Rwanda and Kenya were the only economies in the region to record improvements in the Ease of Doing Business Index released last week, as new laws, inability to repatriate funds, and business registration saw the other countries fall in their ranking. Kigali had the biggest jump, improving 15 places from last year's rank 56 to rank 41, followed by Nairobi, whose attractiveness to investors improved 12 places, buoyed by improvements in regulations for starting a business, trading across borders, getting electricity, access to credit and the payments of taxes. However, slow registration of property and issuance of construction permits remain the biggest hurdles to ease of business. Since the start of Ease of Doing Business Index ranking 15 years ago, Rwanda has implemented the most reforms at 52, followed by Kenya at 32 and Mauritius at 31. Kenya's Trade and Industry Cabinet Secretary Adan Mohamed said that Kenya was happy with the ranking, adding that the country would strive to involve the private sector. "This is the country's best performance in 15 years and reflects continuous improvement, which is a good indicator for international investors. It will now help us attract more investments into the country. Last year, we delivered the highest number of business-related reforms on the continent," Mr Mohammed said. Kenya According to the report, Kenya made starting a business easier by removing stamp duty fees required for the nominal capital, and memorandum and articles of association. The country also did away with requirements to sign compliance declarations...

Stakeholders in the transport sector have warned that sustained anxiety resulting from the long electioneering period in Kenya might have devastating effects on Mombasa port’s performance and the Northern Corridor. Data from the Kenya Ports Authority (KPA) indicate that although imports have been flowing into the harbour normally, off-take of cargo has slowed down during the period. “The imports are normal but the challenge has been experienced in picking up the goods,” said Mr Bernard Osero, KPA head of corporate affairs. Former Kenya Transporters Association (KTA) chief executive Alfayo Otuke said most transporters had withdrawn their trucks from the roads, fearing for their safety, especially after the opposition boycotted the presidential election rerun. While normally more than 3,000 trucks ply the northern corridor route each day, the number has reduced to less than 2,000, said Mr Otuke. The corridor is the artery that feeds landlocked countries of Uganda, Rwanda, Burundi South Sudan and Democratic Republic of Congo with goods imported through Mombasa, and disruption of the route as witnessed when Nasa supporters protested immediately after the August elections and before the repeat presidential poll, disrupt delivery of cargo. Becoming risky Lately, Rwanda, Burundi and DRC have turned to the Central Corridor that runs from Dar-es-salaam port. “The northern corridor is becoming risky for transporters who fear to lose their investments and have withdrawn their vehicles from the roads. They have cut down on the fleet that they are operating because of the political uncertainty,” Mr Otuke, who was the CEO...

The Kenya Association of Manufacturers (KAM) and the TradeMark Africa (TMA) said the centralized business portal will provide industry stakeholders and potential investors with information on economic and legal environment, industrial and trade statistics relevant to the manufacturing sector and its sub sectors. KAM Chairperson Flora Mutahi said in a statement on Friday that the information shared through the portal will provide investors with the necessary data needed to map out areas of investment and potential sectors for businesses to scale into. "Kenya moved a notch higher in e-commerce following the recent launch of the devolution portal which seeks to provide an interactive platform for information sharing between the business membership organizations, county governments and constitutional implementation bodies," Mutahi said. She said another key milestone for industry has been the launch of the new National E-Trade Portal - a national e-commerce gateway. The portal launched by KAM is part of the wider efforts to integrate the use of technology in the manufacturing sector in line with economic goals towards Vision 2030. "It will increase the sector’s investment competitiveness by providing necessary data needed for investment and ultimately, the growth of the sector," said Mutahi. Ministry of Information, Communication and Technology, State Department of ICT and Innovation Principal Secretary Victor Kyalo noted that the ICT sector is envisaged to transform Kenya into knowledge and information based economy. Kyalo said the ICT sector is the catalyst for competitive and dynamic economies, adding that Kenya is considered the leading technology and innovation hub...

Last week the World Bank’s Ease of Doing Business Report revealed that Kenya’s standing had improved by 12 places. It is now ranked 80 among 190 economies and is the top improver in Africa. The last time Kenya was ranked this highly was in 2008 when the country stood at number 84. It is now the third highest in Africa with only Mauritius and Rwanda higher at 49th and 56th place respectively. The report says the improvement was credited to five reforms in the areas of starting a business, obtaining access to electricity, registering property, protecting minority investors and resolving insolvency. These improvements are important for several reasons the first of which is that the report is an important signaller for investors, particularly foreign investors. Improvements in ranking are positive signals for foreign investors in particular. Some may argue that the report makes no difference to the ordinary Kenyan but the truth is that SMEs and informal businesses are tethered to larger businesses who often seek foreign investors. Thus an indication that the investment climate has improved bolsters investment opportunities for large formal businesses who can pass business on to SMEs and informal businesses as suppliers, distributors or service providers. The report is important because it gives an indication of how easy it is to start and run a formal business in Kenya. The easier it is to start and run a formal business in Kenya, the higher the chances are that informal businesses may take the path toward formalisation....

The Kenya Association of Manufacturers (KAM) and the TradeMark Africa (TMA) said the centralized business portal will provide industry stakeholders and potential investors with information on economic and legal environment, industrial and trade statistics relevant to the manufacturing sector and its sub sectors. KAM Chairperson Flora Mutahi said in a statement on Friday that the information shared through the portal will provide investors with the necessary data needed to map out areas of investment and potential sectors for businesses to scale into. “Kenya moved a notch higher in e-commerce following the recent launch of the devolution portal which seeks to provide an interactive platform for information sharing between the business membership organizations, county governments and constitutional implementation bodies,” Mutahi said. She said another key milestone for industry has been the launch of the new National E-Trade Portal – a national e-commerce gateway. The portal launched by KAM is part of the wider efforts to integrate the use of technology in the manufacturing sector in line with economic goals towards Vision 2030. “It will increase the sector’s investment competitiveness by providing necessary data needed for investment and ultimately, the growth of the sector,” said Mutahi. Ministry of Information, Communication and Technology, State Department of ICT and Innovation Principal Secretary Victor Kyalo noted that the ICT sector is envisaged to transform Kenya into knowledge and information based economy. Kyalo said the ICT sector is the catalyst for competitive and dynamic economies, adding that Kenya is considered the leading technology and innovation hub...

An enlightening Kenyan proverb says: a man stung by a bee does not destroy all the beehives. Kenyan politicians need to take a cue from this ancient wisdom. In their unrelenting efforts to deprecate each other, President Uhuru Kenyatta’s Jubilee Party misused the legislative body and coerced the highest institute of justice rendering it subservient which let a highly questionable re-election go ahead. His arch political rival, Raila Odinga continues to be adamant in his efforts to be the first citizen and is considered to be equally responsible in severely maligning the geo-political goodwill and socio-economic confidence that Kenya has so painstakingly earned to become a regional powerhouse. Opposition leader Odinga’s call for the boycott of products manufactured by companies controlled by hardliners associated with President Kenyatta sends out a wrong signal within business circles. It projects Kenya to be a country at war with itself. When Kenya falters, its ramifications create an imbalance in the East-African region in several ways. Trade wars could escalate, which neighbouring Tanzania is quite keen on but unable to initiate because Kenya is the pivotal regional economic powerhouse. Inland members of the East African Community (EAC) namely Uganda, Burundi, South Sudan and Rwanda would face trade and industry challenges since they are highly dependent on the Kenyan sea-port in Mombasa for its supply of consumer products and the import of industrial raw materials. The Ugandan economy registered a sluggish first quarter. “We are more concerned with events in Kenya which is a key trade...

For the typical entrepreneur, profit is the main motive. This, after all, is the presumed reward for taking on risk. The bottom-line often keeps executives awake at night. Progressively growing profits and keeping shareholders happy with handsome dividend payouts is the ultimate measure of how the business is doing and, by extension, how effective the leadership is. This is the way we have always looked at and evaluated business. Not anymore. PROFIT Profit, on its own, no longer offers an accurate measure of the success of today’s business. It is an insufficient measure that does not give the full picture of the state of a business. Impact is actually the new measure of success. Focusing only on profit without considering a business’ positive impact is outdated. The true measure of the success of a business is its impact on the wellbeing of people and the planet. Wellbeing is the ultimate measure of success. Social and environmental impact can no longer be ignored. The business model of the future is one that is keen on not only maximising profit, but also positive impact that benefits people and the planet. Business has to take the lead in prioritising an inclusive economy, where enterprise plays a role in promoting the greater good, broadening prosperity and tackling inequality. In the business environment today, massive prosperity and technological innovation notwithstanding, globalisation continues to intensify, leading to complex global issues that have negatively affected society. SOCIAL ILLS This ranges from massive environmental depletion and degradation due...

Experts from 14 regional countries including Rwanda will this week deliberate on how they can consolidate the strong performance of the region while ensuring the economic transformation needed to reduce poverty and achieve the Sustainable Development Goals. This will be during the Intergovernmental Committee of Experts (ICE) which meets in Moroni, Comoros, next week. It is organized by the United Nations Economic Commission for Africa (ECA) in partnership with the government of Comoros. “This will constitute an excellent opportunity for experts from the region to discuss some of the major bottlenecks and catalysts for growth,” said Andrew Mold, the acting director of the ECA sub-regional office in Eastern Africa. “There is also a special session dedicated to discussing the development trajectory of the host country, during which ECA’s Comoros profile will be presented. The session will focus on the country’s long-term growth strategy, and opportunities in the tourism and energy sectors.” According to the Commission, the growth rate of Eastern African countries has been among the fastest in the world in recent years, averaging 6.8 per cent between 2012 and 2015. However, it is noted that in 2016 and 2017, the regional growth rate declined to 5.6 per cent. The evolution of per capita income growth has reportedly been much more modest while instability has increased, and the meeting will focus on different sectors that constitute either catalysts or constraints to growth and structural transformation. It is noted that the expansion of the tourism sector, the vast potential of the...

President Paul Kagame has said that regional integration and close partnership between members of regional economic communities can fast-track development and prosperity for individual nations. Kagame was yesterday speaking at the Global Business Forum on Africa held in Dubai, United Arab Emirates. The session was moderated by John Defterios, the emerging Markets anchor at CNN UAE. The Head of State noted that regional integration in Africa would enable countries to get past divisions that have long prevented the continent from being as prosperous at it should. Citing the example of the East Africa Community integration, Kagame said the initiative has yielded positive impacts such as free movement of people, customs union and joint infrastructure projects. “If you look at the East African region, even more progress has been realised, for example, in the area of customs union, integration in the area of infrastructure that bring the countries of the East African Community together, whether it is telecommunication in the area of realising one area network, where there are no roaming charges,” Kagame said. Other impacts, he noted, include working together to implement reforms that cover aspects such as the economy and security that’s necessary. EAC integration has, among others, seen the liberalisation of free movement of people, goods and services, consequently increasing opportunities for the over 160 million citizens of the bloc. Four countries in the bloc (Kenya, Uganda, Rwanda and South Sudan) in 2014 rolled out the One Area Network, scrapping calls roaming rates which brought down the cost of...

On October 12th the New York Times brought the discussion of second hand clothing in East Africa to the mainstream. Unbeknownst to most in North America, the United States trades millions of dollars worth of used clothing to East African countries essentially tax free. African countries export duty free products to the United States in return. The bilateral trade agreement that makes this transaction possible, the African Growth Opportunity Act (AGOA), is the center of a controversy roiling African-US trade relations. Six East African countries (EACs) created a pact in Spring of 2017 that would increase tariffs on imported used clothing from the US with the eventual goal of an outright ban by 2019. By June, a US lobby, the Secondary Materials and Recycled Textiles Association (SMART), filed a petition with the United States government against limiting clothing imports. The grounds for this petition were that a ban on used clothing would induce disastrous economic effects for tens of thousands of American jobs as well as potentially violate the terms of the AGOA. The United States Trade Representative initiated an “out-of-cycle” review of three out of six countries – Rwanda, Tanzania, and Uganda – to assess the allegations made by SMART on June 20th. Rwandan President Paul Kagame and Finance Minister Claver Gatete fiercely defend the used clothing ban despite threats of sanctions from the United States. The goal, according to the finance minister, is to increase local production and “minimize the health risks that come with the used product”. Kagame also doubled down on...