We need more EAC companies spreading out

As I was writing this, the Dear Brother Leader, Guide of the Libyan revolution, was still in hiding and a hurricane named Irene was destined for the Eastern coast of the USA. In Nigeria, the terrorist group Boko Haram had just launched a deadly attack on the UN headquarters in Abuja claiming 18 lives. However my focus was drawn to an event whose significance was rather under reported. The day was August 11 and somewhere in the posh environs of Nairobi, KFC opened its first outlet in the East African region. KFC stands for Kentucky Fried Chicken, one of the world’s leading fast food retailers originating from Louisville Kentucky. It is currently operates more than 12, 300 outlets in over 80 countries. On its first day, hundreds of ‘Nairobians’ flocked the outlet, with some having to wait for so long just to get served. KFC plans to open two more outlets in Kenya before the year ends and also intend to spread to Uganda and Tanzania in the next three years. Last week I met two US Peace Corps ladies and when I told them about KFC opening in Nairobi they seemed a little disappointed. According to them KFC is often associated with the unhealthy fast food culture that seems to account for the obesity epidemic in the US and other developed nations. The arrival of KFC may seem like a sign of approval that East Africa is ready for investment and actually some have already predicted that this development, will herald a rush for other US chains like McDonald’s, Pizza Hut and Burger King among others. These firms are targeting the growing middle class citizens in East Africa who seem bent on copying western lifestyles and consumerism. Eating at KFC is considered by some to be a status symbol giving one the satisfaction of having achieved a level of financial comfort. I remember doing a story in 2006 where I argued that most of globalisation is actually an excuse for Americanisation as large US multinationals continue to make footprints in previously virgin markets. Already something bigger than KFC is headed to East Africa, supermarket chain Wal-Mart Yes Wal-Mart has already signed a $ 2.4billion deal to acquire a 51% stake in South Africa’s largest chain retailer Massmart. Massmart has over 228 stores in South Africa and operates brands like Game supermarket which already has an outlet in Kampala, Uganda. It will only be matter of time before we have KFC, Wal-Mart and possibly McDonald’s here in Kigali. This sounds good for our governments that are always trying to attract investors. However, it presents challenges and vital questions for East African business people and East Africans in general to ponder. If indeed KFC is associated with the obesity problems facing many in the US, is our health sector ready to deal with the rise in heart diseases that may arise from the growing culture of fast foods? Will our smaller companies manage to compete with large chains like Wal-Mart? What about the labour practices of Wal-Mart? Will our governments have the spine to deal with these large firms if they are found to be exploiting local labour? As an East African I am more interested in seeing Nakumatt, Uchumi, Ukwala, Simba or even Capital Shoppers all over the region before Wal-Mart gets here. I dream of seeing Bourbon coffee, Shokola, or Rwenzori coffee having a presence in all the East African capitals before I can see a Starbucks. Already there is a large presence of South African firms like Stanbic Bank, SABmiller, Engen, Woolworth’s, Shoprite, Mr. Price and Game in several parts of East Africa. When will East African firms spread to other parts of the region? My prayer is that East Africa becomes more modern and ‘East African’ without necessarily being more American or Western. The pace so far is a little discouraging. Only Kenyan firms seem to have the capacity to cross borders and spread their wings. Kenyan Banks like KCB, Fina Bank and Equity bank have spread out already. We have seen Nation Media group also spreading as well as Nakumatt and Uchumi stores. I only wish our governments could offer more incentives to companies in Tanzania, Uganda Rwanda and Burundi to spread to other capitals. I would love to eat at KFC is Nairobi but I will feel happier if I was taking Rwandan coffee or Nyiragarama products in Kisumu. We can do this. Email: ssenyonga@gmail.comBlog: ssenyonga.wordpress.comTwitter: @ssojo81