, NAIROBI, Kenya, Jan 13 – Over regulation in African countries has been named as one of the major threats to growth for many companies.
According to a survey done by PriceWaterhouseCoopers in 22 countries including Kenya, 75 percent of Chief Executive Officers said there was too many laws that hindered firms’ expansion.
Releasing the report in Nairobi on Monday, a tax partner with PWC, Steve Okello, said company heads now want their governments to be flexible as it was not only hard to start a business but also to operate.
“There is a perception among three quarters of the CEOs surveyed in our region that there is over regulation on our countries. They say this impacts greatly on their business strategies,” Okello said at a media briefing.
Eighty three percent of the CEOs in the survey dubbed Africa Business Agenda, said that an increasing tax burden remained a challenge to many companies in the continent.
In pursuit of this, 58 percent of them said they anticipate some change to their approach to tax planning and contribution this year.
“Tax planning influences corporate reputation and can help to build trust among stakeholders. But the larger issue is that ambiguity and uncertainty regarding the tax and regulatory environment hurts growth prospects,” Okello added.
On the other hand, CEOs remain concerned about the availability of key skills with about 84 percent of them giving priority to creating and fostering a skilled workforce.
“Like our case here in Kenya, the curriculum that we go through is very academic and therefore when you are a graduate, you employer begins with training you first. This tells a lot,” PWC Human Capital leader Kuria Muchiru commented.
In addition, firms are being forced to not just train their employees, but look for strategies of avoiding to losing the experienced employees to their competitor.
He said employers want to inspire pride and loyalty, among their employees which comes down to more than just pay and promotions.
“Challenging career opportunities, contributing to strategic decision making, technology and flexible working hours also improve retention. At the end of the day, talented people want to work in world-class facilities among the best and the brightest,” he added.
Despite the challenges, most of the CEO expressed optimism about the prospects for revenue growth over the next 12 months.
CEOs in Ghana, South Africa, Zimbabwe, and Rwanda, showed the highest level of optimism compared to CEOs in Kenya, Tanzania, Uganda, and Zambia, who are “somewhat” confident of growth.