Connect with us

Business

Why the Uhuru rescue plan may not help Wanjiku : The Standard

Published

on

Loading...

A Jua Kali artisan sweats to eke out a living at Kibuye market in Kisumu County. President Uhuru Kenyatta’s bailout measures may not trickle down to him. [File, Standard]

President Uhuru Kenyatta’s tax cuts, which are aimed at cranking up an economy that has been ravaged by the coronavirus pandemic, might not benefit Wanjiku after all.

Instead, experts have argued that the prescription would only benefit a fraction of salaried Kenyans and big companies, leaving out millions of citizens who ply their trade in the ubiquitous informal sector.
According to analysts, a lot of enterprises in the Jua Kali sector have lost their businesses as the economy slowly shuts down after the country reported cases of the novel coronavirus.
Extreme poverty

SEE ALSO :After Uhuru decision on housing, state must listen to people more

A 2016 report by the Kenya National Bureau of Statistics (KNBS) showed that there are about 1.56 million licensed micro, small and medium enterprises (MSMEs), and 5.85 million unlicensed ones.
They employ about 14.9 million people, many of whom live a day at a time. This means any shock is likely to drive them into extreme poverty.
The Central Bank of Kenya has projected that the virus will devastate the economy this year, slowing its growth down from 6.2 per cent to 3.4 per cent.

For More of This and Other Stories, Grab Your Copy of the Standard Newspaper.  

The sectors that have been hit hard include tourism, aviation and exports, which heavily rely on the European market.
Fearing that the pandemic might snowball into a full-blown health crisis, President Kenyatta has instituted stringent measures, among them the imposition of a 7pm to 5am curfew, which starts tonight.  

SEE ALSO :The wars in Uhuru and Raila political parties

Schools, pubs, nightclubs, and other entertainment joints have since been closed. Workers have been forced to work from home, leaving matatus and restaurants without customers.
Around the country, open-air markets, where most poor people buy their food, are increasingly being closed by county governments who see this as a means to arrest the spread of coronavirus disease, Covid-19.
These measures have seen a lot of Kenyans lose their source of income. Yet, rather than address their plight directly, the president, according to economist David Ndii, decided to give them tax breaks.
“I am at a loss as to how this is a rational response policy for a government that was in a fiscal crisis before the Covid-19 shock, or how tax breaks translate to food on tables of ordinary people who have lost incomes and jobs,” said Dr Ndii in a tweet.
He faulted the decision to slash taxes as an intervention, saying there would be no taxes to be paid anyway as business would have shut down.

SEE ALSO :Renewables top 90pc of Kenya’s power

“For the duration of the crisis, their (MSMEs) income/turnover tax returns will be nil, VAT returns nil. I doubt they have cash reserves for salaries – PAYE returns nil,” said Ndii, adding that the government should have slashed its spending.
Indeed, by the time Uhuru unveiled the stimulus package, one of Wanjiku’s main sources of livelihood in Nairobi, Gikomba Market, had already been stifled by the virus.
Gikomba, a leading open-air market for mitumba in the region, will remain partially closed after Trade and Industrialisation Cabinet Secretary Betty Maina directed that the importation of second-hand clothes be stopped.
Shut down
Other open-air markets such as Wangige in Kiambu, Kibuye in Kisumu and Daraja Mbili in Kisii have also been shut down, rendering hundreds of thousands of people jobless.

SEE ALSO :Uhuru launches Naivasha SGR operations

Loading...

Official figures show that nine in every 10 Kenyans earn their living from the informal sector.
Yet, other than a reduction of value-added tax (VAT) from 16 per cent to 14 per cent, there was not much that Kenyans in the informal sector received from the bailout measures.
Uhuru also directed the Treasury to come up with a mini-Budget that would see turnover tax (ToT) slashed from three to one per cent.
The tax was introduced in January and is levied on businesses with annual revenues of less than Sh5 million.
However, not very many informal enterprises had started paying this tax, so in a way, it is not a relief.
Wohoro Ndoho, the CEO of Euclid Capital and a former director of general public debt management at the Treasury, agreed that the tax “measures were focused on a small part of the economy.”
He, however, noted that it was the only thing the government could have done given its meagre resources.
He also thinks the government is only testing the waters and might return with more comprehensive measures.
Those earning a gross salary of up to Sh24,000 a month were granted full tax relief on their salary, also known as pay as you earn (PAYE). The rest will benefit from a reduction of PAYE from 30 per cent to 25 per cent.
Corporations will also see tax on their profits, corporate tax, reduce from 30 per cent to 25 per cent starting April, as the government sought to ease the cost of doing business for firms that have started catching the virus’ fever.
The confirmed cases of people infected with Covid-19 had hit 31 as at yesterday.  
Moreover, while a reduction in consumption tax would help ease the cost burden with lower VAT, the poor might not benefit from the measure as most of the items they spend money on have already been either exempted or zero-rated.
For a poor person in Nairobi earning less than Sh24,000, almost half of their income goes to food.
While supermarkets are almost the only place where middle-income Kenyans in Nairobi can buy food from, they are an anathema for the poor who buy most of their food from open markets and eat from their local kibanda, or food stall. Food from a kibanda does not attract any tax, while deli products attract a levy of two per cent.
Additionally, flower farms, and tea and coffee plantations used to employ hundreds of thousands of poor Kenyans. Now, without a market, most of them are closing their businesses. There are no new foreign markets. Almost every nation in Europe is on lockdown or has issued travel restrictions.
No fiscal space
Economists like Ndii insist that no amount of tax relief will help the majority of Kenyans. Instead, he proposes a lifeline fund, which would see both business owners and workers feed their families.
It is what is being done in a number of developed countries that have put together stimulus packages.
However, Mr Ndoho noted that the government does not have the fiscal space to undertake such measures, saying Uhuru has found himself in a ‘prisoner’s dilemma’ of sorts.
“He can’t cut taxes completely because the government needs those taxes for medical costs,” he said, adding that the country is wary of sliding into the Italy situation where thousands of people have died from the disease.


Do not miss out on the latest news. Join the Standard Digital Telegram channel HERE.

Uhuru KenyattaEconomyCoronavirus

Comments

comments

Loading...
Continue Reading

Business

Huawei Full Year Revenue Jumps 19% to $123 Billion

Published

on

Loading...

Huawei Technologies said on Tuesday that its revenue for 2019 amounted to 858.8 billion yuan ($123 billion), marking a 19.1% rise from the previous year but missing the company’s target.

Rotating Chairman Eric Xu noted that the revenue was in-line with original expectations but that came $12 billion short of the $135 billion target the company wanted to set in April 2019. Xu stressed that Huawei failed to reach that target due to the fact it was blacklisted by the United States in May.

The Chinese tech giant’s net profit for the twelve-month period climbed 5.6% year on year to 62.7 billion yuan. Despite the increase, profit growth was slower than in 2018 when it stood at 25%.

As part of a long-term, ongoing investment in technological innovation and research, Huawei invested 15.3% of its 2019 revenue back into R&D. Its total R&D spend over the past decade now exceeds 600 billion yuan.

“2019 was an extraordinary year for Huawei,” said Eric Xu. “Despite enormous outside pressure, our team forged ahead with a singular focus on creating value for our customers. We worked hard to earn their respect and trust, as well as that of our partners around the globe. The business remains solid.”

In 2019, Huawei’s carrier business led the commercial rollout of 5G networks. To further commercial adoption and promote new innovation in 5G applications, the company established 5G joint innovation centres together with carriers worldwide. Huawei’s RuralStar base station solutions can effectively address coverage problems in remote areas. These solutions are being used in over 50 countries and regions, bringing mobile Internet to more than 40 million people living in remote areas. In 2019, sales revenue from Huawei’s carrier business grew 3.8% year-on-year.

Loading...

Huawei’s enterprise business continues to support the digital transformation of customers across industries as the company helps lay the foundations for the digital world. Globally, more than 700 cities and 228 Fortune Global 500 companies have chosen Huawei as their digital transformation partner. In 2019, Huawei announced its computing strategy with the aim of cultivating fertile soil for the intelligent world to flourish. As part of this strategy, the company launched the world’s fastest AI processor, the Ascend 910, and the AI training cluster Atlas 900. In 2019, sales revenue from Huawei’s enterprise business reached CNY89.7 billion, up 8.6% year-on-year.

Huawei’s consumer business continues to see robust growth, with a total of 240 million smartphones shipped throughout the year. The company reports further progress in developing the Seamless AI Life ecosystem across all scenarios and devices, including personal computers, tablets, wearables, and smart screens. In 2019, sales revenue from Huawei’s consumer business reached CNY467.3 billion, up 34% year-on-year.

“The external environment will only get more complicated going forward,” Xu cautioned. “We need to keep enhancing the competitiveness of our products and services, promoting open innovation, and creating greater value for our customers and society at large. This is the only way we can seize the historic opportunities presented by the digital and intelligent transformation of industries, and maintain robust growth in the long run.”

Comments

comments

Loading...
Continue Reading

Business

Do you have a tribe? : The Standard

Published

on

Loading...

It was one of those times, when I had plenty of time and so little to do. Much like the quarantine times we are in.

So I decided to sit through the new Kevin Hart’s Netflix show ‘Don’t F***k It Up’. Now, I am not much a fan of Kevin Hart the person, but I do love his brand of stand-up comedy.
I was particularly interested in the episode where he addresses cheating on his then pregnant second wife; the gorgeous model Enico. Never mind that he lost his first marriage after continually cheating on his wife, but I digress.
I started watching the episode with some skepticism and judgement towards the man but by the time I was done, I had to admit that there is a reason why Kevin is the man he is.  

SEE ALSO :Will MPs be stopped from moonlighting?

He is a little man in stature, but a giant in everything else, especially now that he has conquered movie production in Tinsel town, a place where men like him (read black) don’t often ace it. He has an inimitable work ethic and more importantly he has found his tribe.
There are always four men with him; his best friends. He will not go on any live show or TV interview without them. Many may think they are groupies or just in it for his fame, but no, they are truly his tribe.
They were all friends before he hit pay dirt. And today, they play various roles around him. And when news of his cheating on his pregnant wife hit the grape vine, they formed a shield around him as he sorted out his mess.


Bishop who fought for Kenyans  

And when he got into the tragic road accident a few months ago, a death bed knocking experience, his affairs run like he wasn’t out of commission.
Do you have a tribe? I believe this is the year you find yours. 

SEE ALSO :Best cameras under Sh50,000

Loading...

No, I don’t mean people who speak your native language. I mean ‘your people’; the people who will stand by you no matter what you do.
That doesn’t mean they won’t call you out on bad habits, no…But they will hold your hand through your struggles. You will never walk alone.  
You don’t need that many people in your tribe; just people who truly see you for who you are and love you nonetheless. But you also have to be this kind of friend to them too.  


Do not miss out on the latest news. Join the Standard Digital Telegram channel HERE.

HustleKevin HartNetflixEntrepreneurship

Comments

comments

Loading...
Continue Reading

Business

4 reasons entrepreneurs need mentors : The Standard

Published

on

Loading...

Yes, you can read the best entrepreneurship books and blogs, but they will only give you generic business advice. And there’s no shortage of family, friends, acquaintances willing to give you a steady flow of unsolicited advice regarding your business. 
You can also hire industry analysts, consultants, and employees to get expert information on dealing with particular situations. However, the most impactful form of guidance and advice for an entrepreneur comes from real business mentors.
A real-life business mentor shares hands-on wisdom with you on an ongoing basis, helping you avoid common pitfalls in business and achieve success faster.

SEE ALSO :Things we overlook going into business

1.Expert Knowledge and Outlook
You can gain plenty of knowledge by reading the right books and articles. However, a mentor will give you specific knowledge which might be hard to find in any other resources.
When you have a challenging project, you can ask your mentor for advice on what to do. With their wealth of experience, gained from working on similar projects, they will expertly guide you on what to do to get the best outcomes.


Bishop who fought for Kenyans  

This makes your work easier and increases your chances of succeeding. As leadership speaker J Loren Norris says “If you cannot see where you are going, ask someone who has been there before.”
2. Networking Opportunities

SEE ALSO :Business leaders trail in list of role models

Due to having many more years in business, a mentor comes with an unlimited network of helpful contacts who might benefit you as entrepreneur.
With just one call, they can connect you to the right people for production or distribution of your products, to get financing, to get the right licences and so on.
A good mentor will also give you valuable feedback on your networking skills and gives you advice on how to improve on any problematic areas.
3. Reassurance and Hope
Many young entrepreneurs battle self-doubt and question their ability to succeed in business. These feelings might lead to imposter syndrome, where an entrepreneur feels unworthy of their success.

SEE ALSO :Local firms also need to be given tenders

Having a mentor to listen to your worries, and placate your unfounded fears with their years of experience can reassure you that you’ll be successful…and that you truly deserve your accomplishments.
As billionaire Oprah Winfrey says, “A mentor is someone who allows you to see the hope inside yourself. A mentor is someone who allows you to know that no matter how dark the night, in the morning joy will come. A mentor is someone who allows you to see the higher part of yourself when sometimes it becomes hidden to your own view.”
4. Accountability
Even after setting goals and having a great plan on how to achieve them, most of people, including entrepreneurs, have trouble following through. A mentor can help keep you accountable to your goals and business objectives.
Without telling you what to do, a great mentor helps you set the key objectives and then holds you accountable to working towards them. They will gently admonish you if you fail to meet objectives due to laziness on your part.

SEE ALSO :Harness the power of regulation to grow Kenya’s on-demand economy

Loading...

How to find a mentor
Create a checklist of the skills and attributes you would like in a mentor
 It is important that you find the right mentor to suit your business and personal style. Before you set out to look for a mentor, make sure that you understand exactly what you want from a mentor.
Do you need networking opportunities? Do you want advice on building your business? Are you looking for someone with expertise in a certain field?
Different people will bring different sets of skills and varied perspectives to the mentorship experience, so you have to be clear on what you want. Bear in mind that as a mentee, your needs will evolve over time.
Although you can have different mentors for different phases of your entrepreneurship, it is best to look for someone who can mentor you for an extended period of time.
Attend local business networking events or scour social media
You have to show them your dedication by being active in relevant discussions. Business incubators and accelerators are also a great place to look for mentors. 
While it doesn’t hurt to aim for the top, don’t ignore the moderately successful potential mentors…after all, they can end up connecting you to the right opportunities. Be on the lookout for an older entrepreneur with plenty of practical experience and dedication to mentoring newer entrepreneurs.
After finding a mentor, remember to be a good mentee
Be a good listener who is open to new ideas and perspectives. Later, after benefiting from having great mentors and making your business a success, make sure you pay it forward by mentoring other entrepreneurs.
Ideally, a business mentor should be someone who has more entrepreneurial business experience than you. They should be willing and able to be your trusted business confidante over an extended period of time, usually without charging any fees.  


Do not miss out on the latest news. Join the Standard Digital Telegram channel HERE.

EntrepreneurshipJobsMoneyInvestmentMentorshipNetworking

Comments

comments

Loading...
Continue Reading
Advertisement
Loading...
Advertisement
Loading...

Trending