President William Ruto has in a span of three weeks moved to woo investors from the United States and Europe and within the continent in his bid to expand the economy.
The president has identified foreign investment as key in his flagship plan of growing the economy and creating job
After a recent tour of Germany and Belgium, Ruto returned home to meet US businesspeople at the American Chamber of Commerce Regional Business Summit at a Nairobi hotel.A week later he set out for neighbouring Rwanda where he inked a raft of deals to boost trade between the two countries.During the recent US-Kenyan trade summit, Ruto underscored his administration’s commitment to transforming the economy by creating a business-friendly environmen
Prior to the meeting, he revealed that he had held a virtual meeting with US President Joe Biden and other world leaders at the Democracy Summit in South Korea where he emphasised Kenya’s commitment to constitutionalism, the rule of law and respect for institution
Limited acce
The pitch was important since previously, US investors had expressed concern that endemic corruption in the country was denying them opportunities to do business despite being qualifie
In 2021, for instance, the US Trade Representative’s Office reported that the country’s firms had experienced limited success bidding on government tenders in Kenya since widespread corruption often influences the outcome, leading to numerous court challenges
“Foreign firms, some without proven track records, have won government contracts when partnered with well-connected Kenyan firms,” it sai
Despite the government migrating public procurement to the Integrated Financial Management Information System the US agency still held that the system had security gaps that make it vulnerable to manipulation, including the duplication of authorised users’ identities and non-users’ ability to remotely gain acces
Building on the momentum built by the former regime, Ruto outlined the government’s resolve to transform the economy by creating a business-friendly environment
“Under our plan (bottom-up agenda), we are building the blocks to create wealth; we are already creating jobs and attracting local and foreign investors,” he sai
The president identified transforming agro-industrial productivity and food security; universal health coverage, including the production of medical commodities and biomedical supplies; the digital superhighway and last-mile fibre-optic infrastructure; the micro, small and medium-scale enterprises; and the provision of affordable housing through the construction of 200,000 units annually over the next five years as some of the areas that could interest American investor
He said the government will channel strategic investment into these sectors to catalyse and maintain high rates of economic performanc
“Underlying these five pillars is a commitment to complete an ambitious programme of infrastructure development, covering transport and communications as well as energy and the provision of operational facilities for enterprises and industries,” noted Rut
Effective mod
The president said among various implementation formats that have been adopted, the public-private partnership model has emerged as particularly effective in aligning opportunities with appropriate incentives, and in mobilising necessary finances to achieve win-win outcomes under conditions of limited fiscal space.
“ I am here to invite you to seriously consider these opportunities, take advantage of our excellent bilateral relations and partner with us in this exciting journey,” he told the US firms
“Several reasons, which speak to the defining features of the means as well as the ends of these programmes and projects, motivate this invitation
Ruto noted that Kenya’s advantageous location has been optimally complemented by a nation of well-educated, highly skilled, hospitable and enterprising people
“Communication is easy, and our labour force is famously agile. Our Kenyan workforce has always been our greatest strength,” he said
But despite the great strides the country has made, Ruto admitted that there is more work to be don
“Private sector players make long-term investment decisions in an environment with predictable policies, among them tax policie
“My government is finalising new tax policy guidelines that have gone through various stakeholder consultations, including inputs from AmCha
This policy that will enhance transparency in our tax regime will take effect by June 2023 and will now be in place for a minimum of three years,” he said
And as part of the charm offensive, the president pledged to review the imposition of digital services tax on income derived in their tax jurisdiction
“Following discussions with players in this sector, we have made a commitment to review this tax regime and align it with the two-pillar solution currently being developed by the Organisation for Economic Cooperation and Development inclusive framewor
“The framework will guide the taxation of digital commerce transactions,” the president sai
He also said VAT on exported services, which he said not only renders the country uncompetitive but also inhibits investors seeking to make Kenya their regional or global services hub, will be removed in this year’s Finance Bill
Ruto also said the government is making a policy shift on tax refunds and as a result, effective June this year, all verified tax refund claims will be payable within six months
“If for whatever reason a refund is not made by the Kenya Revenue Authority (KRA) within this period, the taxpayer can offset their claim against future tax liability, without further application to KRA,” he adde
Ruto reckons the full implementation of Africa’s free trade area will help Kenya and other African countries to tap the record number of young people in the continent to unlock fast economic growth in many countrie
The pan-African free trade zone aims to bring 1.3 billion people together in a $3.4 trillion (Sh384 trillion) economic bloc that supporters say will boost living standards, encourage development and make Africa less dependent on trade with other region
Ratified de
Kenya, which is grappling with the effects of the Russia-Ukraine war, was the first country in eastern Africa to ratify the African Continental Free Trade Area deal after the National Assembly adopted i
Most African countries depend on exports of raw materials and on imports of essential goods such as food items and pharmaceutical
In Rwanda, Ruto said Kenya is keen to deepen its trade relations with its East African Community partner as part of efforts to diversify its product
He urged Rwanda to take advantage of the more efficient port of Mombasa for import and export business, which allows cargo owners the option to collect goods at the Naivasha Inland Container Depot.s.s.t.als.s.d.. . d.k.s.. m.s.e.. . .”. elo.e.s.d.. s.d.. d.sss.t.s.s.s.tel.
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