High corruption tendencies constitute major blockades to achieving a good and enabling business environment in Africa, according to the Common Market for East and Southern Africa (COMESA) Business Council.
According to the COMESA officials, corruption has become a “daily way” of getting things done in some countries it has been adopted as part of life, denying millions of people access to basic needs.
The African Development Bank estimates that $148 billion is lost to corruption in Africa every year.
Moreover, Sandra Uwera, the Chief Executive Officer of COMESA Business Council, believes it could be “way more than that”.
“Corruption has taken a twist and is carried out through ‘gifts, favours and some people keeping a blind eye on unlawful transactions. There’s total lack of integrity in SMEs and this can’t take our economy to the level we want,” Uwera said.
She added; “In many countries in Africa, corruption has become part and parcel of doing business. This is especially because many growing enterprises always enter a business deal with the mind-set: what is it in for me? This determines the foundation of short term results, quicker routes to make profit and in the long term, a once off deal, instead of a long-term sustainable partnership”.
COMESA Business Council has convened an anti-corruption compliance training in Kigali involving about 50 companies with the aim to strengthen business ethics through developing anti-corruption compliance codes for businesses.
Some African businesses have lost bids to partner with global corporations due weak corporate governance practices, Uwera said.
Michel Minega Sebera, the Permanent Secretary at the Ministry of Trade and Industry, said that Rwanda has deliberately pushed for transparency and creation of an enabling business environment.
“Business integrity has to be a culture if we are to promote a conducive environment for businesses to thrive,” Sebera said.
On the other hand, business leaders welcomed the training but raised concerns of uncoordinated tax regimes across the region, unfair competition and unethical public officials who lure them into corruption tendencies to earn contracts as some of the reasons behind the so-called lack of business integrity in the region.
“This issue of corruption goes two ways. You can train me on being ethical and professional but if we still have some procurement officers who feel entitled to a certain percentage of the deal before they can sign it off, yet I need money to survive. Then we have a long way to go,” one businessman who preferred anonymity told The New Times.
Ephraim Kwitonda, from Bella Flowers Ltd, also said that, “corruption affects business growth in a negative way and we hope this training will help us better understand how to deal with both local and international partners on a more professional level and learn how we can protect our companies from the vices.”
Rwanda is developing a voluntary corporate governance policy, in addition to the one already established by Private Sector Federation (PSF), according to the Registrar General at Rwanda Development Board, Richard Kayibanda
“We are still working on the anti-corruption compliance. PSF has its own and now RDB is working on one but at the moment – because there are other existing components in the anti-corruption law – we want to first make it voluntary and help businesses understand and adhere to the best practices,” Kayibanda said.