| ||||||||||||
| ||||||||||||
| ||||||||||||
| ||||||||||||
|
Country Commercial Guides for FY 2000:
Report prepared by U.S. Embassy |
CHAPTER VII: INVESTMENT CLIMATE
A. OPENNESS TO FOREIGN INVESTMENT
The Government of Kenya encourages foreign direct investment. Multinational companies make up a large percentage of Kenya's industrial sector. In the past, government support for foreign investment was often implicitly conditioned on some form of joint venture whereby a related parastatal or a politically well-connected individual became the local partner. This practice is becoming less common with economic liberalization and privatization of public sector enterprises. Particularly since 1994, the Government of Kenya has sought out foreign investment through investment conferences and foreign trips by the Head of State.
Foreign investment is not routinely screened. Nevertheless, investors may choose to take advantage of the one-stop office of the Investment Promotion Center (IPC), created in 1982 under the Ministry of Finance, and an independent agency since 1986. The IPC sets minimal environmental, health and security requirements for its projects. An investment code has been in the works since 1994. The code would set forth guidelines on investment, enumerate the various investment incentives and mandate that all new projects obtain IPC approval. Efforts are under way to harmonize investment regimes in Kenya, Uganda and Tanzania and, eventually, to remove all tariff barriers between the three East African countries. In addition, the three Investment Authorities are working towards harmonizing the investment incentives.
It is Government of Kenya policy to encourage investment that will produce foreign exchange, provide employment, promote backward and forward linkages and transfer technology. The only significant sectors in which investment (foreign and domestic) are constrained are those where state corporations still enjoy a statutory or de facto monopoly. These are restricted almost entirely to infrastructure (e.g., power, posts, telecommunications, and ports) and the media (e.g., radio). Even in these sectors, ongoing commercialization and economic reform is expanding the room for private business. Two foreign private sector power producers sell more than 85 MW of electricity to the national grid. Purchase agreements with two other independent power producers (IPPs) were put in place in 1999.
In July 1999, Kenya Posts and Telecommunications Corporation was split into Telkom Kenya, a telecommunications corporation, and Postal Corporation of Kenya, a postal services corporation. The Communications Commission of Kenya (CCK) was also established to regulate those sectors. The government plans to sell up to 49 percent of Telkom Kenya to a strategic partner before an initial public offer is made on the Nairobi Stock Exchange. With the right competitive environment, the potential for private sector investments in telecommunications is enormous.
Branches of foreign companies pay higher income tax rates than local companies and locally incorporated subsidiaries of foreign companies. The 1997/98 GOK finance bill reduced these rates to 40 percent for foreign companies and 32.5 percent for local firms. There is no discrimination against foreign investors in access to government-financed research. Expatriates face difficulties in obtaining work permits, but the requirements are not onerous. The Government of Kenya's export promotion programs do not distinguish between local and foreign-owned manufacturers.
B. CONVERSION AND TRANSFER POLICIES
In December 1995, Kenya repealed its Foreign Exchange Control Act. (Ministerial decrees had previously removed nearly all limitations.) There are no remaining restrictions on converting or transferring funds associated with an investment. No recent changes or plans to tighten remittance policies exist. Foreign exchange is readily available. Kenya has had a floating exchange rate since late 1993. On July 1, 1996, Kenyan shillings became freely convertible into Tanzanian and Ugandan shillings and vice versa.
C. EXPROPRIATION AND COMPENSATION
Article 75 of the constitution prohibits the nationalization of private property without prompt and full compensation. Kenya has also enacted the Foreign Investment Protection Act that protects foreign investment against expropriation. The American Embassy is not aware of any cases of expropriation. During the 1980's, however, the government used its authority on occasion to compel foreigners to sell a portion of profitable companies to political insiders. The Insurance Act was amended, for instance, to require large foreign insurance companies to have at least 33 percent local ownership. Foreign brokerage and fund management firms are allowed to participate in the local capital market only through locally registered companies. Such locally registered firms must have local ownership of at least 51 percent in case of brokerage firms, and 30 percent for fund management firms. Another example is the International Casino in Nairobi, formerly wholly Italian-owned, which sold out to local investors after government regulators ran down its business. More recently, some telecommunications companies have been compelled to sell equity to Kenyans to meet the government's new 60 percent local ownership requirement.
D. DISPUTE SETTLEMENT
The American Embassy is not aware of any outstanding investment disputes involving U.S. or other foreign investors. Government delays in remission of value-added tax on exported goods have caused frustration to business people generally, but have not resulted in litigation. Likewise, corruption and slow clearance of imported inputs, goods and capital equipment has handicapped industry and trade. In the past, tight controls on foreign exchange led to disputes over the repatriation of profits. Liberalization of the economy, and the foreign exchange regime in particular, since 1993 has removed that irritant.
The only legal dispute in the past few years was between the government and the U.S. company Arkel International. Arkel won contracts in 1987 and 1990 to expand a parastatal sugar factory in western Kenya. Arkel ceased work on the project during the second phase due to the government's failure to make full payment. International arbiters ruled in early 1995 that Arkel was owed approximately $5 million. In November 1995, the government agreed to pay the amount in five monthly installments. This dispute was unusually complicated, in part because of repeated parliamentary allegations that the contracts were corruptly obtained. Kenya's judicial system is modeled after the British, with magistrates' courts, high courts in the major cities, and a court of appeal. In addition, there is a separate industrial court that hears disputes over wages and labor terms. Its decisions cannot be appealed. Property and contractual rights are enforceable, but long delays in resolving commercial cases are not unusual. The system is subject to political influence and corruption.
Kenya does not have a commercial code. The Export Promotion Council released in April 1998 a proposed Business Charter, however. It incorporates a Code of Practice for all business and commercial contracts. The proposal has not been widely promoted. Kenya does have a bankruptcy law. Creditors' rights are comparable to those in other common law countries. Monetary judgments are usually made in Kenyan shillings. The government does accept binding international arbitration of investment disputes with foreign investors. Kenya is a member of the International Center for the Settlement of Investment Disputes. It is also a party to the New York Convention of 1958 on the Enforcement of Foreign Arbitral Awards.
E. PERFORMANCE REQUIREMENTS/INCENTIVES
Investors in the manufacturing and hotel sectors are permitted to deduct from their taxes a large portion of the cost of buildings and capital machinery. All locally financed materials and equipment (excluding motor vehicles and goods for regular repair and maintenance) for use in the construction or refurbishment of tourist hotels are zero-rated for purposes of value added tax. The Permanent Secretary to the Treasury must approve such purchases.
Though formerly a higher rate was applied to investments outside the cities of Nairobi and Mombasa, now there is one flat investment allowance of 60 percent. Another general incentive is the Duty Remission Scheme administered by the Export Promotion Programs Office in the Ministry of Finance. Materials imported for use in manufacturing for export or for production of duty-free items for domestic sale qualify. Approved suppliers, who manufacture goods to be supplied to the exporter, are also entitled to the same import duty relief.
Special incentives exist for qualified investors under the Manufacturing Under Bond (MUB) program and the Export Processing Zones (EPZs) Authority. MUB investors receive duty and value added tax exemption on imported plant, equipment, raw materials and intermediate inputs. They are also entitled to an investment allowance of 100 percent on immovable fixed assets. Investors in the EPZs enjoy duty and VAT exemption on imported machinery and raw material inputs; a ten-year corporate tax holiday; exemption from withholding tax (on dividends payable to non-resident shareholders) and stamp duty; exemption from certain industrial regulations and single licensing. Most new investors prefer the EPZs because they also provide power and water as well as support services.
With the exception of the insurance and telecommunications sectors and other infrastructure and media companies discussed earlier, Kenya does not require that its nationals own a percentage of a company. For insurance companies, at least one-third of the controlling interest, whether in terms of paid-up share capital or voting rights, must be held by citizens of Kenya. In the telecommunications sector, at least 60 percent equity must be owned by Kenyan nationals. In other sectors, joint ventures are encouraged but not mandatory. The percentage of foreign equity need not be reduced over time. Technology licenses are, however, subject to scrutiny by the Kenya Industrial Property Office (KIPO) to assure that they are in line with the Industrial Property Act. The goal is to obtain new technology and know-how. Licenses are valid for five years and are renewable. This function of KIPO is under review. Foreign investors are free to obtain financing locally or offshore.
The government no longer steers investment to specific geographic locations. Local content rules are applied but only for purposes of determining whether goods qualify for preferential duty rates under the Common Market for East and Southern Africa. Kenya has replaced its old policy of import substitution with one of export promotion. Employment of Kenyan nationals is strongly encouraged. In fact, the Immigration Department requires that a minimum of Ksh 3 million (approximately $42,000) be invested before it will authorize work permits for foreigners. The Investment Promotion Center is more flexible. Its minimum is Ksh 2 million (approximately $28,000). Exceptions have been made. Foreign employees are expected to be key senior managers or to have special skills not available locally.
F. RIGHT TO PRIVATE OWNERSHIP AND ESTABLISHMENT
Foreign and domestic private entities have a right to establish and own business enterprises and engage in nearly all forms of remunerative activity. The principal exceptions concern public utilities (infrastructure) and the media. Recent energy sector reforms have provided limited opportunity for private power generation to fill in a national power deficit. By statute, manufacturing companies are not permitted to distribute their own products. In addition, local officials have used their licensing authority to ensure the retail trade is mainly in the hands of Kenyans. Private enterprises can freely establish, acquire and dispose of interests in business enterprises.
In general, competitive equality is the standard applied to private enterprises in competition with public enterprises. Nevertheless, certain parastatals have enjoyed preferential access to markets: Kenya Reinsurance, for instance, has a guaranteed market share (although it is being phased out, and there are plans to privatize the parastatal). Kenya Seed Company continues to face fewer barriers in marketing than its foreign competitors. Easier access to cheap government credit is another advantage from which some state corporations have benefited. The National Oil Corporation of Kenya, for example, is developing a retail marketing operation using government funds. Certain parastatals have also been held to lower licensing standards. This was the case until recently with Kenya National Assurance Company (KNAC). KNAC had been insolvent for at least five years, yet it was permitted to do business until June 1996.
G. PROTECTION OF PROPERTY RIGHTS
Secured interests in property are recognized and enforced. In theory, the legal system protects and facilitates acquisition and disposition of all property rights -- lands, buildings and mortgages. In practice, obtaining title to land is a cumbersome and often corrupt process. It is frequently complicated by improper allocation to third parties of access and easements. That many of the 99-year government leases covering much of Kenya's urban land are expiring is another extenuating factor as is the general unwillingness of the courts to permit mortgage holders to sell land to collect debts. Furthermore, foreigners may require presidential approval to acquire large tracts of agricultural land or any seashore property.
Protection of intellectual property -- copyrights, patents and trademarks -- is inadequate. Piracy of audio and videocassettes is rampant. About $3.5 million is lost every year as a result of illegal software being used, according to the Business Software Association ö a computer industry association established to protect software copyrights and to prevent software piracy. The software piracy rate in Kenya is about 90 percent. The most prevalent form of software piracy in Kenya involves business use of unauthorized copies. Kenya is in the process of conforming its legislation to the WTO TRIPs Agreement. Patents, trademarks and trade secrets are the responsibility of the Kenya Industrial Property Office in the Ministry of Research, Technical Training and Technology. Copyrights are the responsibility of the Attorney General's office. Kenya is a member of most of the major international and regional intellectual property conventions. The Copyright Act was amended in late 1996 to provide protection for computer programs. Literary, musical and artistic works were already protected. Penalties for infringement remain low, and enforcement and the understanding of the importance of intellectual property are poor. Criminal penalties associated with software piracy in Kenya include a fine of up to SHS 200,000, a jail term of up to five years and confiscation of pirate operation hardware.
H. TRANSPARENCY OF THE REGULATORY SYSTEM
Kenyan regulations allow for the establishment of public and private corporations, as well as joint ventures and branches. Under the law, manufacturers may not distribute their own products, and they are required to supply information to the government about their distributors. The Government of Kenya has legislation to control monopolies and restrictive trade practices.
Private foreign investment in Kenya is governed by Kenya's Foreign Investment Protection Act (FIPA). The Act is being reviewed in light of recent liberalization of foreign exchange and import controls, and as a result a number of provisions are no longer applicable. For example, the previous requirement that foreign investors apply for a certificate of approved enterprise from the Treasury that allowed them to repatriate capital and profits has been removed. There are no formal requirements on minimum local participation in either equity or management under FIPA.
Foreign investors are required to sign an agreement with the government stating training arrangements for phasing out expatriates. Expatriate work permits are increasingly difficult to renew or acquire. Government approval for ventures in agriculture, distributive trade, and small-scale enterprises have become more difficult to get as the government seeks to indigenize these sectors.
There are no special requirements imposed on foreign investors. All investors (foreign and local) receive the same treatment in the initial screening process. The government screens each private sector project to determine its viability and implications for the development aspirations of the country. For example, a rural agro-based enterprise, with many forward and backward linkages, is likely to receive licensing fairly quickly. However, new foreign investment in Kenya has in the past been constrained by a time-consuming and highly discretionary approval and licensing system that has been vulnerable to corrupt practices. To counter this, the government amended the Investment Promotion Center Act in September 1992 to require the Center, through its "one-stop-office", to process applications for foreign investors within one month.
Despite the changes in 1992, the process still does not work well. The Government of Kenya has proposed, therefore, to adopt a new investment code which will cover local and foreign investment and govern the Investment Promotion Center. The code is expected to set clear guidelines for processing investment applications and will incorporate the means to ensure transparency and accountability. It will provide information on various incentives to investors, including the procedures for obtaining such information, and how the incentives are implemented. At present, the IPC lacks proper authority to implement many available incentives and procedures.
Incoming foreign investment through acquisitions, mergers or takeovers is governed by antitrust legislation that prohibits restrictive and predatory practices that prevent the establishment of competitive markets. The legislation is also aimed at reducing the concentration of economic power by controlling monopolies, mergers and takeovers of enterprises. Mergers and takeovers are subject to the Companies Act, the Insurance Act (in case of insurance firms) or the Banking Act (in the case of financial institutions).
The Government of Kenya launched a privatization program in 1991, in which 207 enterprises were targeted for privatization. As of September 1998, the Government of Kenya had divested from 165 public enterprises. Plans to privatize two large sugar companies and the Kenya Reinsurance Company are currently in the works. Senior officials - both government and non-government - have repeatedly stated that Kenyans should be given higher priority in the privatization exercise. Divestiture through public share issues provides little opportunity to corporate investors. In past divestitures, the Capital Markets Authority has seen to it that shares are thinly spread over many applicants thereby ruling out the possibility of a foreign investor acquiring a big stake in a company. However in the privatization of Kenya Airways, a foreign company acquired 23 percent of the shares as a "strategic" investor in the airline.
Under a World Bank export development program, the Government of Kenya has abolished, except for a few categories, export-licensing requirements and initiated three export incentive schemes for both local and foreign investors. It provides import duty/value added tax remission to importers of raw material inputs used for manufacture of exports. In addition, the Government of Kenya has an Export Assistance Scheme and an Export Development Support project, both of which provide grants for export promotion including export market studies and seminars. Manufacturing under bond facilities and export processing zones also exist.
In 1990, the Government of Kenya strengthened the law on health and safety in factories. The revised act authorizes the Labor Minister to undertake formal investigations of occupational accidents and disease. Factories that employ over 20 employees are required to have a safety and health committee. The Government of Kenya also has established a National Advisory Committee on Occupational Health and Safety and an Occupational Health and Safety Fund.
I. EFFICIENT CAPITAL MARKETS AND PORTFOLIO INVESTMENT
Kenya has a small capital market consisting of the government controlled Capital Markets Authority, one securities exchange (the 39-year old Nairobi Stock Exchange), 20 securities and equities brokerage firms, and 12 investment advisory firms. The NSE trades in stocks from 62 publicly quoted companies and had a market capitalization of Ksh 129 billion ($1.8 billion) by the end of 1998. The daily volume of trade varies from Ksh 10 million ($140,000) to Ksh 30 million ($422,000), involving an average of about 340 transactions. In 1994, the NSE, which operates on an open-cry system, moved into a modern facility.
There are plans to introduce another board to encourage listing by smaller companies and startups. At present, only Kenyan companies are permitted to list. Activity at the NSE has been diversified through trading in commercial paper and corporate bonds issued by private companies. Trading in these debt instruments is regulated through a set of guidelines that were issued by the Capital Markets Authority in June 1997. The guidelines were developed in collaboration with the private sector. They allow private companies to raise funds from the public without being quoted on the NSE. Beginning April 1997, secondary trading of floating rate Treasury Bonds also began in the NSE. A Central Depository System (CDS) for Government securities exists. This has encouraged the development of a secondary market for the Governmentâs one-year floating rate bond. The CDS has also opened a shop window for small investors with less than the Ksh 1 million minimum requirement to invest, in multiples of Ksh 50,000. Independent rating of companies operating in the money and capital markets is encouraged. Expenses related to credit rating services by listed companies and other issuers of corporate debt securities are tax deductible.
Since 1995, foreign companies can buy stocks not exceeding 40 percent of a listed company's total quoted shares; foreign individuals may purchase up to 5 percent. This means that in practice relatively few blue chip stocks are available for purchase by foreigners since most of them are already foreign controlled (more than 50 percent). In keeping with spirit of East African Cooperation, a Memorandum of Understanding was signed in March 1997 to establish the East African Securities Regulatory Authority. The Authority will be the central body charged with coordinating regional developments of capital markets.
Credit is allocated on market terms. In the early 1990s, politically well-connected banks received loans from the Central Bank at concessionary rates for little or no security. These abuses ended with the appointment of a new Central Bank Governor in 1993. Changes to the Banking Act proposed in June 1998 budget seek to ensure more accountability for bank directors. Beginning in January 1999, directorsâ loans are now set at market rates of interest. Such loans are disclosed in banks' audited accounts. Foreign investors are able to obtain credit on the local market. The number of credit instruments is relatively small. Legal, regulatory and accounting systems are generally transparent and consistent with international norms. The Central Bank of Kenya Act has been amended to provide security of tenure to its Governor, to increase the Bank's operational autonomy, to strengthen its bank supervision functions, and place statutory restrictions on government borrowing from the Bank.
In 1997, the total assets of Kenya's four largest banks -- -Kenya Commercial Bank, National Bank of Kenya, Barclays Bank Kenya, and Standard Chartered -- was Ksh 198 billion, or $2.8 billion at current exchange rates. This represents 52 percent of total assets of all the 48 commercial banks. This uneven distribution of market share has hindered competition in the sector. Asset quality of Kenyan banks is poor, and is deteriorating. In early 1999, the proportion of non-performing loans to total assets was 30 percent. A significant number of Kenyan banks are struggling, including the National Bank of Kenya, which in 1999 had to call on the government for assistance. The banking problems in Kenya are the result of poor bank management, inadequate government supervision, political pressure to make loans that are rarely repaid, and current economic conditions.
The banking system has weathered several crises intact, including high inflation rates early in the nineties. By the end of May 1998, all non-bank financial institutions and 26 (or 54 percent of all) commercial banks had less than the statutory minimum capital base requirement (by end of 1999) of Ksh 150 million and Ksh 200 million respectively. These institutions face daunting tasks of increasing their capital base to the required minimum in time. Most of the institutions will have to merge to meet this requirement. In 1994-96, Kenya's finance companies converted into banks (at the Central Bank's direction). Effective July 1998, commercial banks and other deposit taking institutions were required to observe a fortnightly 14 percent cash ratio, subject to a daily minimum of 11 percent. This requirement has often been exceeded in the past. Clearinghouse has completed the Magnetic Ink Character Recognition (MICR) system that was initiated in 1996 to speed up the clearing of checks. Despite this modernization, check-clearing process has not quickened significantly. Both residents and non-residents are allowed to operate foreign currency accounts.
"Cross-shareholding" and "stable shareholder" arrangements are not used to restrict foreign investment through mergers and acquisitions. Removal of taxes on sales of stock held as an investment by insurance companies in the June 1997 budget boosted turnover on the exchange. Hostile takeover defenses are uncommon. Expenses related to credit rating services by listed companies and other issuers of corporate debt securities are tax deductible. Private firms are free to adopt articles of incorporation which limit or prohibit foreign investment, participation or control. Foreign participation in industry standards setting organizations is welcomed. No other practices by private firms exist to restrict foreign investment.
J. POLITICAL VIOLENCE
There have been several clashes in the recent past between police and demonstrators over political reform and other issues. Although some shops in major cities, notably downtown Nairobi, have been damaged or looted during recent disturbances, the damage has been limited and not directed at foreign companies. In August 1997, ethnic violence hit Mombasa and other nearby areas on the coast. Most damage was done to property owned by non-coastal Kenyans. Tourists and foreigners were not targeted. Kenya enjoys good relations with all its immediate neighbors.
The terrorist bombing of the U.S. Embassy in August 1998 was the result of transnational terrorism and unrelated to domestic Kenyan issues.
K. CORRUPTION
Kenya has adopted laws to combat corruption. The Prevention of Corruption Act was amended in late 1997 to create the Kenya Anti-Corruption Authority (KACA). A Director, who is appointed by the President, but has security of tenure, heads the Authority. KACA is established as an independent body by an Act of Parliament. It has wide-ranging powers. For example, the Director can take over cases of corruption from the police, and its employees have powers similar to those of the police. They are empowered to launch investigations, seize documents and other evidence, compel witnesses or suspects to testify, and to arrest and prosecute. Vigorous enforcement of the law by the KACA has been lacking, however. KACA got off to a poor start when its first Director was sacked in 1998. President Moi appointed a new Director in March 1999. Although annual reports of the Controller and Auditor-General and the Auditor-General for Corporations have identified specific areas of corruption in the financial accounts of ministries and parastatals, little action has been taken. The same is true of the reports of the two parliamentary watchdog committees that review these findings. Anti-corruption efforts would be strengthened by the adoption of legislation requiring, for example, public officials to disclose their assets and barring them from making decisions on issues where they have a conflict of interest.
U.S. firms have identified corruption as a major obstacle to foreign direct investment. Corruption is pervasive in most sectors, particularly in government procurement and dispute settlement. A police unit was recently established at the Kenya Revenue Authority to tackle tax evaders, including scandals involving duty evasion at the Port of Mombasa. In the 1980s, corruption was one reason so many U.S. companies disinvested. There has been slow progress in fighting corruption. In an ongoing case, three former senior Kenya government officials and a Nairobi businessman and his firm have been accused of stealing Ksh 5.8 billion ($82 million) belonging to the government in 1993. The case is part of a massive financial scam in which the Central Bank and Treasury lost over Ksh 21 billion ($400 million at average exchange rate of the period) in the early 1990s.
L. BILATERAL INVESTMENT AGREEMENTS
Kenya signed a bilateral trade and investment agreement with Germany in 1996. According to the Investment Promotion Center, agreements are pending with the United Kingdom, Italy, and Russia. There is no BIT with the United States.
M. OPIC AND OTHER INVESTMENT INSURANCE PROGRAMS
The U.S. Overseas Private Investment Corporation (OPIC) has one project in Kenya under its Africa Growth Fund that provides some equity investment. There is certainly potential for more OPIC programs. Kenya is a member of the Multilateral Investment Guarantee Agency.
In addition, the U.S. Export-Import Bank is open to short and medium-term financing for government and private sector entities in Kenya.
The exchange rate of the Kenya shilling is market determined, and the U.S. dollar is easily obtainable from banks or foreign exchange bureaus. Average exchange rate in 1997 was Ksh 58.80 to $1.00. In 1998, the average exchange rate was Ksh 60.40 to $1.00. The average exchange rate for 1999 was Ksh 70.30 to $1.
N. LABOR
Kenya's estimated 2.6 percent annual population growth rate translates into a high demand for new jobs annually. In 1997, an estimated 1.2 million males and 473,400 females engaged in formal wage employment. In the formal sector, women worked overwhelmingly in services, men in agriculture, education, manufacturing, building and construction, trade, and transport. The highest percentage of female formal sector workers was in education, where women constituted 40 percent of the total work force. About one-quarter of the women worked in this area, but only 15 percent of men. Women also constituted more than 25 percent of the work force in finance, insurance, and other business services and over 29 percent in public administration and agriculture. Women, however, staff some textile factories almost exclusively.
The informal sector, known as jua kali, employs approximately 64 percent of all Kenyan workers and, thus, plays an important role in Kenya's economy. Indeed, a report by a Kenyan think-tank, the Institute of Economic Affairs, shows that the informal sector is the most dynamic in the economy in terms of job creation, accounting for about 90 percent of new jobs outside the smallholder farm sector. Examples of informal sector business activities include carpentry, motor vehicle repair, tailoring, and small-scale manufacture of spoons, cooking pans and ovens. The Government of Kenya and donors are striving to improve working conditions and infrastructure in the informal sector. However, there often is a gap between government policy and implementation.
Kenya's laws provide many safeguards and benefits for workers, with mechanisms and procedures to address complaints relating to worker rights. The normal work week is 40 hours, after which overtime must be paid. Kenya also has a minimum wage scale for twelve different categories of employees. In addition, benefits, ranging from housing to home transportation allowances, account for 25 to 50 percent of a Kenyan worker's compensation package. Kenyan law establishes detailed environmental, health, and safety standards that are not strictly followed in practice.
O. FOREIGN DIRECT INVESTMENT STATISTICS
Kenya does not keep data on the value of FDI (position/stock and annual investment capital flows) by country of origin or by industry sector destination. Neither is data available on Kenya's investment abroad. It is however estimated by the Investment Promotion Center that by 1994, cumulative foreign direct investment totaled more than $1 billion.
More than 200 foreign companies are registered in Kenya, the majority from United Kingdom, Germany, and the United States. A list of some large foreign investors currently operating in Kenya is as follows:
COUNTRY COMPANY OF ORIGN PRODUCT Agip Italy Petroleum products BASF Germany Chemicals/plastics BAT Industries UK Tobacco/cigarettes Bata (K) Ltd. Canada Shoes Bayer AG Germany Pharmaceuticals British Oxygen UK Industrial gases British Petroleum UK Petroleum products Cadbury Schweppes UK Confectionery/beverages Caltex Oil USA Refinery products Cementia Switzerland Portland cement Ciba Geigy Switzerland Pharmaceuticals CMB Packaging France Metal packaging Coca-Cola USA Beverages Colgate Palmolive USA Hygiene products CPC USA Corn products General Motors USA Vehicle assembly Glaxo UK Pharmaceuticals Hilton Int. UK Hotels Hoechst AG Germany Industrial chemicals Intercontinental Hotel Japan Hotels Lonrho PLC UK Motor/vehicles/hotels/farming livestock/meat/newspapers/transport Mitsubishi Japan Motor vehicles Mobil USA Petroleum products Nestle Switzerland Milk products and beverages Orient Paper Mills India Paper products Raymond Woolen Mills India Textiles Safari Park Hotel South Korea Hotel Shell UK Petroleum products Sterling Winthrop USA Pharmaceuticals Sumitomo Corp. Japan Construction Total France Petroleum products Unilever UK Consumer goods/tea
|
[end of document] Note* International Copyright, United States Government, 1999. All rights under foreign copyright laws are reserved. All portions of this publication are protected against any type or form of reproduction, communications to the public and the preparation of adaptations, arrangement and alterations outside the United States. U. S. copyright is not asserted under the U.S. Copyright Law, Title 17, United States Code.
Next Chapter | Table of Contents
|
