Ajabu Africa News

By:

Standard Reporter

Posted:

Nov,16-2016 21:12:31

NAIROBI, KENYA: Kenya has moved up 21 places in the World Bank's ease of doing business, as the country made its maiden entry into the top hundred category.

It is a huge achievement for the Jubilee administration which has been keen to improve the business environment, and thus gain some bragging rights as country heads to the general elections next year. Kenya moved to position 92 having put in place regulations that made it easier for small investors in Nairobi to start business, get electricity, register property, protect minority investors and resolve insolvency.

Kenya's largest improvement came in the areas of resolving insolvency after it enacted the Insolvency Act 2016.

The country moved up 44 places in this parameter. The Companies Act 2016 which makes it easier for minority shareholder to sue the company made the country to move up 25 places on the index of protecting minority shareholders.

It is also easier to start a business with entrepreneurs taking on average 22 days to start a business. Kenya moved up 34 places on the ease of starting a business, with the government scrapping stamp duty fees for the nominal capital, memorandum and articles of association.

Getting electricity went up by 21 places and protecting minority investors went up by 25 places.

The reforms also saw the country bag prize of the third most reformed country in the world for the second year in a row.

Indeed, although Mauritius, Rwanda, Botswana, South Africa were perched ahead of Kenya in the log, only Kenya made it to the top ten most reformed countries in the World among the Sub-Saharan African countries.

"We have had good days in the past. But we slipped, and we somehow lost the glory that we once enjoyed in the last seven years. And I think we have now turned the corner," said the Cabinet Secretary Ministry of Industry, Trade and Co-operatives Adan Mohamed.

"We have climbed 44 places over two years to get from 136th in 2014 to 92nd this year," said Mohamed.

In addition to the five parameters that Kenya improved on, the survey also looks at ease of paying taxes, getting credit, dealing with construction permits, trading across borders and enforcing contracts.

Kenyans also continue to be bogged down by the laborious process of paying taxes, even though the Kenya Revenue Authority (KRA) introduced the i-Tax system.

Kenya moved down three places on paying taxes continue to be frustrating for Kenyans after the country slipped down further three places. The country also underperformed on enforcing of contracts where it moved down two places, and getting credit where the enactment of the law capping interest rate saw it slide down two places.

Kenya private sector alliance (KEPSA) CEO Carol Kariuki said the results were a "true reflections of tremendous reforms we (the private sector) have pushed."

But the ordinary mwananchi with a small kiosk will be left wondering how they will benefit from the many reforms the Government has undertaken.

Last Month, the Kenya National Bureau of Statistics (KNBS) released a survey showing that thousands of micro, small and medium enterprises (MSMEs) are grappling with the protracted process of licensing their businesses.

MSMEs have also struggled to access credit, with most of them choosing to use family cash to start their own businesses.

Critics are likely to bash the report for its failure to incorporate such issues as corruption into the survey. And for a country that has some of the finest laws on the continent, but has had difficulty implementing them, it will be interesting to see the practicality of these reforms.

The report also concentrates on the capital city Nairobi, as opposed to other cities and towns, even as devolution takes center stage.

The report also introduce gender aspect for the first time, looking at how regulations introduced by the 190 countries surveyed are discriminating against women getting business.

"In Sub-Saharan Africa, 18 economies stipulate additional hurdles for women entrepreneurs. For example, six economies including Benin, Cameroon, DRC, and Guinea-Bissau, make starting a business more difficult for women compared with men. I truly hope that such insights will shed light to more regulations that are in need of reforming to give equal opportunity for all across the region," Oumar Seydi, IFC Director for East and Southern Africa.

Source:

Standard Digital