Relations between Kenya and US Business strained by bribery

The process of awarding contracts is becoming more complicated for businesses owned by the United States, in Kenya. A recent report revealed that US firms have been denied big contracts in Kenya because they have refused to play ball. An official report from the US government disclosed this information.

The US report titled the National Trade Estimate Report on Foreign Trade Barriers (NTE Report), notes that bribery and corruption in Kenya have become an alarming concern when conducting business in the East African state.

“Corruption remains a substantial barrier to doing business in Kenya. U.S. firms continue to report challenges competing against foreign firms that are willing to ignore legal standards or engage in bribery and other forms of corruption,” the report reads partly.

“Corruption is widely reported to affect government procurements at the national and county levels. Kenya has not effectively implemented its anti-corruption laws. U.S. firms routinely report direct requests for bribes from all levels of the Kenyan Government,” it adds.

According to the report, the efforts so far by the Kenyan authority to tackle this issue have had little to no effect owing to the backlog of cases and persistent misconduct.

“Despite efforts to increase efficiency and public confidence in the judiciary, the backlog of cases and continued corruption undermine the judicial system’s credibility and effectiveness. While judicial reforms are moving forward, bribes, extortion, and political considerations continue to influence court cases,” the report states.

Another issue highlighted in the report is the real estate barrier that prohibits or complicates the process of owning property as a foreigner.

This ban is courtesy of the 2010 Kenyan constitution which states that foreigners are not allowed to possess freehold land rights in Kenya, only leasehold titles for up to 99 years.

“The process for leasing developed land and property is clear and established, but the process for obtaining the clear title of undeveloped land is opaque and unreliable. For undeveloped land, investors risk receiving fake title deeds or leasing a plot with multiple titles and unauthorized sales,” as seen in the report.

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