Business in Kenya; the free fall of the dollar against the Shilling
The free fall of the shilling against the dollar has drastically affected the lives of ordinary Kenyans, and has greatly challenged the viability of healthy opportunities of Business in Kenya. The shilling tumbled to a low of 95.10 against the dollar last month.
The Government must do something and it must act pretty fast, to save many affected Kenyans who are depending on the strength of the dollar as a daily sacrilege. The Kenyan shilling is said to be amongst the worst performing currency, after neighboring Uganda’s shilling, the Maldives rufiyaa and the Suriname dollar. What is happening in this wonderful country!!!!, if its not post election violence, it is famine, or a fire tragedy, a misbehaving shilling, road carnage, lethal brews, God in heaven what next!?
Kenya must seek monetary support to spur Business in Kenya
The Kenya Government must strategically negotiate with the International Monetary Fund and other International financial institutions to seek support for the ailing shilling. The weak shilling has made the existing Business in Kenya very costly and discouraged new investors to consider initiating Business in Kenya. It has affected majorly the imports sector which has become very expensive.
The cost of living has been constantly rising and shooting up fivefold in just 12 months. Recently while addressing, investors at the Nairobi Stock Exchange, President Mwai Kibaki indicated that the Government had asked for additional cash under the extended credit facility.
All quotas and sectors of the Business in Kenya are feeling the heat and the pressure. This has put the Central Bank of Kenya in a dilemma to seek for solutions on how to deal with the currency’s turbulence, rooted in monetary and fiscal economic policy. The think tanks in the world of Business in Kenya should also be part of the solutions rather than the problem.
It was imperative for the President to also direct financial regulators to deal firmly with speculators, who may want to take advantage of the overbearing and stumbling financial market for selfish interests. Kenya has an open market policy, which dictates Business in Kenya.
The cost of living has been equated to the high prices of fuel. Kenya is a fuel importer and any significant price changes affect the cost of production and manufacturing. The annual inflation rate was about 7.9 per cent in July 2011, at its highest level this year. This is according to the Kenya National Bureau of statistics.
Safaricom a leader in Business in Kenya hints of a price rise
Kenyans are a really unlucky lot, being hit left, right and center. With the cost of living rising each fortnight with fuel and foodstuffs sounding a death bell, now the cost of making phone calls being hinted to rise, places the already injured Kenyans in a limbo.
Recently, Mr. Bob Collymore, the chief executive of one of country’s largest mobile operator and Business in Kenya, Safaricom, said telecommunication companies had been struggling to absorb the rising operation costs due to high inflation and a weak shilling, constantly making imports extremely expensive. “Its simple economics as the cost of operations has been going up,” he said.
It’s important to know that Safaricom subscribers have been enjoying relatively lower calling rates since the entry of Airtel into the market. Safaricom has in the past complained of erratic power supplies and the cost in rising fuel. Safaricom controls about 70 percent of the more than 20million subscribers. This shows that Safaricom is a force in the economics of Business in Kenya.
Other countries in the East African community operators could be raising their tariffs as local currencies fall against the dollar. This is an EAC community challenge, since joint trade ventures are highly at stake.
Business in Kenya will enjoy sanity of Political maturity
Political juggling and politicization of almost everything, has been like a poisonous spider inside our shoes. Business in Kenya can’t record sterling records. It wouldn’t reinvent a new model of consistency in best growth, if political sycophancy, bigotry and continued impunity are still embraced in our political leadership and systems. However with a favorable constitutional dispensation that protects Business in Kenya there is great hope.
Business in Kenya is motivated by entry of new investors in our industries. The economic growth that is devoid of political polarization and impunity is likely to attract a window of new Business in Kenya.