Corruption has long been seen as an impediment or major obstacle by 74 percent of the sampled firms and generally seems to have the same effect across the spectrum. It appears that the foreign firms in the country are affected more by corruption compared to local ones, as 81 percent of them rated it as a major or very severe problem.
Foreign firms are targeted by officials due to the perception that they have ample resources. An alternative interpretation is that the international experiences of their owners and managers, coupled with their perception of what is normal and acceptable, and could lead to their “loud” complaints. Half of all firms — 48 percent — reported at least a bribe is asked from them in the past one year. The total amount given out as bribes by most foreign companies in Kenya averaged 3.8 percent of their annual revenue. The figure for Uganda was 2.4 percent.
Firms were asked if informal payments were requested for utility connections, government services, and during inspections by government agencies.Fifty percent of firms that required telephone connection in Kenya were asked for an informal payment, compared to less than a fifth of the firms in Uganda and Tanzania. The medium payment is $100.Thirty eight percent that sought construction permits in Kenya were asked for a bribe — more than three times as often in Uganda and Tanzania. The medium payment in this category was $400.IMAGINE?
FOREIGN INVESTORS AFFECTED MOST BY CORRUPTION.