Kenya Is Bad For Business: Why Businesses Never Take Off

By Juma / September 2, 2020 | 7:24 am



daily interest investment

Kenya is unfriendly for business. It is not welcoming for any new investor. Simply put, Kenya is bad for business and only favors those with deep pockets.

It is very difficult to set up and run a business in Kenya at the moment. In most cases, the business will die even before it takes off.

The cost of doing business in this country is among the highest compared to other East African countries. This is the reason why investors are taking off to other countries such as Rwanda and Uganda.

Before the advent of Covid-19, at least 450,000 small and medium enterprises (SMEs) were shutting down businesses annually. That translated to 30,000 monthly and at least 1,000 daily. With the coming of Covid-19, the numbers are even higher.

Covid-19 has complicated the business environment in Kenya even further. Millions of businesses have shut down with the most affected being hotels, bars, and restaurants, among others. Millions of Kenyans have lost their jobs too.

The government, through President Uhuru Kenyatta, has always promised to have the interests of investments and businesses at heart but the more they say it, the more they kill them.

We can never run away from the fact that SME is the engine of Kenya’s economy. The sector employs 86 percent of Kenyans and contributes at least 45.5 percent to Kenya’s gross domestic product (GDP).

Government policies in Kenya are the number one killers of businesses in Kenya. To set up a simple business like a water refilling station will leave you frustrated, tired, and with no hope to continue.

Let us say you want to set up a water refill and packaging station, here is what you will need to kick off:

County single permit license at 18,500 shillings

Public health license and testing at 13,000 shillings

KEBS certification at 102,000 shillings

KRA Custom excise license at 50,000 shillings

KRA Custom excise bond at 300,000 shillings

KRA custom excise stamp minimum at 50,000 shillings

License from NEMA at 33,000 shillings

Mandatory independent lab testing and MOU at 15,000 shillings

These are the costs that one will need to pay before even thinking of the machinery to package the water, employees, energy, and other running costs.

Let us say you have the financial muscles to pay the required costs, struggle to make your water business take off. The same government will pounce on you like a cheetah slapping you with 0.5 percent of everything you sell at the end of every month.

You will also be required to pay at least 5.75 shillings on every bottle of water you sell (per liter). Also, there is a distribution license that you will need from your county. Some counties charge as much as 50,000 shillings.

With 1,000,000 shillings in Kenya right now, thinking of starting a business is like placing your money in a bet. The most worrying thing is 80 percent of it will go to the government before your business even starts to operate.

Comparing to Kenya, the cost of doing business in Rwanda is a third that is being slapped to businesses in Kenya. In Rwanda, in fact, most investors are allocated free land and given tax vacations just to kick off a business and employ the locals.

Kenya needs an overhaul.

READ: Is Investing In Real Estate Still A Good Idea?





About Juma

Juma is an enthusiastic journalist who believes that journalism has power to change the world either negatively or positively depending on how one uses it.(020) 528 0222 or Email: info@sokodirectory.com

View other posts by Juma


More Articles From This Author







Trending Stories










Other Related Articles










SOKO DIRECTORY & FINANCIAL GUIDE



ARCHIVES

2020
  • January 2020 (272)
  • February 2020 (310)
  • March 2020 (390)
  • April 2020 (321)
  • May 2020 (335)
  • June 2020 (327)
  • July 2020 (334)
  • August 2020 (276)
  • September 2020 (214)
  • October 2020 (185)
  • 2019
  • January 2019 (253)
  • February 2019 (216)
  • March 2019 (285)
  • April 2019 (254)
  • May 2019 (272)
  • June 2019 (251)
  • July 2019 (338)
  • August 2019 (293)
  • September 2019 (306)
  • October 2019 (313)
  • November 2019 (362)
  • December 2019 (319)
  • 2018
  • January 2018 (291)
  • February 2018 (213)
  • March 2018 (278)
  • April 2018 (225)
  • May 2018 (238)
  • June 2018 (178)
  • July 2018 (256)
  • August 2018 (249)
  • September 2018 (256)
  • October 2018 (287)
  • November 2018 (284)
  • December 2018 (185)
  • 2017
  • January 2017 (183)
  • February 2017 (194)
  • March 2017 (207)
  • April 2017 (104)
  • May 2017 (169)
  • June 2017 (205)
  • July 2017 (190)
  • August 2017 (195)
  • September 2017 (186)
  • October 2017 (235)
  • November 2017 (253)
  • December 2017 (266)
  • 2016
  • January 2016 (165)
  • February 2016 (165)
  • March 2016 (190)
  • April 2016 (143)
  • May 2016 (245)
  • June 2016 (182)
  • July 2016 (271)
  • August 2016 (248)
  • September 2016 (234)
  • October 2016 (191)
  • November 2016 (243)
  • December 2016 (153)
  • 2015
  • January 2015 (1)
  • February 2015 (4)
  • March 2015 (166)
  • April 2015 (108)
  • May 2015 (116)
  • June 2015 (120)
  • July 2015 (148)
  • August 2015 (157)
  • September 2015 (188)
  • October 2015 (169)
  • November 2015 (173)
  • December 2015 (207)
  • 2014
  • March 2014 (2)
  • 2013
  • March 2013 (10)
  • June 2013 (1)
  • 2012
  • March 2012 (7)
  • April 2012 (15)
  • May 2012 (1)
  • July 2012 (1)
  • August 2012 (4)
  • October 2012 (2)
  • November 2012 (2)
  • December 2012 (1)
  • 2011
    2010
    2009
    2008
    2007
    2006
    2005
    2004
    2003
    2002
    2001
    2000
    1999
    1998
    1997
    1996
    1995
    1994
    1993
    1992
    1991
    1990
    1989
    1988
    1987
    1986
    1985
    1984
    1983
    1982
    1981
    1980
    1979
    1978
    1977
    1976
    1975
    1974
    1973
    1972
    1971
    1970
    1969
    1968
    1967
    1966
    1965
    1964
    1963
    1962
    1961
    1960
    1959
    1958
    1957
    1956
    1955
    1954
    1953
    1952
    1951
    1950