The Government is not doing enough to encourage the private sector to keep investing in the country.
United Nations Conference on Trade and Development (UNCTAD) Secretary General Mukhisa Kituyi asked the Government to concentrate on encouraging local investors and to go slow on foreigners who need huge incentives to pump their money into the local economy.
"It is sad that in Kenya today, the Government favours foreign investors whereas a Kenyan investor in Nairobi prefers to register a company in a place like Mauritius before registering one in Kenya as a foreigner," Dr Kituyi said.
Speaking at a forum organised by the Kenya Private Sector Alliance in Nairobi yesterday, Kituyi asked chief executive officers to build strong business models that were sustainable and guaranteed continuity.
He said this could be achieved if the businesses were socially responsible by investing in the same environment they worked in.
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He added that they should also put in place measures that were friendly to their labour resource in order to boost productivity.
The UNCTAD boss asked the Government to go slow on regulation, saying bottlenecks caused by unfriendly legislation were responsible for the slow growth in the private sector.
"The Government should improve the investment conditions and not increase regulations. The private sector should be given firsthand opportunity to give their views before the State decides on any regulations. Besides, a lot of manpower is needed to implement compliance, which in the long run is expensive," Kituyi said.
Trade, Industry and Co-operatives Cabinet Secretary Adan Mohamed said the Government was doing all it could to improve conditions for local investors.
He cited the investment on infrastructure as one of the key areas the state was focused on.
"We are putting up the Lamu port and all other projects along the Northern Corridor. All this is aimed at lowering operational costs," he said.