|State drafts policy to stop massive capital flight|
|Written by George Omondi|
The joint initiative between the Kenya Investment Authority (KIA) and Treasury aims at restoring the country's lost glory as an investment hub in the region.
KIA managing director Susan Kikwai says a blueprint that will be unveiled for public scrutiny soon outlines the country's resources and opportunities available for investment. "Kenya has a well trained manpower and this is one of our strengths as an investment destination ," she said.
The policy, which also enjoins local authorities and regional development authorities in marketing Kenya as an investment destination, is expected to drive the government's medium term plan (MTP) aimed at increasing GDP growth to between 7.9 and 8.7 per cent in 2009 to 2010 and finally to 10 per cent by 2012.
Ms Kikwai said the authority had designed an Investment Product Development and Marketing (IPDM) programme towards this end. Of late, the country has experienced massive exit of companies citing a steep investment landscape in the country.
Only last year, Reckitt Benckiser, the global home and personal care giant, was forced to scale down its operations in the country, in the process sacking 37 permanent factory workers and several casual labourers at its Nairobi base.
The high cost of production, poor infrastructure, expensive power and communication, and poor enforcement of intellectual property rights have continued to push Kenya's manufacturing community to Egypt and Asia.
Even the country's protected industrial conclave, EPZs, are facing rough times with statistics indicating that over 14 factories have closed down in the country since 2005.
At the moment, local manufacturers have to contend with high electricity tariffs that translate to 20 US cents per kilowatt hour compared to Egypt's eight or South Africa's14.
New LawsThey have also called on the government to shelve new labour laws which they say come with too much welfare costs that could put more pressure on the already high wages.
"Our aim is to enhance our advocacy role to ensure that the investment community gets a favourable environment for conducting their business," said Ms Kikwai. The authority, which has also been working with Treasury in licensing reforms, is set to launch e-registry where at a click of a button, a foreign investor will be able to know all the licences required of their business types.
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