Wednesday, April 30, 2008

Sleeping giants may never wake (or reform)

labour on Labour Day
Sometimes I wonder if we are ever going to reform & develop, or if by being profitable and making money we see no need for some reforms - corporate, land, ICT, political or other.

Rwanda is on the fast path to being an ICT powerhouse. They may get there, but we have the beach, undersea cable etc. - all we have to do is wait to benefit from them. Uganda and Sudan have oil – but so what? It will have to pass through here.

Stanbic Uganda [Pre tax profit of 69 billion ($41 million) [up 37%] and a dividend of Ug. 6.64 shillings per share (up 10%)] is able to e-mail to shareholders their annual reports, AGM notices, and proxies; meanwhile many Kenyan companies talk about it, have amended their by-laws to enable it, but I'm yet to see it done (any examples? - but maybe having 1 million expensive shareholders will entice them to take the next step forward).

In Uganda, empty plots display their legal numbers and have some sequential order by street; here in Kenya L.R. no’s (the official designation of parcels of land) only appear in court documents/mentioned in scandals and are only understood by estate agents.

In Uganda the Central Bank publishes all bank charges in the newspapers for customers to compare; here they give them to some private agency (FSD Kenya) to interpret for customers.

While the Kenyan audit bodies (FIRE, ICPAK) fault our companies for not disclosing the director compensation which they ask their shareholders to dutifully approve at each AGM, Stanbic Uganda shareholder can see that their chairman earns $10,400 and what each board member earns ($1,700 to $4,250) for them to approve.

Lastly, I don’t know any Ugandan stockbrokers but I’m sure it’s easier to ascertain their performance (and avoid rogue brokers) than it is here.

13 comments:

Anonymous said...

Whenever I am home, it is really frustrating dealing with the attitude you describe. Try working with some of the parties you refer to and see them act like you are trying to rob them!!! Provide them with ways to make money, be generous with shares, provide a pathway to profit and watch them run away, and scream at you!!!

Reading your article really brought back flashbacks. Knowledgeable Kenyan professionals who work in Kenya are heros in my books, having to deal with some of the characters you allude is takes imense patience.

Anonymous said...

the problem is lack of political will:
our system does not give any politician or person any incentive t solve any of this vexing problems - anyone here remember Joe donde ? politicains gain capital from being in the press making noise rather than legislating - perhaps if we named legislation after MP's they would have 'incentives'. Otherwise most innovation will come from bureuacrats and their commitees which take 5yrs to implement.whne funds are available from the world bank.kenyans have brains but our system does not allow them to imnnovate and improve. agood xample is the GJLOS reform its not like we dont have kenyans who understand what needs to be done but there is no incentive for the relevant ministry tomake reforms unless some extranal funding and junkets are involved. sad.

Proud Kikuyu Woman said...

I'm currently reading 'The Mystery of Capital' by Hernando de Soto. Just started but highly recommend it. Author argues that there is capital in developing countries like ours, but its dead capital in that it's not formally recognized. Most folks do business informally. You can't therefore expand your bizna e.g. by financing through offering equity or using assets as collateral against debt. Basi unabaki pale paaale tuu.

But it's kinda understandable, though bad for the larger scheme of things, why people want to remain in the informal sector. What's the incentive if going formal if it only means giving a (insert #) % of your $$ in taxes to your gava and getting 0 in return? I won't even get myself started on the obese cabinet. Because I think I'm done complaining. After all, who cares?

MainaT said...

Its the complacency that comes from having it good compared to our neighbours. For every one Kenyan who takes pride in being the best at what they do (no matter what arena/activity), I can show you another 20 that might be good at one thing and very mediocre at many others. That in a nutshell is what is messing us up.

The one about valuing shareholders is probably my biggest bugbear with stock-trading in Kenya.

tumwijuke said...

"Rwanda has more hotspots than toilets," I was told last weekend. Having been to Rwanda on several occasions, I think you should take the Rwanda ICT success story with a pinch of salt.

Oh and I dated a Ugandan stockbroker once ... can I help? :-) Happy May Day.

Maishinski said...

Here we go again...

Option 1. We could analyze faults and complain amongst ourselves - fill our minds with negativity and despair... and when we are done, NOTHING will have changed.

Option 2. We could put our minds together and come up with creative and practical ideas on ways to improve lives of all Kenyans, organize ourselves to share and educate our fellow citizens and slowly (but surely) change ATTITUDES and the way things are done (SYSTEMS).

We are the system. We are the government. Our attitude determmines our fate.

:-)

salf said...

We need political goodwill. Political goodwill has alot to do with so much of the rest like corporate governance, growth in business and finance of a country, development, enlightened citizenry etc. How I wish our political thing was working!

just what? said...

why should the giant wake up anyway? contrary to the views of innovative kenyans, such as those who post on this blog,Kenya actually works, and very well. just not for people like you. in any society, wealth is earned either by luck, intelligence, aggression and by some measures patience. the current kenyan system favors the aggressive (read 'violent') politicos & thugs. so all smart-ideas people are merely an oddity in the system.question is, who'll upset this order and reward ideas in equal proportion to violence?

proud kikuyu woman;
de soto's book is quite a read, strong on fundamentals of capitalism,can his measures work in kenya? without a revolution of sorts?

bankelele said...

Anon: the attitude is an important thread to the problems I highlighted

Anon 2: that’s why many of our government bills are an exact copy of drafts on the IMF or conservation groups’ websites

Proud Kikuyu Woman: will look up that book,

However I disagree with you that people want to remain in the informal sector forever. Established companies are quite adept at maximizing cash generation while minimizing their tax burden – that’s the essence of modern capitalism

MainaT: agreed

Tumwijuke: do tell more about Rwanda please or point out a few blogs from there? I ma very interested

Maishinski: I think we all one to improve. One problem is that people don’t see the need to improve as long as they are making money under the old system

Salf: after 2007, private sector has realized that they need to be more proactive with the ‘political side’ of things

Just what? Sleeping giants who don’t reform become Telkom Kenya. Or people shy away from them in favour of newer, more reform minded, competitors

Anonymous said...

Hi Bankelele, can see you are still going strong with your blog. Could you please e-mail me a copy of the Stanbic UG financial report? Thanks

falconsgladiator@yahoo.com

Anonymous said...

Good Job! :)

Carlo said...

Good JOb! :)

Mugarura said...

As a Rwandan, personally i am affected by the unfounded arrogance of France and its government, these guys trained genociders in Rwanda, who killed over a million innocent rwandese, RPF soldiers stopped genocide and yet they have hijacked one of the heros who participated in stopping the gruesome acts of genocide in recent history just to cover up their role with genociders!! Tell them, they can waste our precious time, but they will never touch the heart and love we have for country . Know that Rwanda is now liberated from your infemous trany. Why don't you keep your reserves you stole from Africa in form of hills and forests and leave us in peace? You call yourselves civilised, yet you real thieves and backward.

LinkWithin

Related Posts with Thumbnails