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Opportunities, obstacles for operators and content providers in EA

Regionalisation holds the largest opportunity for investors in East Africa, although trade barriers and monopolies remain a hurdles to entering the region.

Wananchi chief executive officer (CEO) Richard Bell told the East Africa Com conference in Nairobi, Kenya, that regions with a similar population to East Africa had manage to remain more competitive.

Bell however said East Africa has slowly become among the most attractive markets for investors thanks to the increased population focus brought about by regionalisation as well as the discovery of minerals such as oil and gas.

He said another area of opportunity is the fact all the countries in the region have a stable political climate.

However, he said investors have to cope with the lack of regional connectivity as well as the monopolisation of infrastructure, citing Tanzania where the government has decided to run the fibre backbone.

As a result, according to Bell, Tanzania is evolving more slowly in transforming its infrastructure as compared to its neighbours.

“There is lack of regional interconnectivity due to market rigidity especially in Tanzania,” he said.

He also pointed to tax inconsistencies in the region, as well as a lack of treaties eliminating double taxation on investors. He added the Kenya Revenue Authority and the Ministry of Finance do not seem to be reading from the same page, taxing even goods and ventures that have been zero rated, in what he refers as challenges resulting from signal inconsistencies.

“For any investor who wants to run a multi country organisation in Africa they must pay attention to tax, I would caution anyone in such a project. Regional tax treaties are non-existent, regional tax collectors trying to increase collection, fairly hefty market rigidities,” he said.

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