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Why Kenya remains best destination for foreign investment

Demonstrators during a rally in front of the office of South African television firm DStv, on Monday in Abuja to protest against anti-immigrant violence in South Africa. PHOTO | AFP
Demonstrators during a rally in front of the office of South African television firm DStv, on Monday in Abuja to protest against anti-immigrant violence in South Africa. PHOTO | AFP 

Attention investors the world over. Disillusioned with the Republic of South Africa regarding your fear for your foreign workforce? Disturbed by slow political responses to citizens’ issues? Might you examine a noble proposition: invest in Kenya.

Relocating to a new country fills someone with the excitement of new possibilities as well as fears of acceptance, bureaucracy, and safety.

A lovely diverse country with a resilient people, South Africa earns more from its business interests abroad than from foreign businesses repatriating funds.

However, large swaths of citizens still blame foreigners instead of thanking them. While various perplexing paradoxes exist in every nation, Kenya does not juxtapose its citizens against foreigners.

Kenyans widely know our export prowess in the East Africa region and enjoy the gains brought by our relative geographic hegemony.

Avid travellers know our decades-long pro-foreigner stance politically, commercially, and personally. Kenyans would rather learn best practices from foreigners, benefit from their investment, utilise their connections, Kenyanise them, and turn them into missionaries promoting brand Kenya around the globe.

A Kenyan is more likely to feel pride that a foreigner chooses our nation as a home rather than to feel disdain at their presence.

Apart from the high profile attacks by a few terrorist elements, Kenya grows arguably safer each year. Kenya can promise a swifter police response to disturbances, quick political attention to outbursts, and an outpouring of citizen support during and after crises.

Kenya boasts one of the fastest growing GDPs, highest financial securities returns, and best real estate markets in the world.

We hold a vibrant civil society, a global hub for best practices in accounting, debatably the most innovative tech sector in the developing world, and an exceptionally educated populace.

Like South Africa, our arts and media space grows with increasing quality. Our artists, poets, singers, and painters thrive and represent a real meaningful venue for those who challenge the status quo.

Apart from South Africa’s very own Trevor Noah, Kenyans would argue that we have the wittiest comedians, the uncanny ability to laugh out ourselves without offence, and the best sense of humour anywhere bar none.

In Kenya we laugh all day and still get our work done with high productivity rates.

Kenya offers comparatively low capital gain taxes, market friendly generally pro-competition capitalist policies, and allows foreign investment in securities and land with only nominal yet reasonable protections to aid native Kenyans.

Sure we struggle with major issues of tribal bias, systemic corruption, and insecurity from unstable neighbour states. Foreigners do report a dramatic increase in harassment during work permit applications.

However, one must realise that when a system tightens from previously dishing out permits too loosely, growing pains are bound to exist and a pendulum typically swings too far to the opposite side before landing somewhere more reasonably in the middle with a sensible approach.

If investors desire residency along with investment, Kenya stands to improve with some of the most restrictive investor rules.

While new practices dictate a Sh50 million investment gets someone a two-year residency permit, meanwhile a Sh46 million equivalent investment in the US, much of the European Union, and Canada gets an investor permanent residency fast tracked for actual citizenship.

What does a nation gain from liberal immigration policies for skilled labourers? A nation like South Africa or Kenya gains from better links to the global economy.

A foreign worker typically retains his or her ties with home nations. Such linkages help in exchanges, new investment money, and new customer bases.

Kenyan workers get to learn best practices from around the world while the foreign workers learn Kenyan best practices to transplant back home to strengthen bonds.

Pro-foreigner policies enable Kenya to receive over Sh303 billion in foreign official development assistance annually, the equivalent of 26 per cent of all Government of Kenya revenues.

A further Sh48 billion comes from foreign investors in large part to Kenya’s pro-foreigner policies.

Such favourable Kenyan strategies make Nairobi the go-to destination for regional or continental hubs for nearly every global business and NGO, much to the chagrin of Dar es Salaam, Kigali, Addis Ababa, Juba, Bujumbura, and Kampala.

Investors and donors feel comfortable if their own citizens accustomed to certain practices and standards can represent even just a fraction of the workforce.

If an investor, however, desires the majority of its workforce in Kenya to comprise its own citizens, then Kenya only negligibly benefits and sensible government action should and does step in to stop such scenarios.

Kenya should avoid the passive aggressive American methodology in dealing with immigration with different official versus unofficial policies compared to actual practices on skilled and unskilled foreign workers.

America famously employed a reactionary policy by President George W Bush following the 2001 attacks. A clamp down on foreign skilled labourers damaged Silicon Valley and other high technology-dependent hubs.

Even in a typical cutting-edge United States medical research laboratory, such as the Wake Forest Institute for Regenerative Medicine, retains more than 50 nationalities on its team to engage with the best and brightest among all humankind.

In Kenya, we have always embraced such a philosophy. While nearly 100,000 Kenyans live in the United States, roughly 10,000 Americans choose Kenya as their home.

Diversity makes us better. We have learned so much from the Rainbow Nation. But investors consider Kenya because now is the time to invest here. Come build our nation. We will respect you. We ask for respect and partnership in return.

Come boost our rapidly growing and highly educated middle class while enjoying our superb eateries, hotels, culture, and estates.

Discuss investor tips with other Business Daily readers on Twitter through #InvestInKenya.

Prof Scott serves as the director of the New Economy Venture Accelerator (NEVA) at USIU’s Chandaria School of Business, www.ScottProfessor.com, and may be reached on: [email protected] or follow on Twitter: @ScottProfessor.

In next week’s edition of Business Talk, we explore “How to Approach a Job Search”. Read current and prior Business Talk articles on the Business Daily’s website and www.usiu.ac.ke/blog/businessdaily.

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