Political issues that might face a multinational wishing to move into Kenya1.0 IntroductionKenya is a less developed country in east Africa that is the strongest economy in the region. There are a variety of political issues that may face a multinational wishing to open shop in Kenya as will be discussed in this paper. In light of this issues and other relating factors such as cost of doing business and the economy in general, this paper will briefly outline some entry strategies that can be adopted in entering the Kenyan market by an international firm. 2.0 Political ideology in Kenya A look into Kenya’s history provided in Kenya: Economy (2013) Kenya was colonized by Britain and got its independence some 50 years ago.
From 1963 to 1993 Kenya remained under one party rule. It was an era full of political instability as pressure mounted on the government to adopt multiparty democracy. Multiparty democracy was adopted in 1993 and is still the ideological system today. According to the U. S. Department of State (2013) on Country Background notes, Kenya’s democracy has not been without its share of challenges though as ethnic rivalry is still rife threatening to destroy the democratic system in the country like it was the case in the year 2007 when Kenya experienced post election violence caused by disputed general election.
This period resulted in deaths of citizens and destruction of properties including commercial properties. The country is now enjoying a stable economic and political environment having gone through elections in 2013 that were peaceful and democratic. Kenya is one of the most sable democracies in Africa together with several; other nations like South Africa and Ghana. The state has liberalized the economy to enable the private sector play its role in the generation of GDP and provide the much needed employment to the population.
There is minimal control of the economy by the state either directly or indirectly. There are few firms in the economy owned by the government but they don’t control a considerable chunk of the economy nor do they contribute substantially to the GDP of the country. The state has a percentage of ownership in the profitable sectors of the economy such as banking, agriculture, insurance, telecommunications and mining and manufacturing.
Several blue chip companies have the state as a major shareholder in Kenya (Ndwiga, 2013). 3.0 Legal and regulatory environmentThe legal system in any country is to a large extent determined by the politics of a country. Governments enact and implement laws that will enable them achieve their objectives with the constraints of international laws and respect for the dignity and rights of its people. Kenya is governed by a constitution that was enacted by the people of Kenya in the year 2010.
The constitution is based on common and civil laws and the African customs. The law to a large extent provides individual rights like the ones granted by western nations (Ndwiga, 2013). There is no state religion and people are not required to behave in ways prescribed by state for as long as they adhere to the rule of law.