KenInvest: administrative transparency fosters investment

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The Kenya Investment Authority (KenInvest) has taken several measures to promote transparency surrounding investment-related procedures in an effort to attract more investments to Kenya. One approach to accomplish this goal has involved the implementation of an investment information portal called eRegulations (http://kenya.eregulations.org) that simplifies the investment process and clarifies its rules. With the support of the Government of Netherlands and the technical assistance of UNCTAD, this portal, which launched in December 2015, is bringing several advantages for both investors and public institutions and has created an improved network of communication that is benefiting the investment landscape in Kenya.

Benefits for Investors
KenInvest’s online portal provides a comprehensive guide to the country’s investment-related procedures. The portal ensures complete transparency on administrative procedures for investment by presenting all application steps for various investment activities such as business creation, construction and taxation in singular easily accessible location. The procedures are explainedstep-by-step from the investor’s perspective: where to go, what requirements to fulfill including forms, the associated costs, relevant legal justifications and officials to contact in case of a problem.
Clear and complete information on procedures streamlines their completion – investors do not have to research information from multiple sources – reducing barriers to entry to investing in Kenya and to subsequent business operations. As of January 2017, the portal describes 89 different procedures that relate to investment, clearly explaining how to carry out each step associated with them. Around 400 steps – defined as any interaction between an investor and an administrator – with downloadable links to more than 950 forms and sample documents are now accessible online. KenInvest is continuously working with a network of government focal points to update the database of procedures and to expand its reach to more domains such as, for example, banking, agriculture or telecommunication regulations.

 

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Benefits for the Government
In addition to the benefits investors enjoy, KenInvest is becoming better at investment promotion and facilitation. Due to the portal providing clear instructions to investors, it is helping the Agency reallocate its resources more efficiently. Officers previously overburdened by investor queries can now simply direct investors to the appropriate place online for recurring and standard questions on procedures. This not only helps investors get the information they need more effectively, it helps officers free up their time for more value-added assistance to investors who need more case-by-case and customized support.
Moreover, because the portal documents all investment procedures in detail, it gives administrations an overarching view of the registrations from the investor’s perspective. This oversight allows governmental organizations to analyze and reflect on their processes, leading to identifying simplification measures that improve service delivery. Lately, KenInvest’s eRegulations team has been working hand in hand with the Kenya Business Registration Service and the eCitizen program to improve the user experience of the newly established online system. By applying the system’s analysis and simplification methodology, unplanned hurdles – such as the need for a foreigner registration number that impaired foreigners’ ability to register their businesses through Kenya’s newly launched business portal – were identified by the eRegulations Team and subsequently removed together with the system’s managers.

Such positive spillover effect of KenInvest developing the portal is also exemplified by other government agencies inspired to adopt similar approaches to their own and their customer’s benefit. The Ministry of lands, which is mandated to authorize and register land transactions, has streamlined its procedures applying the portal’s principles. It is now working with KenInvest to offer key administrative procedures online such as land rent payment, land search, and stamp duty payment.
Similarly, the Trade Portal project is also is built on the experience of KenInvest. Launched at the UNCTAD 14 Conference in July 2016, the portal, implemented by the Kenya Trade Network Agency (KenTrade) aims to document all export, import and transit procedures in Kenya. This helps Kenya comply with the obligations of the WTO Trade Facilitation Agreement by offering full transparency on rules and regulations surrounding external trade operations. The portal’s layout and methodology is likely to be adopted by more government agencies who are increasingly eager to improve their online information and to become more service-minded.

The portal is also helping the Kenyan government by empowering citizens against corrupt officials. Citizens and investors, aware of their rights (cost, timeframe, requirements which are certified by the relevant authorities), are less likely to be pressed to offer bribes in order to obtain various licenses in a timely manner. The portal allows users to report problems and complaints online if they witness unlawful or irregular behavior. In addition, investors are also able to understand the reasoning behind government procedures as they are accompanied by legal justifications. In the event of a step not being legally backed, the government officials can easily identify it and have it removed. The expectation that each step must be justified by law is strengthening transparency and accountability in government services.

A communication network for investment facilitation and promotion
In addition to helping investors and administrators, the portal has created and relies on a communication network bringing further advantages. The portal is receiving an increasing number of comments and suggestions from the public, improving public-private dialogue surrounding investment. In 2016, more than 100 suggestions were formally lodged and taken into account by KenInvest, and the number of contributing users keeps rising as the system is being disseminated through search engines and other communication channels. Such feedback loops allow users’ voices to be heard and facilitate the implementation of their suggestions. They are enhancing punctuality of service; citizens can increasingly count on agencies actually delivering the services they promise, by strengthening, for instance, the respect for the durations set forth on the eRegulations portal, users being able to file complaints if delays are experienced.
Another benefit of the eRegulations portal is to increase communication between KenInvest and its partner governmental agencies. The implementation of the portal has led to building a network of focal points among all institutions involved in maintaining the databases updated. This same network, in turn, allows KenInvest to assist investors faster in overcoming administrative problems and to disseminate the newest information quickly by knowing exactly who to contact within the numerous agencies involved in regulating investment.

KenInvest is gaining in popularity domestically and globally as an Investment Promotion Agency thanks to its eRegulations system and its quick responses to investor inquiries. On the Global Registration Index (ger.co) – which ranks government’s efforts to provide comprehensive information on business startup, Kenya is now receiving top marks collecting 10 out of 10 points for its information portal on business registration, part of eRegulatins Kenya. Despite only being active for one year, the portal is attracting an increasing number of visitors. In 2016, the website recorded 75,615 visits, rapidly becoming the most visited eRegulations portal in Africa.

Other Investment Promotion agencies interested in offering similar online services to their users should contact KenInvest or UNCTAD who can offer advice and assistance to develop an eRegulations project. In Kenya, the first iteration of the system went live only 1 year after the project started, but KenInvest continues its work documenting procedures, encompassing ever more areas of business, and detecting and implementing new simplification measures. The main investment of such a project concerns not the system – which can be installed rapidly and as a cost as low as USD 50’000 – but the data collection process on procedures, which requires a minimum of 2 trained researchers and a project manager to coordinate the numerous field visits with all institutions involved in investment promotion. The main challenge is to obtain all information at first and, then, to keep it updated – as stated, this requires broad institutional buy-in and the capacity to sustain a committed network for transparent service delivery.

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