Kenyan Government should promote entrepreneurship

How the Kenyan Government should promote entrepreneurship

It’s a no brainer that the Kenyan Government should promote entrepreneurship. But Governments usually don’t know how to handle small businesses. HerBusiness takes a look at how to fix this relationship.

Much has been said about how the Kenyan Government should promote entrepreneurship. The Government has repeatedly come out to say that it’s committed to this. It even has entrepreneurship as one of the key pillars to realizing the great goal that is Vision 2030.

While the steps that have been taken are commendable, compared to its peers, there’s still plenty to be done. There is a fundamental problem to Government supporting small to medium sized enterprises. Government is a behemoth; it only knows how to work through centralized planning. The world of small enterprises on the other hand cannot be directed.

So the Kenyan Government may have the best intentions to help but by its nature it either wastes resources or causes more problems. What then are the basics it must get right to get into the good books of entrepreneurs?

The first thing it must get right is its job to create an enabling environment. This regards business-friendly laws. Starting a business should be a fast process with as few pit stops as possible. This, among other things, makes Kenya a disappointing 9th easiest place to do business in Africa.

One paradox of a government creating an enabling environment is that business does best with less of the governments claws dug in. All the same, entrepreneurs would like to see an initiative in creating laws that support startups. Some of these include tax-breaks and IP safeguards.

We know the Government is all over the place trying to fund entrepreneurs. This is especially true youth, women and disabled persons. But this has the effect of propagating corruption. In Kenya, the public sector is still seen as a place to make money. This greed is best directed to the private sector.

Guarantees loans for entrepreneurs
Guarantees loans for entrepreneurs

Kenya should borrow from the US Government. The United States has a body that guarantees loan requests by entrepreneurs to commercial banks; the US Small Business Administration. This is the best answer to how the Kenya Government should support entrepreneurship with regard to funding.

Another way is to set up enterprise zones. This will no doubt prove profitable. In the same way we have Export Processing Zones (EPZs). Difference here is that profits won’t be appropriated to foreign countries. Set these up for entrepreneurs and watch them come.

Kenya is trying to do such a thing with its tech city, Konza. The problem is that this is a top-down solution. It goes back to the Government’s fault of centralized planning. This also represents a great misdirection of resources at the expense of building on what we already have; sectors that will uplift more people than tech; like agriculture and light manufacturing. Is it not impressive how you can fill a trolley with ‘Made in Kenya’?

Lastly, the Kenya Government should support entrepreneurship by promoting a culture for this in the country. It’s not impossible. We have seen the Government hold nothing back in fighting HIV/AIDS stigma with decent success. Entrepreneurship must be made even cooler by making a priority of the regime.

That summarizes the basics of what Kenya’s Government should do to promote entrepreneurship. Other pointers  can then be built off these.