Small Business Environment in Kenya

Small Business Environment in Kenya Introduction Geographically, Kenya lies to the East of Uganda, to the Northern Part of Tanzania and to the West of Somalia. The country enjoys access to the Indian Ocean which it majorly uses for its imports and exports although comprehensively it covers an area of 592,909 square kilometers (Exports Processing Zones Authority 2005, 33).Advertising We will write a custom report sample on Small Business Environment in Kenya specifically for you for only $16.05 $11/page Learn More The country has a total population of approximately 38.6 million according to recent 2010 statistics (World Bank 2010, 46). Predominantly, the country is agricultural, with its major exports being Tea and horticultural produce (like flowers) which it majorly exports to Europe. Kenya has experienced a relatively peaceful political environment since its independence in 1963 with its major democratic hallmark being the peaceful transition of power from its longtime serving president Dani el Moi to Mwai Kibaki in 2002 (Exports Processing Zones Authority 2005, 68). However, in the eve of the elections of 2007/2008, the country experienced both political and social tensions which also spilled over to the economic progress and backtracked on the country’s gains in economic development which stood at nearly 7% per annum (Business Daily Africa 2008, 52). The country later adopted a political settlement that now sees the Sub Saharan nation under the leadership of a Prime minister and a President. This situation has led to a rejuvenation of economic and infrastructural changes that have especially been boosted by the country’s adoption of a new constitution in August 2010 (World Bank 2010, 50). At present, prudent economic policies have been effected and the country now experiences tremendous infrastructural changes and a decrease in unemployment levels. The country also has most of its organizations and businesses centralized at the nation’s headquarte rs, Nairobi (Exports Processing Zones Authority 2005, 97). The country’s leadership has in the past laid proper groundwork for creating an investment friendly atmosphere with economists projecting that the country could achieve economic growths at the rate of 8% per annum by the year 2025 (African Development Bank 2010, 74).Advertising Looking for report on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More The Central Bank of Kenya is currently undertaking stable fiscal and monetary policies that have ensured a stable monetary policy in the past few years. Kenya being strategically located in the wider East African region because of its seaport (Mombasa); it has a strategic economic importance in the region (Exports Processing Zones Authority 2005, 54). This study seeks to evaluate the small business environment in the region with a careful analysis of the pros and cons the country faces with regards to Sma ll businesses. This study will also provide recommendations on how the country can improve its cons and take advantage of its pros to boost the growth of Small businesses Infrastructure The government of Kenya is currently involved in improving the country’s infrastructure to ensure current facilities in the country are working in an efficient manner. Such efforts are currently aimed at rehabilitating, improving, maintaining, and upgrading existing roads, airports, seaports and other infrastructural facilities. Airports Kenya currently has a well developed international and domestic air transport network that at least covers the entire strategic locations of the country. International airports are located in three cities while domestic airports (for small aircrafts) are located in two cities: Nairobi’s Wilson Airport and Kisumu’s airport (Exports Processing Zones Authority 2005, 52). For areas that are inaccessible by road, the country has more than 150 airstrip s scattered all over the country to provide access to remote locations (Exports Processing Zones Authority 2005). These airports and airstrips are strategically located to provide goods and services to most businesses in the country. Seaports Kenya majorly has one seaport in Mombasa which serves a major economic role for both micro and macro economic business entities. This seaport is termed as one of the most modern in Africa with its strategic importance extended to serving other landlocked countries like Uganda, Rwanda, and Burundi (Exports Processing Zones Authority 2005, 45). The seaport serves a major strategic role in small businesses because most goods and raw materials dock at the port, after which they are transported countrywide.Advertising We will write a custom report sample on Small Business Environment in Kenya specifically for you for only $16.05 $11/page Learn More Roads Kenya has a relatively good road network serving most of its major tow ns. However, the country’s road networks in remote locations where many small businesses thrive are relatively poor with a huge majority of them being murram. Nonetheless, the country’s major highways are known to account for more than 70% of the total freight transported in the country. The cost of transporting freight is advantageously negotiable and most often cheap (Exports Processing Zones Authority 2005). In this regard, small business owners are able to transport their goods and raw materials in virtually all corners of the country. Notably, the country’s infrastructure is used to transport large freight including oil and other goods to the country’s neighbors. This carriageway is known as the Northern Corridor (Exports Processing Zones Authority 2005). Railway Kenya’s railway network is not as advanced as it should be because the rail infrastructure at present is the same rail network used during the colonial period. However, most of the co untry’s rail network covers major commercial centers. On a positive light, the country’s rail network seeks to gain from reforms aimed at modernizing the country’s infrastructure in the coming few years due to massive transport reforms to be undertaken by the Ministry of Transport. Telecommunication Most small businesses in Kenya thrive from a good telecommunication network. Currently, Kenya is served by four GSM service providers with a relatively strong coverage across the country. In addition, more than 80 internet service providers are currently operating in the country through cut throat competition that has tremendously reduced the costs of telecommunication (Exports Processing Zones Authority 2005).. Electricity Electricity in Kenya is majorly created through hydropower and distributed in 250 volts 50 cycles single phase (Exports Processing Zones Authority 2005). The government is currently engaged in encouraging the private sector to involve itself in th e production of more electricity because virtually all small business and large business entities rely on power for most of their operations.Advertising Looking for report on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Power is however generated through the country’s main electric generating parastatal, Kenya Electricity Generating Company (KENGEN) but it is distributed through another State parastatal, Kenya Power and Lightning Company (KPLC) (Exports Processing Zones Authority 2005). Water And Sanitation Water is majorly supplied by authorized water agents and local authorities (such as municipals and councils). Most councils and municipalities in major commercial centers are engaged in the provision of basic sewage and sanitation services for business entities. However, due to the proliferation of small business entities and indeed the population, most of Kenya’s councils and municipalities are currently seeking to increase their water supply and expand their sewage services to meet the demand. Investments Policies, Laws And Regulations For Small Businesses The Kenyan government is currently aiming at increasing the confidence of both local and foreign investors to increase their investments in the country. A great part of this effort has been through a revision of existing laws and procedures of setting up small businesses in Kenya. Currently, the private sector contributes a greater part of the country’s Gross Domestic Product (GDP). One of the government’s main strategies to induce both local and foreign investors is to sell most of its stakes to them. In this manner, the government has initiated a diversification from public sector investments to private sector investments. The kinds of investments earmarked for privatization include some of the largest to the smallest state corporations (Kenya Investments Authority 2010, 232). This trend is projected to create more business opportunities for investors. In addition, laws, policies and regulations are quickly being explained and eased through the investment promotion centre (www.investmentkenya.com) which assists both local and foreign investors in setting up businesses in the country. The s ervice has of late been upgraded to meet the modern needs of businesspersons in the country (Kenya High Commission 2010, 17). Application procedures and approvals are currently being facilitated through the medium as well. Kenyan laws currently allow for the setting up of small businesses in form of partnerships, private companies, joint ventures and public companies. This provides many local and foreign investors with a wide selection of alternatives on the type of businesses the may wish to undertake. The Kenyan Foreign investment act currently governs and safeguards all types of legal investments by Foreigners and undergoes periodic reviews which keep existing laws relevant with the changing business environment. For instance, there was a previous requirement that if foreign investors wished to set up business in the country, they had to apply for a Certificate of Approval so that they may be able to repatriate capital and profits (Exports Processing Zones Authority 2005). This p rovision is no longer there; which means that investors do not have a limit to foreign participation in local businesses, in terms of equity input or otherwise. The government currently wishes to adopt more business friendly rules and policies. These new regulations are expected to further streamline licensing and other application procedures while also increasing the degree of transparency and accountability in providing the same business provisions (Claasen 2010, 2). Information is therefore expected to be easily available to investors, including the procedures and legislation governing small businesses in the country. Investment Opportunities For Small Businesses There are currently many investment opportunities for small businesses as outlined by the Kenyan government. These opportunities are outlines as follows: Information Communication Technology (ICT) ICT is a fast growing sector in the Kenyan economy and many small business owners are bound to gain from the increased ICT ad option in the country. Such opportunities present themselves in form of software development, telecommunication services, E marketing and the likes (Sudan 2010, 67). Such opportunities are complimented by the huge human resource pool of skilled, English speaking, human resource experts who graduate from Kenyan universities each year. Commercial Dairy Farming Currently, the government is undertaking preliminary studies to asses the feasibility of privatizing most of its Artificial Insemination (AI) services. The same opportunity still exists in dipping services as a major dairy subsector (which has in the past been undertaken by the government). Clinical services are also being privatized by the government and this also presents an opportunity for more private sector participation. Tourism Since the government has extensively undertaken major strides in marketing the country as a topnotch tourist destination in Africa, increased tourist figures are expected to boost small businesses that make local artifacts for sale to tourists. Other kinds of businesses expected to grow in this sector include tour agencies, tourist cafeterias, hotels, catering industries and the likes. Other Other small business opportunities exist in the agricultural sector, textile industry, food industry, education sectors, agribusiness, manufacturing sectors and transport sectors (Kinyanjui 2000, 15) Technological Environment Many countries with regard to small and medium enterprises (SMEs) have gained from technological changes that set off in the 1990s (Hill 1987, 5). However, in Kenya, technological changes have not impacted small businesses very positively. Many local investors are not well versed with new technologies and this has led to a lot of confusion regarding the incorporation of technology in day to day business operations. In fact, most businessmen and investors who are strategically positioned to gain from technological changes are interestingly unaware of it, whereas inves tors who are aware of it, lack adequate access to technology but in some cases it is too expensive (King 2002, 67). Foreign investors have therefore in the past been better placed to gain from technological changes. Kenya and most Sub-Saharan countries have often found immense difficulty in using technology to integrate the activities of small businesses with potential investors, both locally and internationally (Wanjohi 2008, 5). The situation is further worsened by the wide technological rift between business men in rural areas and those in urban centers. Technological development in rural Kenya is also hampered because there is limited access to electricity among other social amenities that make internet connectivity available. Access to information is therefore hampered in this sense and small businesses in rural Kenya are isolated from existing networks that can provide the break through most small businesses in rural Kenya need for growth and prosperity. Technological changes in Kenya therefore do not seem to help entrepreneurs in rural Kenya at all. Credit Availability Small businesses the world over, have been identified to suffer from limited access to capital. In turn the alternatives in technology are greatly limited due to a lack or insufficient credit. For example, many small businesses have been observed to use inappropriate technology because they cannot afford the cost of using the right technology (IFC 2009, 65). Sometimes, even when credit is readily available, some investors may be forced to compromise their freedom in choosing the right purchasing equipments because of stringent regulations in lending. The constraining nature of the Kenyan credit market has therefore forced many small investors to seek alternative ways of financing like self funding and seeking funds from friends and relatives. In addition, the limited access to long term financing methods has forced many businesses to contend with short term methods of financing which are often expensive (Muteti 2005, 27). Other types of financial challenges many small businesses in Kenya face include high banking costs, high interest rates and exorbitant fees in borrowing funds. The year 2008, brought this issue to fore because most of the country’s small business investors were hoodwinked into joining pyramid schemes that never bore fruit. However, from the whole scam, it was evidently cleat that many people were desperate for a lending mechanism that enabled them to pay back borrowed money in small interest rates. Investment Protection Agreements The government has made specific legislations in its constitution to safeguard both local and foreign investors against unforeseen business calamities. One such guarantee is the protection against expropriation of businesses or private properties which is often undertaken by governments for public interest. In case such an eventuality occurs, the law guarantees investors compensation. Another such guarantee is the repatriation of profits and interests under the Foreign Investment Protection Act which allows foreign investors to repatriate their profits after tax (including retained moneys which have not been capitalized) (Kenya Investments Authority 2010, 112). In the same regard, they can also repatriate any interest payments associated with borrowed loans. Also, Kenya is a member of the World Bank Multilateral investments Guarantee Agency which safeguards businessmen from risks of a non commercial nature (Kenya Investments Authority 2010, 16). Investment Promotion Centre Investment promotion centre was established through an act of parliament to assist micro and macro businesses to operate in the country. This body helps small businesses facilitate their licensing requirements before they commence business and also support the promotion of local investments in both local and international stages (Kenya Investments Authority 2010). The body works closely with relevant government ministries a nd most notably the Ministry for local government in establishment of local businesses to assist investors procure licenses and required permits for business. Currently, the body assists small business investors in obtaining licenses within six months or less. Small businesses are not governed by any equity ceiling, although foreign investors are required to partner with local investors when undertaking small businesses in the country (Kenya Investments Authority 2010). With regards to business opportunities created from government privatization of its departments, the Investment promotion centre can assist small businesses acquire businesses within four weeks upon availability of the necessary documentations (Kenya Investments Authority 2010). Recommendation Kenya has a favorably good business environment for small businesses to thrive. However, since small businesses thrive majorly in remote commercial areas, it is important that the government expand the infrastructure in the rur al areas to support the growth of small businesses. Such developments can be facilitated through private-public partnerships which are expected to hasten such developments. Also, a great deal of the country’s small businesses is concentrated in major commercial centers of the country, thereby disproportionately growing small businesses. The government should therefore provide more incentives for growth of small businesses in rural areas which account for a greater majority of the country’s population. This can be achieved through a reduction of taxes or a reduction of land rates as a factor of production. Licensing has also notably been more bureaucratic than it should be. Considering most nations have achieved fast and more efficient ways of licensing, it is important that the country also follow the same precedent (Organization for Economic Cooperation 2010, 3). Some licensing requirements are noted to take more than six months before being processes, meaning that th e system needs to be automated to increase the speed of such processes. Some of the country’s laws regarding foreign investments also backtrack on the country’s quest to improve foreign investments in the country. For example, the legal requirement that foreign investors ought to partner with local investors in owning agricultural land or setting up small business is retrogressive. Such laws are therefore redundant and should be changed through increased pressures by the business community in improving the business landscape of the country. Conclusion Kenya is a major economic hub of the wider East African region. Its business environment is supported by the government’s commitment to change existing and archaic policies that have previously stunted the economic growth. When compared to other countries of its peers, Kenya is firmly on the path to growth prosperity especially boosted by small business development. The growth of small business is especially expect ed to thrive from the government’s review of existing policies, growth of the ICT and tourism sectors plus an improvement in the country’s infrastructure. The country is therefore expected to substantially grow from increased investor confidence and an upsurge of business opportunities across major economic sectors. That said, Kenya provides a good business environment for the growth of small businesses. Reference List African Development Bank. 2010. African economic outlook, volume 1. New York: OECD Publishing. Business Daily Africa. 2008. Kenya loses Grip on Business reforms, March 4, www.businessdailyafrica.com/-/539552/655052/-/584plu/-/index.html . Claasen, Mario. 2010. Social Accountability in Africa. Practioners Experiences and  Lessons. Johannesburg: African Books Collective. Exports Processing Zones Authority. 2005. Doing Business in Kenya. Nairobi: International Research Network. Hill, Thomas. 1987. Small Business Production/Operations Management. Nairobi: Macmillan Education Ltd. IFC. 2009. Press Releases and Features: Doing business in Kenya, September 9, www.ifc.org/ifcext/media.nsf//DB2010_Kenya_Sep09 . Kenya High Commission. 2010. Doing Business in Kenya, June 10, www.kenyahighcommission.net//doing-business-in-kenya.html . Kenya Investments Authority. 2010. Kenya Investments Authority: Home, March 10, www.investmentkenya.com/. King, McGrath. 2002. Globalization, Enterprise and Knowledge. Oxford: Symposium. Kinyanjui, Maina. 2000. Tapping Opportunities In Enterprise Clusters In Kenya: The  Case Of Enterprises In Ziwani And Kigandaini. Nairobi: Institute for Development Studies, University of Nairobi. Muteti, James. 2005. SMEs in Kenya. Nairobi: The Catholic University of Eastern Africa (CUEA). Organization for Economic Cooperation. 2010. Perspectives on Global  Development 2010: Shifting Wealth. New York: OECD Publishing. Sudan, Randeep. 2010. The Global Opportunity in IT-Based Services: Assessing and  Enhancing Country Comp etitiveness. London: World Bank Publications. Wanjohi, Mugure. 2008. Factors Affecting The Growth Of Mses In Rural Areas Of  Kenya: A Case Of ICT Firms In Kiserian Township, Kajiado District of Kenya. Nairobi: Longhorn Publishers. World Bank. 2010. Doing Business in Kenya 2010, January 20,  psdblog.worldbank.org//doing-business-in-kenya-2010.html .

Timeline of the Ancient Maya

Timeline of the Ancient Maya The Maya were an advanced Mesoamerican civilization living in present-day southern Mexico, Guatemala, Belize, and northern Honduras. Unlike the Inca or the Aztecs, the Maya were not one unified empire, but rather a series of powerful city-states that often allied with or warred upon one another. Maya civilization peaked around 800 A.D. or so before falling into decline. By the time of the Spanish conquest in the sixteenth century, the Maya were rebuilding, with powerful city-states rising once again, but the Spanish defeated them. The descendants of the Maya still live in the region and many of them continue to practice cultural traditions such as language, dress, cuisine, and religion. The Maya Preclassic Period (1800–300 BCE) People first arrived in Mexico and Central America millennia ago, living as hunter-gatherers in the rain forests and volcanic hills of the region. They first began developing cultural characteristics associated with the Maya civilization around 1800 BCE on Guatemalas western coast. By 1000 BCE the Maya had spread throughout the lowland forests of southern Mexico, Guatemala, Belize, and Honduras. The Maya of the Preclassic period lived in small villages in basic homes and dedicated themselves to subsistence agriculture. The major cities of the Maya, such as Palenque, Tikal, and Copn, were established during this time and began to prosper. Basic trade was developed, linking the city-states and facilitating cultural exchange. The Late Preclassic Period (300 BCE–300 CE) The late Maya Preclassic Period lasted roughly from 300 B.C. to 300 A.D. and is marked by developments in Maya culture. Great temples were constructed: their facades were decorated with stucco sculptures and paint. Long-distance trade flourished, particularly for luxury items such as jade and obsidian. Royal tombs dating from this time are more elaborate than those from the early and middle Preclassic periods and often contained offerings and treasures. The Early Classic Period (300 CE–600 CE) The Classic Period is considered to have begun when the Maya began carving ornate, beautiful stelae (stylized statues of leaders and rulers) with dates given in the Maya long count calendar. The earliest date on a Maya stela is 292 CE (at Tikal) and the latest is 909 CE (at Tonina). During the early Classic Period (300–600 CE), the Maya continued developing many of their most important intellectual pursuits, such as astronomy, mathematics, and architecture. During this time, the city of Teotihuacn, located near Mexico City, exerted a great influence on the Maya city-states, as is shown by the presence of pottery and architecture done in the Teotihuacn style. The Late Classic Period (600–900) The Maya late Classic Period marks the high point of Maya culture. Powerful city-states like Tikal and Calakmul dominated the regions around them and art, culture and religion reached their peaks. The city-states warred, allied with, and traded with one another. There may have been as many as 80 Maya city-states during this time. The cities were ruled by an elite ruling class and priests who claimed to be directly descended from the Sin, Moon, stars, and planets. The cities held more people than they could support, so trade for food, as well as luxury items, was brisk. The ceremonial ball game was a feature of all Maya cities. The Postclassic Period (800–1546) Between 800 and 900 A.D., the major cities in the southern Maya region all fell into decline and were mostly or completely abandoned. There are several theories as to why this occurred: historians tend to believe that it was excessive warfare, overpopulation, an ecological disaster or a combination of these factors that brought down the Maya civilization. In the north, however, cities like Uxmal and Chichen Itza prospered and developed. War was still a persistent problem: many of the Maya cities from this time were fortified. Sacbes, or Maya highways, were constructed and maintained, indicating that trade continued to be important. Maya culture continued: all four of the surviving Maya codices were produced during the Postclassic period. The Spanish Conquest (ca. 1546) By the time the Aztec Empire rose in Central Mexico, the Maya were rebuilding their civilization. The city of Mayapan in Yucatn became an important city, and cities and settlements on the eastern coast of the Yucatn prospered. In Guatemala, ethnic groups such as the Quichà © and Cachiquels once again built cities and engaged in trade and warfare. These groups came under the control of the Aztecs as a sort of vassal states. When Hernn Cortes conquered the Aztec Empire in 1521, he learned of the existence of these powerful cultures to the far south and he sent his most ruthless lieutenant, Pedro de Alvarado, to investigate and conquer them. Alvarado did so, subduing one city-state after another, playing on regional rivalries just as Cortes had done. At the same time, European diseases such as measles and smallpox decimated the Maya population. Colonial and Republican Eras The Spanish essentially enslaved the Maya, dividing their lands up among the conquistadors and bureaucrats who came to rule in the Americas. The Maya suffered greatly in spite of the efforts of some enlightened men like Bartolomà © de Las Casas who argued for their rights in Spanish courts. The native people of southern Mexico and northern Central America were reluctant subjects of the Spanish Empire and bloody rebellions were common. With Independence coming in the early nineteenth century, the situation of the average indigenous native of the region changed little. They were still repressed and still chafed at it: when the Mexican-American War broke out (1846–1848) ethnic Maya in Yucatn took up arms, kicking off the bloody Caste War of Yucatan in which hundreds of thousands were killed. The Maya Today Today, the descendants of the Maya still live in southern Mexico, Guatemala, Belize, and northern Honduras. Many continue to hold to their traditions, such as speaking their native languages, wearing traditional clothes and practicing indigenous forms of the religion. In recent years, they have won more freedoms, such as the right to practice their religion openly. They are also learning to cash in on their culture, selling handicrafts at native markets and promoting tourism to their regions: with this newfound wealth from tourism is coming political power. The most famous Maya today is probably the Quichà © Indian Rigoberta Menchà º, winner of the 1992 Nobel Peace Prize. She is a well-known activist for native rights and occasional presidential candidate in her native Guatemala. Interest in Maya culture was at an all-time high in 2010, as the Maya calendar was set to reset in 2012, prompting many to speculate about the end of the world. Sources Aldana y Villalobos, Gerardo and Edwin L. Barnhart (eds.) Archaeoastronomy and the Maya. Eds. Oxford: Oxbow Books, 2014. Martin, Simon, and Nicolai Grube. Chronicle of the Maya Kings and Queens: Deciphering the Dynasties of the Ancient Maya. London: Thames and Hudson, 2008. McKillop, Heather. The Ancient Maya: New Perspectives. Reprint edition, W. W. Norton Company, July 17, 2006. Sharer, Robert J. The Ancient Maya. 6th ed. Stanford, California: Stanford University Press, 2006.