Harassment of business must end now

Dec 04, 2005 Management, Sunday Nation

This country of ours still demonstrates an alarming propensity to shoot itself in the foot, regularly and with great accuracy. Over the past few months, we seem to have decided to mess around with the only group in the economy that keeps us afloat, through good times and bad: our businesspeople. Great shot!

Small, medium-sized and sometimes even large businesses are not being spared. Traders and manufacturers, dukawallas and kiosk owners, workshops and restaurants: all repeat the same story. There appears to be an agenda, staggering in its stupidity, to harass, hassle, pester and generally make life difficult for Kenya’s entrepreneurs.

The worst offender (a tag it tends to wear like some sort of perverse mission statement) is the Nairobi City Council. The NCC’s Inspectors have been strutting around like storm troopers, walking in and out of business premises at will on the pretext of enforcing the Council’s by-laws. All very good, you might think: laws are laws, and must be enforced. But listen to what businesspeople say is actually happening.

Should a shopkeeper step out of his shop to smoke a cigarette and commit the mortal sin of throwing his stub onto the pavement or even into a litter bin, there will be an NCC askari who will pounce on this unfortunate fellow and bundle him into a truck alongside pickpockets, muggers and assorted drunks, and then haul him around town for the rest of the day while more miscreants are scooped up like debris from the streets.

Should a businessperson want to visit a customer in town, he or she faces two unpalatable choices. The first is to drive in and look for parking. An hour later, having secured one of those spots which are as rare as gold dust, this law-abiding person will seek out one of those yellow-coated charlatans who purport to sell parking tickets. You know the rest of the story, it’s probably happened to you. No yellowcoat will be in sight. The businessperson will waste another half-hour searching high and low, and will then give up and rush to his appointment. The yellowcoats will now emerge from their hidey-holes, like termites after rain, and promptly clamp the car.

The businessperson’s second option is to take a driver and be dropped off in town. Ah, danger looms again. For if the car stops for even five seconds somewhere which is not “a designated dropping zone” to allow its passenger to disembark, a phalanx of officers will pounce to effect an arrest. As designated spots are known only to God and the Council, the chances of this happening to you are extremely high. In the meantime you will observe that protected species known as matatus stopping to scoop and deposit passengers wherever their fancy takes them – particularly smack in the middle of busy highways and roundabouts.

Then there is the renovations game. Businesspeople are not only required to paint their premises inside and out, some claim to have been fined for not changing table-tops! Many are even reportedly being asked to clean the pavement outside – a new form of “outsourcing” if ever there was one. If it is not the Council’s responsibility to clean the streets, whose is it? What next: that pedestrians will be required to carry brooms and sweep after themselves as they walk?

It is, without question, correct to have a set of by-laws that applies to businesses in any public environment. A supportive legal framework is, after all, what prevents us from descending into anarchy. It is also true that over the past two decades, as the systems and structures of governance have rotted away, there has been a culture of tax evasion and lack of compliance that has taken root.

But none of that excuses what we are seeing now. This is not compliance; it is oppression. What most often happens is that victims are bundled off to the cells as though they were rapists, and then given the choice of staying there or paying for their freedom. Even the yellowcoats that clamp your car are not doing it out of civic zeal: they will wish to negotiate a “private settlement”.

All we are doing is creating a new class of gatekeepers and extortionists, as though our battered economy was not running a surplus in that department already. Whose bright idea was it to give NCC people the power of arrest anyway? That genius has a lot to answer for. And the NCC as a paragon of virtuous law enforcement? Give me (and the business community) a break. To date it has not been able to find out who set its own premises on fire in early 2004. Giving this monument to corruption the power of arrest is like placing the walevi in charge of the brewery.

At the heart of this issue is a misconception. We claim that we are making ourselves an investor-friendly economy. We imagine that this involves hosting delegations of smart-suited foreign magnates and their advisors and holding workshops in five-star venues. We imagine that it involves poring over PowerPoint presentations containing 10-year projections. We imagine that it is about large-scale privatisations and billion-shilling deals.

We must stop imagining and learn to keep our eyes open. For the investments that drive our economy forward and provide livelihoods to millions are right under our nose. When those shopkeepers and kiosk-owners and artisans set up shop, they do many things for the economy. First, they inject new inputs into the national production process. Second, they create employment and introduce new purchasing power into the economy. Third, they (in most cases) pay taxes and provide the funds for roads and hospitals (and, regrettably, NCC goons). Fourth, they produce goods and provide services that improve the lives of consumers. And lastly, they (hopefully) make a profit and provide a pool of funds for new investment.

In short, a single small businessperson adds more value than a whole army of malevolent “enforcers” can do over a lifetime of misguided activity. Our heroes and heroines are the people who risk their savings and borrowings to set up value-generating businesses, not the parasites who seek to extort their earnings or shut them down.

An enlightened approach to business regulation and business-climate management is sorely needed. Sadly, the achievement of this enlightenment by the powers-that-be is less likely than prolonged rain in Ukambani. In these circumstances, businesspeople must themselves step forward.

It’s time to take the gloves off. We have a plethora of business associations in this country. Step one is for every one of them to ensure that its members are operating within every reasonable law and paying every reasonable tax. Armed with moral authority, the second step is to say “enough is enough”. If this absurd oppression continues, all the bets are off. Businesspeople must get together and complain incessantly and noisily. They must pool their funds and test all these arcane by-laws and regulations in court. They must be listened to by all the bodies that matter.

Failing that, they must be ready to exercise the ultimate sanction: a collective shutdown of business until sanity is restored. Then we’ll see who matters in the economy.