Missing files and Tender Entrepreneur Brokers

“The abuse of entrusted power for private gain is always fine for the one person doing it, but it becomes catastrophic if everybody starts doing it.” - David Pitt-Watson

Last night on the news, Kenyans got to witness Dorothy Angote, the Permanent Secretary in the Ministry of Lands leading what was a day-long graft busting raid on junior officials in her Ministry. The Ministry which handles nearly five million title deeds, has been continuously been named as being one of the top most corrupt public institutions in the country. For her efforts, the PS unearthed thousands of files that had been stashed, some of which had been “missing” since the 1990s.

Kenyans have long become used to the phantom menace called “missing” files. The ghost appears out of nowhere just when one needs to undertake a transaction with the government.

Anyway, Dorothy Angote’s impromptu raid at least saved some Kenyans from the cartel of rogue officers at the Lands ministry as well as what we shall politely call brokers, agents or tender entrepreneurs.

However, Ms. Angote’s prescription to the problem falls short of expectation when she announced that there would be a reshuffle and disciplinary actions for the errant officers. If the Lands Ministry was a private business, for sure at least there would have been mass summary dismissals, if not court prosecutions. To send a clear message, the punishment must be clear.

Kenya has not been alone in handling rogue brokers that encourage public sector corruption. South Africa has also been dealing with such brokers who because of their close connections to the political elite, seem to be amassing great wealth to the detriment of hard working entrepreneurs.

Bobby Godsell the chairman of Business Leadership South Africa was recently mentioned in the media calling for South Africans to stand up to tender entrepreneurs who benefited from state contracts.

He likened this business practice to "a form of economic terrorism" that imposes “a cost on state services and conferring no benefit”.

This came in the wake of allegations that the country’s ruling party ANC’s youth leader Julius Malema's who the BBC recently described “28, a little overweight, impeccably dressed, and rather fond of referring to himself with the royal ‘we’” had irregularly personally benefited from lucrative government contracts. However, Mr. Malema has denied accusations of unearned wealth by saying that he is merely the victim of a political conspiracy and a racist plot.

Indeed Malema is just another example of South Africa’s “bling culture” which has for some compromised ethical business behaviour. Entrepreneurs have had to be linked to a politically connected personalities in order to effectively compete on the public sector market.

Closer to home, business cronyism in the tender sector has led to great resistance each time the government tries to institute measures that will even out the information asymmetry when it comes to public procurement. 

As we mentioned almost two years ago, the broker sector in Kenya has also become a culture where:

“You need a middle man to manoeuvre public processes. For instance, if one goes to the companies, lands or court registries, you have to more or less fight your way to the front of the queue. Brokers have taken precedence and because they have managed to become acquainted with the public officers, they tend to get their work done first … “

And it is this lack of transparent systems and promulgation of red-tape that have been a boon for the broker community. The cost imposed on not just entrepreneurs but every taxpayer in muddling through bureaucratic systems is what ensures that brokers shall always be in demand. After all, the opportunity cost of giving a broker a facilitation fee and lunch money to ensure that your application is submitted or your file is found, is much less than the cost of having to leave your business in order to chase up the matter yourself.

Then there is the issue of business competitiveness which has also had an impact on the need to fast-track (at whatever cost) government procedures. Bending the rules and paying the occasional bribe just to get a process fast tracked or even to be awarded a contract are common dilemmas faced by today’s entrepreneur. Moreover if one is doing it, then you can bet that others just to stay ahead of the competition will also do so.

It has now become recognised that an important catalyst to business growth is enabling entrepreneurs to compete on the public procurement market. And it is encouraging that young entrepreneurs are taking on the bottlenecks in the public sector, and developing new applications that equalize information asymmetries and promote transparency whilst combating public sector corruption. One such business is Tenders Unlimited, a new Kenyan business startup that provides databased access to tenders to business people.

Reducing the opportunity costs of red-tape frees up resources for more productive activities as well as spurring wider economic growth. Thus computerization of government documents should be implemented.

And finally to put rogue brokers out of business, procedures that require in-person attendance should be minimised. As seen by the influx of mobile phone money transfer systems onto the market, banks are now joining the fray and offering mobile payment systems that will eliminate the need for people to stand in long queues just to get their bank statements. Without ZAP and MPesa, chances are that the traditional banks would not have brought banking services closer to the people.

Now we are asking the government to bring it’s services closer to us taxpayers too.

 

Youth 4 A Better Future: Say Little, Work Hard and Be Young Forever!

Youth 4 a Better Future Campaign is an ongoing environmental and social campaign that promotes market driven agriculture, enterprise development, environmental conservation and research.

It is an initiative of Maa Community Foundation, Health Awareness Peer Education Programme (HAPEP), IMPACT Kenya Youth Initiative, Tabaiki Sports Association, KEYFORD and STOMAZ.

Its main objective is to raise awareness on environmental, health, sports and entrepreneurship development.

Currently the project has a very successful solid waste management enterprise in Narok town, a bee keeping project, a digital village centre, a goat project, an organic tomato farm project, a tree nurseries project, a micro finance and woodlot project. The target is 100 of such enterprises by November 2010, and by 2013 the founder Ole Mepukori projects that there will be 500 successful social enterprises across Kenya.

Yipe.org recently got the chance to chat with Ole Mepukori who said that he started in 2008, but opened doors to his friends who brought in their friends and so it went.

Right now the project has youth groups from really remote areas selling their goats at a profit to markets as far as Mombasa. “Yes” Ole Mepukori told Yipe, “we want all Kenyan youth to come join us and in ten years we will all look back and say, ‘we helped build Kenya’".

Ole Mepukori adds that the project is not only limited to young people, as he believes everybody has something to offer for the advancement of this cause, and even if that person is an eighty year old granny they can also play a vital role.

He concludes “Lets believe, say little, work hard and Be Young Forever!”

If you are interested in being a Youth 4 a Better Future join the community here >>>>

Women and Mobile Phone global study reveals that phone ownership can lead to increased income and opportunity

The GSM Association and the Cherie Blair Foundation for Women, a charity that supports women entrepreneurs has published a report ‘Women and Mobile: A Global Opportunity’. 

This is the first detailed global study of its kind that attempts to understand the nature of women mobile subscribers in low and middle-income countries such as Kenya and India. 

Among the key findings, the report showed that:

• There are 300 million fewer female subscribers than male subscribers worldwide
• A woman in Africa is 23% less likely to own a phone than a man.
• Going forward, two thirds of potential new subscribers for mobile network operators will be women.
• Women in rural areas and lower income brackets stand to benefit the most from closing the gender gap.
• 93% of  women report feeling safer because of their mobile phone.
• 85% of women report feeling more independent because of their mobile phone
• 41% of women report having increased income and professional opportunities once they own a phone  
  

Read more

Where nobody needs to work or study hard anymore

An article published in this week's Pambazuka raises issues about policies to promote economic development.

The article, “South Africa’s ‘bling’ culture is a disgrace” by William Gumede tells of a growing new-money class, living a Hollywood-esque life in the midst of poverty.

He writes that this bling lifestyle of parties and fast flashy cars amongst South Africa’s elite, is encouraging others to look for the fast buck, rather working hard or studying.

Even the leaders have joined this new life, with no less than President Zuma’s party the ANC launching a fashion line of leather jackets; the cheapest costing US$ 217.

All this social pressure to live the bling life has for some compromised their integrity and ethical business behaviour because of links to sugar daddy’s, senior politicians and even crime bosses.

Gumede faults South Africa’s Black Economic Empowerment (BEE) programme as having contributed to this state of affairs. Because one does not have to build a business brick and mortar, entrepreneurial drive has been culled. 

And even for those that have slogged to build their enterprises, corruption in the big business market of public procurement has only benefited a few well connected entrepreneurs.

And Gumede warns that “this ‘bling’ culture will break down South Africa’s productive capacity. We are ‘eating’, but we are not building any new factories or plants that can create jobs …”

Lamentably for the young aspiring entrepreneur, it seems that it may be more worthwhile to try and connect with a blinged elite patron, than to put pen to paper and write their business plan.

Read South Africa’s ‘bling’ culture is a disgrace here >>

African youth declare that governments must foster entrepreneurship to eradicate poverty

The 1st World Youth Meeting at Bari, Italy ended yesterday where African delegates released a Declaration that recognised the challenges African youth face including unemployment, corruption,  poverty, lack of access to meaningful education, climate change effects, and civil wars among others.

The Declaration further demanded that African youth be included in decision making and that poverty eradication approaches focus on entrepreneurship development, specifically through the creation of youth funds.

Read the Declaration here

Entrepreneur Profile: Josphat Karinga

Josphat Karinga is the Technical Director of Ristech Solutions a Kenyan company he founded in 2003. The company provides a wide array of services for individual and business clients, including assisting them to overcome the obstacles of bureaucracy in the application for government documents, courier services and car rentals. 

 

Yipe.org recently got a opportunity to briefly interview him where he also gave some useful tips on maintaining good customer relationships.

Read the interview here

Entrepreneurship - Kenya's Economic Saviour

By Jeconia Omondi Olonde

The current economic condition for Kenya is on a down hill while the population growth rate is quite high. This implies there is an increase in unemployment as the new jobs created cannot match the increase in population. A situation is created where the youth are finishing university, college and secondary school expecting to be employed yet the economy cannot accommodate them. This will in the end bring social instability especially with the high cost of education.

But what can the government and the private sectors do to help alleviate the situation that may bring the country to its knees? An initiative such as the Kazi Kwa Vijana was started by the government and has ended as a failure, taking the country back to the maze. The Kazi Kwa Vijana could not have been sustained as we can say the jobs given to them “do not add value” to the economy and the government is spending a huge amount of money in paying recurrent expenses. Also some of the jobs given may seem demeaning to some of the unemployed graduates. Telling an engineering graduate to clean trenches shows that the government has no plans for its citizens who are meant to be assets.
 

Further, unemployment situations in Kenya have been increased by the high requirements by employers in order to get jobs. Requirement of years of professional experience for jobs in Kenya has made it difficult for the fresh graduates to get jobs and their Kenyan dream of finding that dream job after years of education.
 

For the country to be able to create employment, the government and the private sector should highly consider embracing entrepreneurship as a source of expanding the economy and reducing poverty. With the shift towards technology, the government can use the youth to enhance and come up with new technologies which will help accelerate growth and achieve Vision 2030.
 

Some of the ways in which the government can do to help youth embrace entrepreneurship are:

• Providing financial assistance and guidance. Many youth have good business ideas but translating these to actual jobs is hindered by lack of knowledge of transforming ideas into feasible and tangible work. Also financial guidance on how to spend the initial finance is necessary as the projected financial statements are is not enough, for example, purchasing of essential assets, marketing and branding, establishing of internal business controls, and book keeping.
• Providing mentors to the youth who come up with good business ideas or proposals. The mentors are used to guide the youth especially through the tough times as they have been in the business before and they know what to do best in such situations.
• Introducing entrepreneurship as a subject in schools so that the students are able to know early enough how to start their own businesses and succeed. Mentality of students has to be changed from them expecting employment for them to create employment. This should be done for both students in professional courses and those in vocational training. In the earlier years, it was preached in radio stations and songs that at the end of education one will get a good job and this mentality has stuck in the mind of the population. We should therefore start changing the minds of people with regards to this.
• Providing tax incentives for young entrepreneurs who provide employment to others. There are difficulties involved with business start ups and therefore the government should recognize this effort by giving the youth tax incentives. This has been done to Export Processing Zones (EPZs) to attract foreign direct investments. Local investments should also be considered important as this brings more stimulus to growth as there are no profit flights.
• Patenting of special business ideas created by the young people. This may reduce the chances of the ideas being stolen by other capable individuals or by corporations. Good ideas are known to have been submitted to “wrong” organizations which take advantage of the weak protection laws of ideas. These weak laws demoralize the young people with brilliant ideas who may opt to stay with the ideas for long until they are able to finance themselves. Developed countries are known to have proper laws protecting ideas created by its citizens and developing countries should follow suit.
  

These are only some of the things the government should take into consideration if it has to help the country become entrepreneurial. The effect of citizens creating job opportunities in the economy cannot be over emphasized and the government has to act fast to improve the livelihood of its citizens.