Kenya climbs 19 places in World Bank’s latest Ease of Doing Business report

Kenya Ease of Doing Business 2019
President Kenyatta said Kenya was reaping the benefits of paying attention to various key reforms that have made the country more attractive for investment during the Ease of Doing business event in Nairobi. Photo: Twitter/UKenyatta

Kenya has risen 19 places to 61 in the World Bank’s Ease of Doing Business 2019 report which was released on Wednesday.

This makes the East African country the seventh most improved globally and increases its attractiveness to investors. In the Sub-Saharan region, Kenya is third, behind Mauritius and Rwanda who are ranked 20th and 29th respectively overall.

Speaking at the Ease of Doing Business event in Kenya yesterday, Department for International Development Country Director Sarah Montgomery described the country’s improvement as a “fantastic result”, adding “it shows what concerted, coordinated efforts between the government, private sector and development partners can achieve.”

Following the publication of the report the night before, UK High Commissioner Nic Hailey Tweeted: “Proud that UKAid has supported Kenya’s continued progress up the Ease of Doing Business rankings. Congratulations to all Kenyans who’ve made these reforms happen – great for investment and prosperity.”

According to the report, Kenya strengthened access to credit, protection of minority investors, increasing shareholder rights and eased the payment of taxes by merging all permits into a single unified business permit. 

By facilitating the continuation of a debtor’s business during insolvency proceedings, providing for equal treatment of creditors in reorganization proceedings and granting them greater participation, Kenya has also made resolving insolvency easier.

Efforts by the government to make property registration more straightforward, by introducing an online system to pay fees and obtain digital certificates, has meant the time this takes has reduced to 49 days from 61 days, the report says.

Accessing credit has also improved, moving Kenya to eighth place from 29 last year, well above the regional average getting credit rank of 115.

However, the country has struggled with construction permits where it takes just over five months to obtain all permits and authorizations to build a warehouse compared with the Sub-Saharan Africa regional average of 146 days. It takes 91 days in Niger and 113 days in Rwanda to achieve the same which led to Kenya being ranked in 128th place in this area.

According to the report, despite a reform in the past year to make registering property easier, a business has to go through nine procedures to affect a property transfer, compared to a regional average of six.

Starting a business in Kenya was also highlighted as an area for improvement.

“It costs 25 percent of the income per capita to start a business in Kenya which is almost ten times more expensive than in Côte d’Ivoire and the process takes 23 days compared to just four days in Rwanda,” the report states.

Within Kenya itself, ranked among 11 locations in the country, Nairobi was in first place for ease of registering property, Uasin Gishu (Eldoret) was the easiest area to start a business, Kisumu was top for dealing with construction permits and Busia (Malaba) came out in first place for enforcing contracts.

The UK is ranked 9th, once place behind the USA, and Kenya’s current position is only 11 places away from their target of reaching the top 50 by 2020.

Posting on Twitter, Deputy British High Commissioner, Susie Kitchens said that the UK shared the Kenyan government’s commitment to reach the top 50, but to achieve this aspiration the country will need infrastructure, transparent regulations, technology and zero tolerance for corruption.

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