The Parliamentary Committee on Trade, Industry and Cooperatives led by Chairperson James Gakuya on Tuesday faulted the government's strenuous policies that have made private companies exit Kenya in favour of setting up shop in other markets.
While holding a consultative forum with the Ministry of Trade, the Committee attributed the recent trend of investor flight to hiked taxes and a tough operating business environment.
The legislators expressed concern that the companies are leaving Kenya for neighbouring East African countries such as Tanzania and Ethiopia where the MPs claimed the companies enjoy an overall better business environment including; better taxation policies, affordable electricity and stable regulatory environments.
The committee chairperson while criticising the government revealed several Kenyans had been rendered jobless after private companies closed their Kenyan operations.
“Industrial area was a booming area, but today it is deserted. You cannot even be able to know whether that is the industrial area we all knew," Gakuya lamented.
The committee chairperson who was speaking to the press after the consultative forum noted while some migrated to the neighbouring countries, others migrated to China.
Gakuya noted the companies migrated to China to save on operational costs and ease the process of importing raw materials for their industries.
"The market has now diverted to China, then we are asking ourselves why can't we bring the industry here so that we stop pressuring the dollar,” Gakuya stated.
"At this point, they must have learned the commodities that need to be imported, then if they must be imported why did we bring the factories here?" questioned the MP.
On March 7, the Parliamentary Budget Office (PBO) in a report revealed a worrying trend of foreign investors leaving the country.
According to the report, Kenya risks losing even more investors due to the tough operating business climate that has culminated into a bear market as espoused by reduced profits at the Nairobi Securities Exchange (NSE).
"The erosion of investor confidence and reduced capital formation stemming from the struggling stock market collectively contribute to a challenging economic landscape for businesses across sectors," read part of the report.
