In a story appearing on BBC Business News Online that I cut and paste below, Singapore once again remains at the top of the list of countries in which to run a business, which means investors are still channeling money to the island nation five years after discovering this relatively small nation of about 5 million people.
Will Kenya be the next Singapore of the world after turning ourselves around and implementing our reforms?
If Kenyans choose our president wisely, that should be the case, but it’ll take awhile to clean up the economic and social mess of last 4 decades.
However, we must start somewhere and one thing anyone who bothers to find out can easily find out, investor money movement in the world is peculiarly the same and essentially by the same people.
Speaking from experience, our firm LLP Enterprise, LLC, among other things, advises and assists investors in meeting their investment objectives in a number of countries, which includes identifying suitable places to invest and local partners to work with after conducting the necessary due diligence.
However, as deep pocketed as these investors can be, none of them is ever willing to put their money where another has not, which ends up being like a chicken game as between and among themselves.
Many times, clients come to us to find investors for their respective projects and if they meet our criteria, we agree to find such investors from within our network of investors, which means we become the sellers of these projects and thus the reason they must meet our own criteria; as in any sales, you are not going to successfully sell something you don’t believe in or care about at all.
I am invariably in this context asked whether the opportunity has been presented to so and so but this is a rhetorical question because the information sought is actually why did so and so not go for it.
Although there are any number of reasons this may happen, including the terms of investment, corruption remains #1 reason most of these investors don’t even want to hear about such opportunities to the point we don’t even bother presenting same to them but they are happy and in many cases anxious to unload their money elsewhere and, in fact, often do so.
To be sure, there are investors who could care less and are willing to invest even in a corrupt environment but that’s not a road our firm has ever been interested in and neither shall it ever, not because our firm is a US subsidiary of a foreign corporation and therefore bound by the strict US Anti-Corruption Law, but because it is the right thing to do in ending or at least dealing corruption a major blow.
I therefore always find it very sad we cannot bring certain investors to invest in Kenya because of the corruption factor but easily succeed in having them invest in other countries where the vice is not as pronounced.
Very sad because for every investor who declines the opportunity to invest, it is one more missed opportunity for a country to benefit in general and twice a missed opportunity for those who stand to benefit from such investment immediately and directly.
Once you convince one investor to invest, however, then the flood gates open.
That’s what happened in Dubai, Singapore and soon another country in Southeast Asia which is also about to burst into the global scene as a magnet for business.
This country has convinced an investor to put up USD200 million to build a new airport and hospital and no sooner had the ink dried on the MOU on this deal, the investor’s buddy has submitted a proposal to invest USD1.5 billion in the country’s hotel industry. Others are lining up with their proposals and I am certain that country will be transformed in less than a decade it took other countries to do so.
My point is this: Each one of these countries followed or are following a well known and easily copyable road map with deviations only taking advantage of their respective strengths, while eliminating their respective obstacles to investment, not just in policies and regulations, but in inspiring its people to to think as one and to be the best in their respective endeavors.
Investment in education, infrastructure and technology goes without saying.
These are not things that are not known or are impossible to achieve in Kenya; they are, we just need a reliable implementer and none can say they are or can be without also having the confidence of investors in the ready to come and invest, once they are in power instead of seating on the sidelines waiting to see what progress is made, if any, before they make that move.
Ask any of these international investors what risk score they have given each of these declared candidates, you’ll find without exception one has a very high score (meaning good) and the rest are ranked very low (meaning high risk) or not rated at all for being unknown or have nothing by which to measure them, which means the same thing to the investor as being high risk and therefore a no go for investment purposes.
The overall political risk of the country is also obviously heavily weighted but the two, namely, the head of state and country’s political risk factor go hand in hand and thus the reason the elections of 2012 will determine what direction the country goes next decade and more: Singapore direction led by a president capable of leading as such or Somali direction or simply stagnant, courtesy of a president incapable of leading as such.
I say we go and must go with a president capable of leading us the Singapore direction.
Peace, Love and Unity
Singapore ‘best country in which to run a business’
The Asian nation has come top of the World Bank’s Doing Business 2011 study, which rates 183 countries on the ease in which they allow firms to operate.
Judging nations on criteria such as how easy it is to start a business or get credit, the UK came in fourth place, while Chad was bottom.
Kazakhstan showed the most improvement over the past year.
Georgia has seen the biggest improvement over the past five years.
The best countries in which to run a firm
|Source: World Bank Doing Business 2011 report|
|1. Singapore (2010 ranking: 1)||6. Denmark (6)|
|2. Hong Kong (2)||7. Canada (9)|
|3. New Zealand (3)||8. Norway (7)|
|4. United Kingdom (4)||9. Republic of Ireland (8)|
|5. United States (5)||10. Australia (10)|
Published since 2004, the annual Doing Business report studies nine main criteria in total.
The other seven factors evaluated are – paying taxes, trading across borders, registering property, dealing with construction permits, closing a business, enforcing contracts and protecting investors.
It does not study wider conditions including a country’s infrastructure, workforce skills, or security.
Hong Kong came in second place, with New Zealand third, and the US behind the UK in fifth place. All of the top five remained in the same position as a year earlier.
Out of the 183 countries surveyed, the World Bank said 117 implemented new business-friendly regulation between June 2009 and May 2010 – the 12 months covered for the 2011 report.
The World Bank said governments were reacting to global economic circumstances.
“Against the backdrop of the global financial and economic crisis, policy makers around the world took steps in the past year to make it easier for local firms to start up and operate,” said the report.
It added: “While some economies have been hit harder than others, how easy or difficult it is to start and run a business – and how efficient courts and insolvency proceedings are – can influence how firms cope with crises and how quickly they can seize new opportunities.”
On a regional basis, the latest Doing Business report found that countries in Eastern Europe and Central Asia did most to make running a business easier in the 12 months covered, with 84% of countries carrying out at least one pro-business reform.
Kazakhstan, which recorded the most improvements worldwide, carried out several measures including amending its company law, streamlining business start-up procedures, and making it simpler to get construction permits.
East Asia and the Pacific was the next best performing region, with three quarters of all countries introducing at least one reform to make life easier for firms.
Latin America and the Caribbean saw the fewest improvements, with only 47% of countries introducing one or more pro-business measures.
Report co-author Dahlia Khalifa told the BBC that Singapore continued to lead the way for a number of reasons.
“Singapore has now been top of our survey for the past five years,” she said.
“It is simply the most efficient place from which to import and export. For example, you only need four documents to export and import goods, which remains global best practice.
“Singapore is also the leader in protecting investors and minority shareholders.”
China, now the world’s second-largest economy, trailed Singapore in 79th place.
Regarding the UK, Ms Khalifa said the report praised the ease in which firms could get credit, and that it had some of the strongest legal rights for entrepreneurs.
The report also highlighted the UK’s efficient system of credit information, and the speed in which commercial disputes were handled in the courts.
In Africa, the report said the best performing country was Mauritius, which it said was the world’s 20th best place in which to run a company.
This beat a number of nation’s in Western Europe including Germany (22nd in the global ranking), Belgium (25th), France (26th), Switzerland (27th), and Netherlands (30th).
South Africa is the next highest placed African nation (34th), followed by Botswana (52nd).
Rwanda, which came in 58th on the overall list, up from 70th last year, was the second most improved country in both the past 12 months and five years.
Chad was the worst performing country for the second year in succession.
In Latin America, Mexico (35th) is now the best place to run a business, followed by Peru (36th). They overtake Colombia, which fell one place to 39th.
Venezuela, run by left-wing President Hugo Chavez remains the worst place in which to do business in the region, and is in 172nd place on the global list.
In the Middle East, Saudi Arabia is the best performing (11th globally), followed by Bahrain (28th), and Israel (29th).
“We are very pleased to see that more and more countries are making it easy for companies to do business,” added Ms Khalifa .
“The message is loud and clear – countries realise they have to be serious about getting small and medium-sized firms up on their feet and creating jobs.”