NAIROBI, Kenya, Mar 30 – Businesses operating in Kenya are optimistic of making higher returns in 2010 as economic conditions continue to improve, a new research revealed on Tuesday.
A Business Leaders Confidence Index released by Synovate Research shows that 67 out of 100 chief executives and directors of leading companies were optimistic of the days ahead being better than 2009.
Addressing journalists during the release of the survey, Synovate Group Managing Director George Waititu attributed this to declining effects of drought and the global economic crisis that suppressed business growth over the last two years.
“The fact that the global recession is no longer a major factor generates a lot of confidence and it’s out of that business leaders make certain decisions to grow their business,” Mr Waititu said.
With the arrival of three sets of fibre optic cables onto the Kenyan shores, belief by the ICT and telecommunication sector to grow is highest with 80 percent of those interviewed expressing optimism. The tourism sector is also poised for better things in 2010 going forward.
Mr Waititu said the business leaders pointed out stable Interest rates as well as the Central Bank’s role of keeping the cost of credit low as indicators of stable environment.
He indicated that most leaders were aligning themselves with the disbursement of the Economic Stimulus Package in an effort of growing their business.
Following the increased optimism, companies were said to be employing new strategies such as expansion and product diversification, which will have a positive impact on the economy.
“As many as 66 percent said they would be introducing new products with 47 percent of them seeking to expand their business in the East African market,” he said.
This comes as a sharp contrast to a similar survey carried out by the firm in 2008/2009, which showed most companies were opting to either restructure, cut costs and or cut back on capital spending or a combination of all three.
Political instability however remains a major deterrent to future prospects with as many as 76 expressing their concern over the current political climate.
“I think there is need for our political leaders to cut down on their speech which, whether you like it or not, has major impact on business activities in Kenya,” Kenya Private Sector Alliance Chairman Patrick Obath, who was present, said.