operator will be required to pretreat effluent water to quality standards stipulated in Legal Notice 120 of EMCA for discharge into either public sewers or nature. In case any operators handling raw leather will be licensed at Kinanie, they will require to install onsite effluent treatment plants with capacity to recover all chrome and other heavy metals in addition to meeting other requirements of Legal Notice 120. So far, chrome recovery is possible but discharge of high BOD and TDS load into natural systems by Tanneries is still a major concern.

(ii) The Common Effluent Treatment Plant

Design of the Masterplan for LIP incorporates a Common Effluent Treatment Plant to serve the facility. Design of this facility should factor in proposed operations and nature of liquid effluent likely from the LIP. Operations of the CETP will be audited and regulated by NEMA and WRMA to ensure adherence to statutory standards.

(iii) Proposed sanitary landfill sites

131 EPZA: Strategic Environmental Assessment for the Master Plan for Leather Industrial park

Design of the LIP has allowed for development of a sanitary land fill to manage all solid waste in the LIP. While adoption of the Kinanie Model will greatly cut down on production of solid effluent, a sanitary land fill site is required to cater for the huge quantities anticipated from the value addition process. Precautions are recommended as follows;-

Commercial utilization of waste: The sanitary landfill site should incorporate inbuilt facilities for recovery, recycling and commercialization of the waste. Indeed, the Pilot Fertilizer Plant at Kinanie is a good step in this direction.

Need for impervious lining allowing for recovery of leachates: Given that chrome laden waste will be generated at Kinanie, there is need to install a water proof lining to the land fill site complete with measure for leachate recovery.

Application of legal Notice 121 of EMCA: Operations of the Sanitary landfill site will adhere to requirements of LN 121 of EMCA with regard to licensing and handling of specialized waste.

10.7: Summary of Mitigation Measures at Operation Stage Mitigation measures for the construction stage are summarized in Table 11.3.

132

Table10.6 Mitigation Measures for Predicted Adverse Impacts at Operation Stage

StrategicEnvironmental Assessment Category Serial* Potential Impact Mitigation Post Mitigation Description Severity * Persisten Reversibility Severity** ce

Pollution 3.1 Surface runoff and -1 Long- Irreversible - CETP installed to meet requirement of 1 control washing of pollutants term target effluent water quality for the from built up area tenants. - Septic tank installed in the residents. - To be specified by EIA 3.2 Generation of -1 Long- Irreversible Ditto 1

effluent water and term for

sewerage theMaster Pl

3.4 Increased -1 Long- Irreversible - Adoption of cleaner production systems 0 atmospheric and term - Installation of exhaust gas treatment ambient pollutants facilities

anfor - Establishment of monitoring system for

133 environmental accidents - Preparation of device to prevent the Development of

diffusion of hazard materials/oil - To prohibit and prevent the leakage of hazardous material infiltrating into the soil

The specific measures will be elaborated in Mombasa SpecialEconomic Zone theEIA /IEE to be prepared by tenants or developer as needed. 3.5 Increased solid waste -1 Long- Reversible - Reduction and recycle of waste 0 term - Proper treatment at sanitary landfill - Adoption of cleaner production systems - Proper management of hazardous waste by tenants Social 3.6 Tendency to attract -2 Long- Irreversible - Development Zoning and Control -1 - environ- the non planned term Screening of tenants ment development - Supervision by responsible authority

Category Serial* Potential Impact Mitigation Post

Mitigation StrategicEnvironmental Assessment Description Severity * Persisten Reversibility Severity** ce

- Vetting of potential investors especially on job quality 3.7 Pressure on water -2 Long- Irreversible - Develop and Implement Masterplan for 2 and other resources term water Demand Management

Others 3.8 Accidents and -2 Long- Irreversible/ - Compliance of regulation and guidance 0 hazards at facilities in term Reversible of occupational health and safety operation

(fire and explosions, for

chemical/physical theMaster Pl hazards etc)

3.9 Increase of -2 Long- Irreversible/ - Conservation of energy at LIP -1 Greenhouse Gas by term Reversible - Management of transportation system

anfor operation of facilities

134 and transportation

Development of

* Only adverse impacts were extracted from the result of impact assessment in Chapter 10.These serial numbers are corresponded with ones of Table 10.4. ** Severity +2: Highly positive impact

+1:Some positive impact

Mombasa SpecialEconomic Zone 0: No impact -1: Some adverse impact -2: Highly Adverse impact **Reversibility and secondary impact are assessed only for the adverse impact.

EPZA: Strategic Environmental Assessment for the Master Plan for Leather Industrial Park

10.8: Environmental and Social Management Plan

10.8.1: Institutional Arrangement An Institutional framework for the LIP is proposed in sections below.

It is expected that the institutional arrangement for environmental management will be provided by the EPZA as per provision of Cap 517.

- EPZA in association with other stakeholders including Kinanie residents should establish an Institutional framework to regulate operations of diverse players in the proposed LIP.

- The environmental compliance is required to all the tenants to be invited in LIP. Its criteria should be clarified in the lease contract to be made with tenants. In that regard, the internal regulation of LIP can provide the integrated standard for environmental management, if it can be specified.

- It is recommended that the Environmental Unit will establish their own monitoring system to cover entire LIP area for purposes of periodic and ambient monitoring in close consultation with NEMA.

In terms of each project-level activity, a project proponent is wholly responsible for the implementation of the project. At the pre-construction stage, a construction contractor has a role to undertake the environmental and social consideration required by EIA supervised by a project proponent. In this period, environmental and social monitoring is carried out by a construction contractor and reported to the responsible authority by a project proponent.

In the operation stage, the environmental audit system assumes the role of the environmental performance management. Monitoring will rely on standards specified by NEMA in Legal Notices 120, 121, Guidelines for ambient noise levels and Air Quality Guidelines and other sectoral standards that may be in force. In response, environmental inspectors specified by EMCA may carry out the environmental inspection for the project activities and monitor compliance with the environmental standards.

10.8.2: Management and Monitoring Framework Environmental and Social Management Plan (ESMP) outlines the measures to be taken during the subsequent project implementation. It is important for SEA for the Master Plan to ensure that the assessment result and suggestion raised here are reflected to the project-level EIA and implementation of other related plan/program/project for sustainable development of coastal area of Kenya in general and LIP in particular.

Regarding the mitigation measures discussed above, the site-specific and sector-specific measures will be developed in the EIA process for each project by the (sub-) developer or tenant who invests in LIP. Measures for site-specific impact will be planned in EIA process and elaborated in the Construction Environmental Management Plan which will be prepared for the project‘s final design. The contractor follows Environmental Management Plan and implements the

135 EPZA: Strategic Environmental Assessment for the Master Plan for Leather Industrial Park construction activities supervised by a project proponent and implementation consultant. Recommendations in the SEA should serve as a framework that guides the implementation of specific measures to ensure that sustainable and inclusive development of the LIP.

The environmental management plan for the target output and its monitoring plan are summarized in Table 10.4. The implementation of mitigation measures for the potential adverse impact are taken care by each output and associated activity as shown in Table 10.5 – Table 10.7.

136

Table 10.7: Environmental and Social Management Framework

EPZA: No. Target Management Plan Monitoring Plan

Strategic EnvironmentalAssessment Output Prepared Period Item Implementing Item of expenses Description Responsible by Organization organization

1 EIA for each Sub-project Before The result of this SEA shall be Sub-project EIA In the course of NEMA project proponent, constructio reflected to EIA. proponent, preparation cost preparation and at the developer n of each developer timing of review of EIA, project its harmonization with SEA shall be checked. 3 Environmental Contractor Before/duri The result of EIA will be Contractor ESMP Based on the EIA, the NEMA Management ng reflected. Preparation cost Construction Plan for constructio Environmental construction n Management Plan will be prepared and implemented.

for 4 Environmental Tenants During The environmental audit of all Tenant/ Environmental The requirement by EIA NEMA and

the Master for Plan Audit Report/ operation activities that are likely to have Owner of the Audit Study cost shall be put in the Environmental Annual report significant effect on the premises or the operation activity. Department of MCG environment shall be carried out. operator of a monitor the 137 project compliance of EIA and implement

regular monitoring.

6 Other related MP Not - Coordination between the Master plan Preparation of Linkage with demand of County Government Development MP such as proponent specified development of LIP and the proponent MP infrastructure or any is responsible for County other MPs other activities in LIP shall physical development development be confirmed. planning. plan

FS: Feasibility Study, DD: Detailed Design, MP: Master Plan, MCG: Machakos County Government, EPZA for Leather Industrial Park

Table 10.8 Impact to be considered in EMP at Design Stage

EPZA: Categ Serial* Potential Impact to Mitigation Output/Activity Managing the ory be Measured Mitigation measures Strategic EnvironmentalAssessment

EIA CEMP Other MPs

Natur 1.1 Minor site - Optimization of survey X - - al disturbances from method enviro survey and related nment activities stakeholder consultations, mapping work, etc for

the Master for Plan

Social 1.3 Minor accidents - Safety communication and X - -

138 enviro during survey training

nment work - Safety measures (Personal Protective Equipment etc.)

1.4 Public anxiety and - Information disclosure and X - - Development concerns over public consultation of changes in project-related plan livelihood in

for Leather Industrial Park general and resentment in particular

Categ Serial* Potential Impact to Mitigation Output/Activity Managing the

EPZA: ory be Measured Mitigation measures

Strategic EnvironmentalAssessment EIA CEMP Other MPs

Other 1.7 Concerns over - Resolution at masterplan X X XX s presence of the level sewerage - treatment plan

1.8 Interference with - Coordination with the X X the flight path other existing facilities‘ from Nairobi function

for

Jomo Kenyatta the Master for Plan Airport

139

X : The suggested mitigation measures need to be considered by XX : The suggested mitigation measures shall be fully considered by this output. this output.

Development

Table 10.6: Impact to be considered in EMP at Construction Stage Categ Seri Potential Impact Mitigation Output/Activity managing the

ory al* mitigation measures for Leather Industrial Park

EIA CEMP Other MPs

Natur 2.1 Slope destabilization in - Soil stabilization XX XX - al the Mbagathi Riparian measures enviro

Categ Seri Potential Impact Mitigation Output/Activity managing the

EPZA: ory al* mitigation measures

Strategic EnvironmentalAssessment EIA CEMP Other MPs

n- area ment 2.2 Sediment generation - Physical detention of XX XX X into Mbagathi-Athi sediments system from - Minimization of soil construction activities generation from construction work and site for

the Master for Plan 2.3 Hydrological change of - Earthworks in dry XX XX - surface/ground water season 140 due to earthworks - Securement of water channel or restoration pond for stormwater Development 2.4 Surplus soil generated - Equation of cut earth XX XX - by construction/ volume and filling

exploitation of volume for Leather Industrial Park soil/sand for landfill works

2.5 Loss of habitat for - Enhancement of XX XX - fauna compensatory conservation in in the LIP

Categ Seri Potential Impact Mitigation Output/Activity managing the

EPZA: ory al* mitigation measures

Strategic EnvironmentalAssessment EIA CEMP Other MPs

2.7 Introduction of - Screening of original XX XX - invasive/ alien species sites of material in construction materials

Polluti 2.8 Nuisances-dust, water - Adhere to OSHA XX XX X on pollution, noise and 2007 contro vibrations and odor - Optimization of for

the Master for Plan l from construction work construction device, and increase in traffic method, schedule 141 and transportation

route etc. to minimize the effect to the sensitive Development receptor 2.9 Pollution from - Development of XX XX X construction waste, waste management

for Leather Industrial Park waste oils and spares plan

Social 2.13 Displacement of - Reduce period of X X - Envir livelihoods construction onme nt 2.15 Increase in social - Rationalised access X X - tensions in the to job allocation

Categ Seri Potential Impact Mitigation Output/Activity managing the

EPZA: ory al* mitigation measures

Strategic EnvironmentalAssessment EIA CEMP Other MPs

community due to influx of outsiders

2.16 Disturbance to village - Minimize period of X X - life, such as access to disturbance primary education and other existing infrastructure due to for

the Master for Plan construction activity

142 2.18 Pressure on water - Develop Masterplan X X XX

resources and supply for water demand management

2.2 Alteration of the - Identification and XX XX - Development 3 physical landscape prevention of aesthetic area -

for Leather Industrial Park 2.2 Traffic load in - Control of traffic XX XX X 4 construction work route - Avoiding or minimizing project transportation through community areas

Categ Seri Potential Impact Mitigation Output/Activity managing the

EPZA: ory al* mitigation measures

Strategic EnvironmentalAssessment EIA CEMP Other MPs

2.2 Risk of fire hazards - Adopt fire XX XX - 5 prevention strategy

2.2 Socio-impacts of - Local sourcing of XX XX - 6 construction crew and labor labor camps

2.2 Occupational health - Management of XX XX X for 7 and safety concerns for working condition the Master for Plan construction crew - Occupational health

143 and safety training

- Safety measures (Personal Protective

Equipment etc.) Development 2.2 Sanitation concerns - Provide means to XX XX - 8 from construction crew sanitation

Other 2.2 Increase of Greenhouse - Management of XX XX - for Leather Industrial Park s 9 Gas in material transportation transport due to system supply of materials

2.3 Loss of carbon sink - Reforestation XX XX - 0 from destruction of - Quantification and

natural cover forecast of the

Categ Seri Potential Impact Mitigation Output/Activity managing the

EPZA: ory al* mitigation measures

Strategic EnvironmentalAssessment EIA CEMP Other MPs

vegetation carbon storage capacity

X : The suggested mitigation measures need to be considered by XX : The suggested mitigation measures shall be fully considered by this output. this output.

* Only adverse impacts were extracted from the result of impact assessment in Chapter 10.These serial numbers are corresponded with ones of Table 10.2. for

** In this table, these abbreviations stand for the name of outputs indicated in Table 1 as follows the Master for Plan EIA: EIA for each project, CEMP: Construction Environmental Management Plan, EAR: Environmental Audit Report, Other MPs: Other related MP such as County development plan

144

Development

for Leather Industrial Park

Table 010.9 Impact to be considered in EMP at Operation Stage

EPZA:

Strategic EnvironmentalAssessment Categ Seri Potential Impact Mitigation Output/Activity managing the mitigation ory al* measures

EIA ESMP EAR Other MPs

Natur 3.1 Degradation of - Integrated measures XX - XX - al ecological systems and composed of conservation enviro biodiversity of mangrove forest,

nment pollution control of basin for

area etc. the Master for Plan Polluti 3.2 Surface runoff and - Wastewater treatment XX - XX - on washing of pollutants facilities installed to meet

145 contro from built up area requirement of target

l effluent water quality for

the tenants. Development - Septic tank installed in the residents. - To be specified byEIA /IEE

3.3 Generation of effluent Ditto XX - XX - for Leather Industrial Park water and sewerage

3.4 Potential for marine - Establishment of monitoring XX - XX - disasters including system for environmental marine pollution accidents - Preparation of device to

prevent the diffusion of

Categ Seri Potential Impact Mitigation Output/Activity managing the mitigation

EPZA: ory al* measures

Strategic EnvironmentalAssessment EIA ESMP EAR Other MPs

hazard materials/oil 3.5 Increased atmospheric - Adoption of cleaner XX - XX - pollutants production systems - Installation of exhaust gas treatment facilities 3.6 Increased solid waste - Reduction and recycle of XX - XX -

waste for

- Proper treatment at landfill the Master for Plan - Adoption of cleaner production systems

146 - Proper management of

hazardous waste by tenants

Social 3.7 Tendency to attract - Screening of tenants X - - XX Development enviro non planned - Supervision by responsible nment development authority

3.8 Pressure on water and - Develop and Implement X - X XX for Leather Industrial Park other resources Masterplan for water Demand management Other 3.9 Accidents and hazards - Compliance of regulation X - XX - s at facilities in operation and guidance of (fire and explosions, occupational health and chemical/physical safety

Categ Seri Potential Impact Mitigation Output/Activity managing the mitigation

EPZA: ory al* measures

Strategic EnvironmentalAssessment EIA ESMP EAR Other MPs

hazards etc)

3.10 Increase of Greenhouse - Conservation of energy at X - XX - Gas by operation of SEZ facilities and - Management of transportation transportation system

X : The suggested mitigation measures need to be considered by XX : The suggested mitigation measures shall be fully considered by this output.for this output. the Master for Plan

147

Development

for Leather Industrial Park

Reporting The following reports are supposed to be developed in the course of implementation of each project activity.

(i) EIA Reports under EMCA 1999: Each project will be subjected to EIA process as required by EMCA and develop Environmental and Social Management Plan to guide resolution of project specific impacts. NEMA will grant Environment Licenses based on this Report.

(ii) Minutes or Record of Periodical Site Meetings: The construction site shall be checked its environmental and safety performance periodically. Following every site checking and meeting, minutes of deliberations will be produced, reported and adopted as a basis for following up on contractor‘s activity.

(iii) Annual Audit Reports: Each project licensed by NEMA will be subjected to an annual environmental audit in line with EMCA 1999. The report will include a summary of the environmental performance of the facility/enterprise vis-a-vis the Environmental Management Plan prepared and a synthesized with newly-raised emergent concerns.

Recommendations for Environmental and Social Management

Adaptive Management In addition to environmental changes over time, the Development of LIP will trigger significant socio-economic changes in the Kinanie area. By 2030, the whole area will be urbanized and agriculture will no longer be the dominant livelihood practice. The Environmental and Social Management Plan above is based on the current situation as analyzed in this SEA study; however, current expectations to the Masterplan and result of the SEA study could become obsolete or unrealistic depending on the nature and magnitude of the economic, social and environmental transformation as well as the changes in the aspiration of the stakeholders. As such, the ESMP will have to be revised and updated periodically to ensure that the goal and the approach to environmental management is aligned to the concerns, interests and aspirations of the stakeholders.

Therefore, it is recommended to take an adaptive management process to allow for continuous updating and improvement of the initial environmental and management plan. An adaptive management plan is the systematic process involving the review of plan, monitoring and assessment of progress, incorporating lessons learned and reflecting them to the existing plan (Figure 10.1). In this process, the key element is to set a goal for the final outcome. For example, when the site-specific management plan is prepared in the future, it is expected that the plan sets a goal against which the stakeholders will prepare the management and monitoring mechanism for sustainable development. This can be updated periodically by the monitoring and evaluation scheme so that the plan will be flexible and responsive to the changing concerns and aspirations of the stakeholders (e.g. local community).

EPZA: Set Initial Environmental and Social Management Plan

Strategic EnvironmentalAssessment

- Goal/Objectives - Criteria - Monitoring Plan

Periodic Monitoring

Review and Assessment Changes in

Environmental and social setting/ for Revising of Environmental and Social

And expectations the Master for Plan Management Plan

149

Development Figure 0.1 Adaptive Management Process

for Leather Industrial Park

EPZA:

Strategic EnvironmentalAssessment

for

the Master for Plan

150

Development

for Leather Industrial Park