Thread by @mmnjug

Whenever there is a discussion regarding reinvigorating the business environment in Kenya, they inevitably pivot to the fact that MSMEs contribute about 34% of the GDP and employ about 15M people. - @CAK_Kenya

#WCD
#WCD2021

Unfortunately, a fifth of these small firms fail in their first year and just a third survive past their tenth birthday.

The survival rates are attributed to hurdles disproportionately facing SMEs such as unfair competition practices including incidences where buyer firms with superior bargaining power delay payments, impose unfair contract terms or transfer costs when dealing with suppliers.

Additionally, unfair exclusive agreements imposed by big players foreclosses the value chain chain by creating barriers to entry and expansion while price fixing contraventions render certain services inaccessible and unfordable for MSMEs.

Govts may also affect the operations of these firms through their regulatory regimes and unfavourable licensing policies which increase transactional costs and affect supply chains. For instance, investors require multiple licenses to open a small retail outlet in the country.

These costs add to the financing strain facing MSMEs purchasing equipment for expansion thereby stalling their growth. This is mainly due to lack of credit history and collateral to support the application process.

.@CAK_Kenya aims to among others, extinguish the challenges facing MSMEs including advising the national and county gvts to promulgate regulatory regimes supportive of a conducive investment climate.

#WCD
#WCD2021

Additionally, interventions against big business disenfranchising their smaller supplier partners has occasioned the release of Kes2.5B+ to MSMEs in the retail and insurance space.

Further to this, we have supported the bargaining position of MSMEs entering into agreements with buyers by developing template contracts to guide the process.

We have developed a regulatory impact assessment framework to guide national and county gvts when promulgating regulatory regimes.

Such guidance occasioned the removal of barriers to entry in the growing and processing of specialty tea leading to opening of 5 factories directly and indirectly employing 2,000+ Kenyans.

#WCD
#WCD2021

The tea intervention also led to an increase of specialty tea prices at Kes600/kg compared to traditional tea's going rate of Kes70/kg.

In the telecoms sector, we extinguished exclusive agreements in the mobile money agents contracts with mobile network operators, the agents network increased by 150%+coupled with increased commissions for the agents.

.@CAK_Kenya also approved a merger relating to a major beverage company bottling on condition that they reserve 20% of their refrigerator space for competitor brands distributed by MSMEs.

This was informed by the need to facilitate new entrants gain access to the market and exert positivecompetitive pressure on incumbents

These interventions resonate with #WorldCompetitionDay which is held every 5th of December with the 2021 theme being: Compatition Policy for an Inclusive and Resilient Economy.

In line with this GoK supported businesses that have been negatively affected by Covid19 with interventions like: payment of pending bills and VAT refunds, reduction of MSMEs turnover tax and operationalising the credit guarantee scheme.

These interventions are further buttressed with the aim of making linkages and drive efficiencies which may be attained through developing developing eRepositories, linking MSMEs to new markets, suppliers and funding opportunities.

This platform should be developed through partnerships between private sector and MSMEs. To reduce regulatory obstacles @KeTreasury may create a competition yardstick by pegging disbursements to interventions deployed to support MSMEs.

Development and operationalisation of the leasing framework under MTP III will facilitate MSMEs acquire the requisite capital to penetrate markets.

Finally and importantly, aware of the fact of the high MSMEs mortality rate could be attributed to internal governance weaknesses and controls, there should be capacity building to create a resilient sector and tertiary institutions can create curriculum to support it.

#WCD2021

Balancing MSMEs' growth and while enforcing competition law. by @CAK_Kenya

#WCD
#WCD2021
#WorldCompetitionDay

How will @CAK_Kenya balance MSMEs' growth whilst enforcing competition laws? bit.ly/2ZXX0NC in @BD_Africa

#WCD
#WCD2021