Opportunities for Investment
Opportunities for investment in Kenya exist in the following areas, click to view
Why invest in Kenya
- EAST AND CENTRAL AFRICA’S LARGEST ECONOMY
Kenya is the largest and the most advanced economy in East and Central Africa; with strong growth prospects supported by an emerging, urban middle class and an increasing appetite for high-value goods and services.
Strong and large Regional player
Kenya is the dominant economy in the East Africa Community, contributing to more than 50 per cent of the region’s GDP.
Growing consumer market
Kenya has the second largest population within the EAC at 43 million and is growing at a rate of 2.7 per cent per annum. There is a rising trend towards urbanization, which is contributing to an increase in consumer demand for high value goods. This trend is forecasted to continue, with 50 per cent of the population expected to live in urban areas by 2050.
- LOW RISK INVESTMENT ENVIRONMENT
Kenya’s investment climate is the strongest in the EAC, with FDI flowing in from emerging and developed markets and a high volume of multinational companies with regional and continent-wide headquartered in the country.
- STRATEGIC GEOGRAPHICAL LOCATION
Kenya’s geographical location makes the country ideal for strategic partnerships aimed at improving regional and global market share.
Regional connectivity
Kenyan infrastructure, including the Ports of Mombasa and the KE-UG railway, is the gateway to the vibrant East and Central Africa region.
International connectivity
Jomo Kenyatta International Airport functions as an effective air hub between Africa, Europe
- WIDE MARKET ACCESS
EAC
Member Countries; 5: Population: 143.5 million Total GDP: $110.3 billion Source: EAC Facts & Figures Report (2014)
Kenya’s membership of regional economic blocs, coupled with its strategic geographic position, make the country the gateway to the huge EAC and COMESA regional markets and a beneficiary of several preferential trade arrangements.
COMESA
Member Countries: 20: Population: 469 million Total GDP: USD 636 billion Source: COMESA (2013)
PREFERENCIAL TRADE TREATMENT
Kenya is a member of several trade arrangements and beneficiary of trade promotion schemes that include the Africa Growth and Opportunity Act (AGOA), World Trade Organisation and EAC-EU Trade Agreement.
TRIPARTITE (EAC-SADC-COMESA)
There will soon be Tripartite Free Trade Area (FTA) cooperation, a regional bloc of the EAC, COMESA & SADC nations – creating a potential market of over 600 million.
Strategy
- Market Integration
- Infrastructure development
- Industrial development
Pillars
- Harmonization and improvement of functionality of regional trade agreements and programs
- Trade promotion
- Joint planning and implementation of infrastructure programs
- Free movement of business persons within the region
- POLITICAL STABILITY & FAVOURABLE INVESTMENT POLICY
Empowered by a new constitution and administration, the national and county Governments are approaching the private sector as a central partner in the development and growth of the Kenyan economy.
A new approach to the private sector
The Government regards the private sector as a key centre of economic and social development. It has signaled this shift in the Government’s orientation through the divestment of its majority shareholding in state commercial companies through the Nairobi Securities Exchange.
Business environment reforms
Kenya is making efforts to lower the cost of doing business by conducting extensive business regulatory reforms intended to substantially reduce the number of licensing requirements and to make the licensing regimes more transparent and focused on legitimate regulatory purposes.
Open market access system
Kenya has fully liberalised its economy and removed all obstacles that previously hampered the free flow of trade and private investment, such as exchange controls, import and export licensing, as well as restrictions on remittances of profits and dividends.
Devolution into County Governments
Empowered by the new constitution, devolution offers an opportunity for investment through localised innovation and through collaboration, by building commercial ecosystems that expand employment opportunities and empower local communities.
Investor guarantees
- The Kenya Constitution guarantees against expropriation of private property
- No exchange controls guarantee repatriation of capital, profits and interests
- A Member of the Multilateral Investment Guarantee Agency (MIGA) and the Africa Trade Insurance Agency (ATIA), which both insure foreign investments against non-commercial risks
- A member of the International Centre for Settlement of Investment Disputes (ICSID), which arbitrates cases between foreign investors and host Governments.
- IMPROVING INFRASTRUCTURE
Kenya’s infrastructure landscape is also undergoing significant transformation as evidenced by commitment of over USD 20 billion towards infrastructure development through public-private partnerships.
Infrastructure strategy
Increasing investment in infrastructure under Public Private Partnership arrangements
| · USD 14.5 billion Konza Technology City “Silicon City” IT hub to be built on 5000 acres of land in Machakos County. | |
| · USD 5.5 billion Lamu Port Southern Sudan – Ethiopia Transport Corridor Construction of Lamu Port headquarters is in progress. | |
| · USD 3.6 billion Standard Gauge Railway links Kenya’s Indian Ocean port city of Mombasa to the capital Nairobi. | |
| · USD 654 million Jomo Kenyatta International Airport expansion comprises of a 178,000m2 facility due for completion in 2017, complemented by Nairobi Commuter Rail Service linking the city centre to the airport. | |
| · USD 366 million The Port of Mombasa harbour channel was deepened by 15 metres and widened to 500 metres to accommodate larger vessels. | |
| · USD 360 million Construction of the eight-lane controlled-access 50km Nairobi– Thika superhighway was completed in 2012. It has led to the emergence of new businesses, especially in retail and real estate including the creation of three major malls. |
- REDUCING COST OF ENERGY AND IMPROVING ENERGY AVAILABILITY
Kenya is ideally positioned to unleash Africa’s power generation capacity through its focus on green energy and cost effective sources of energy, set to contribute to a 5000MW increase in the national power grid.
Power & Energy strategy
Increasing share of power generated from green and more cost effective sources, with a target to increase electricity generation capacity by 5,000MW from the current 1,644MW to 6,700 MW in 40 months.
Key Power Project and Recent Resource Discoveries
- WIND POWER PROJECT
300 MW Lake Turkana Wind Power Project valued at USD 823 million.
- WATER DISCOVERY
Two new water sources at Turkana Basin and Lotikipi Basin holding 250 billion m3 of water, sufficient to supply Kenya for 70 years.
- OIL DISCOVERY
Discovery of reserves by Tullow oil are estimated to extract as much as one billion barrels.
- GEOTHERMAL POWER PROJECT
3,000 MW Geothermal Power Project in Baringo valued at USD 135 million.
- COAL POWER PLANT
900 -1,000MW Coal Power Plant in Lamu.
- NATURAL GAS PLANT
700-800 MW Natural Gas Fired Plant near Mombasa through a PPP.
- WELL ESTABLISHED PRIVATE SECTOR
Kenya’s private sector is substantial and includes a number of foreign investors.
Key players in voicing private sector concerns include: Kenya Private Sector Alliance (KEPSA), Federation of Kenya Employers (FKE) and the Kenya Association of Manufacturers (KAM).
- A SKILLED AND EDUCATED TALENT POOL
Kenya prides itself on its large, highly educated and skilled work force – with 55 per cent of the population aged 15-64.
- VIBRANT CAPITAL MARKETS
Foreign participation in NSE: 54.1 per cent of total equity turnover (January-June 2014)
Investment
Think investment- Think Kenya
Kenya is classified as lower middle income country by the World Bank after rebasing its economy in 2014. It is the ninth largest economy in Africa, and the fourth largest in sub-Saharan Africa.
Kenya is also the largest and most advanced economy in East and Central Africa. Its GDP accounts for more than 50 per cent of the region’s total and in terms of current market prices, its 2014 GDP stood at $58.1 billion.
Kenya was ranked third globally, after Brunei Darussalam and Kazakhstan as the most improved economy in ease of doing business according to the ‘Doing Business Guide’ published by World Bank in 2016.
The improvement was mainly helped by reforms in resolving insolvency, starting a business, protecting minority investors and getting electricity. http://www.industrialization.go.ke
Kenya has a development program espoused in the Vision 2030. In this respect, policies as well as investment opportunities have been aligned accordingly to the Vision 2030 objectives. For more information visit http://www.vision2030.go.ke/
Kenya has a wide range of mineral deposits and this has led to significant growth over the years. The country has discovered huge deposits of oil. It also has coal, soda ash, fluorspar, gemstones, carbon dioxide, iron ore, rare earth minerals, base metals and gold. http://www.mining.go.ke
Energy has been identified as one of the infrastructural enablers of the three pillars of Kenya’s Vision 2030, with an expected surge in energy use within the commercial sector. As a result, the government has formulated a power development strategy to exploit renewable resources available to her such as hydropower, geothermal, biomass, solar and wind energy. The government has undertaken legislative reforms sector to attract more investment in the growing sector.
For more information visit
- Electricity Regulatory Commission
- Geothermal Development Company (GDC)
- Kenya Electricity Generating Company (Kengen)
- Kenya Electricity Transmission Company (Ketraco)
- Kenya Power
- Ministry of Energy
- National Oil Corporation
- Renewable Energy Portal
SPECIAL ECONOMIC ZONES
The Government plans to roll out Special Economic Zones (SEZs) to boost Kenya’s investment profile. This will replace the current Export Processing Zones (EPZ).
The focus of the new policy on SEZs is that goods be produced closer to raw material sources and investors handed preferential terms on matters such as licensing.
President Uhuru Kenyatta in September signed the Special Economic Zones Act 2015, which spells out key measures to revamp activities in the blocs. View Act
The special economic zones law provides incentives for industries to operate in designated zones.
The Act provides for numerous tax incentives for investors, including exemption from all existing taxes and duties payable under the Customs and Excise Act, Income Tax Act, East African Community Customs Management Act and Value Added Tax Act on all special economic zone transactions.
Enterprises at the SEZs will enjoy several tax incentives under a tightly monitored set-up to avoid losses of government revenue. The preferential tax terms will include value added tax (VAT) exemption on all supplies of goods and services to enterprises, reduction in corporate tax to 10 per cent from 30 per cent for a period of 10 years of operation and 15 per cent for the next 10 years.
The government plans to freeze new investments within its Export Processing Zones (EPZ) as it takes up the SEZs model.
The SEZs are currently undergoing a pilot program in Mombasa, Lamu and Kisumu.
Click here for more information on Special Economic Zones
Trade
Kenya is the gateway to Eastern and Central Africa regions. Her developed infrastructure and membership in the East African Community (EAC) and Common Market for Eastern and Southern Africa (COMESA) make Kenya the ultimate trade and investment destination.
The country’s strategic location provides easy access to the EAC market with about 140 million people and COMESA with a population of 400 million.
Kenya’s Main trading partners include Uganda, Tanzania, Rwanda, Burundi Egypt, South Africa, European Union (EU) United Kingdom, Saudi Arabia, United Arab Emirates, United States of America, Japan, Pakistan and India.
EXPORTS
Kenya’s major exports to the world include: Tea, Coffee, Sisal and sisal products Fish and fish products, Fresh fruits and vegetables, Nuts, Dairy products ,Honey, Cut flowers, Handcrafts, Tobacco and tobacco products ,Plastics, Rubber, Raw hide and skins, Paper and paper board, Woven textile products, Petroleum products, Cement, Pyrethrum extracts, Livestock and livestock products, Processed foods, Textiles and apparels, Aluminum, iron & steel ,Limestone, Soda ash ,Fluorspar, Precious and semi-precious stones and tourism.
The largest destination for Kenya’s exports is the East African Community (Uganda, Tanzania, Rwanda and Burundi) and the Common Market for East and Southern Africa (COMESA).
Kenya’s exports to the region are dominated by manufactured and semi-manufactured products, including refined petroleum products, metal scrap, beer, cigarettes, oils, perfumes, articles of plastic, consumer products and fabrics and exports agricultural products like tea of where our main markets are Pakistan, Egypt, UK.
The European Union (EU) is the second most important export destination for Kenya’s products. Kenya is the lead exporter of flowers to the European Union (EU) with a market share of over 35%. EU is also the principal importer of Kenya fresh produce (fresh fruits and vegetables).
Other major export destinations include, United States of America, Middle East and Asia region
Imports
Kenya major Imports from the world include: Machinery and transportation equipment, Petroleum products, Motor vehicles, iron and steel, Resins, Plastics, agricultural products, Fish and fish products, Paper and paper products ,Iron and steel, Textiles, Cosmetics, Leather products, Pharmaceuticals, Fertilizer, Construction materials, Processed foods ,Electrical products.
For more information visit http://www.industrialization.go.ke
Fisheries
Kenya has developed and incorporated the EU standards for all fish products destined for both domestic and external markets.
The State Department of Fisheries is the Government agency mandated to provide for the exploration, exploitation, utilization, management, development and conservation of fisheries resources, and undertake research in marine and fresh water fisheries. http://www.fisheries.go.ke
The dairy industry
Kenya exports dairy products to the East and Central Africa, European Union and Middle East. Kenya has developed standards for all dairy products produced within the EAC and COMESA regions. In addition, and most important is that Kenya is among the developing countries from which the EU member states are authorized to import milk and milk based products.
The Kenya Dairy Board regulates activities in the industry and presents a one stop point for investors eyeing the dairy industry. http://www.kdb.co.ke
Leather, Hide and Skins
LEATHER, HIDES AND SKINS SECTOR IN KENYA
The leather industry in Kenya is mainly dependent on the large livestock resource base of Cattle, Goats, Sheep and Camel. The industry also derives its raw materials from emerging livestock such as fish (Nile perch), farm Ostriches and farm Crocodiles.
The sector’s contribution to Kenya’s economy currently stands at Kshs.10.6 billion and creates employment to over 22,540 people directly and indirectly.
Hides and skins subsector
The hides and skins trade has gone through phases; witnessing positive impact on the sector. The sector transformed from a purely raw material source to relatively modern industry adopting the changing technology and market trends. The transformation saw the country act as a tanning hub for the region through procurement of hides and skins and supply of leather in both local and regional markets. In addition, it experienced exports of semi- processed leather (wet-blue) to the international markets.
Tanning subsector
Currently, tanneries in Kenya have installed capacities standing at 60% for wet-blue, crust leather at 25% and finished leather taking 15%.
Leather goods and footwear subsectors
The leather goods and footwear subsectors in Kenya have exhibited a lot of potential for growth with an increase of leather goods units to 85. There are 25 enterprises engaged in formal footwear and leather goods manufacturing. This has a utilization capacity of more than 70%. Apart from the formal sector, there are hundreds of informal footwear manufacturing units/ Small and medium enterprises (SMEs) which undertook manufacturing of 55-60 percent of the local footwear production.
Cabinet Secretary for the Ministry of Industry and Trade, Mr. Adan Mohamed (2nd right) sampling some of the Kenyan leather products
INVESTMENT IN THE LEATHER SECTOR
- Exports
To be able to trade externally, one requires a minimum of Kshs 5 million. The Department of Veterinary Services provides technical advice to exporters to help them succeed in export of hides, skins and leather.
- Raw hides and Skins
The Kenya Revenue Authority (KRA) on behalf of the Government levies 80% tax of the Free on Board (FOB) value. On the other hand, the Department of Veterinary Services levies 2% of the FOB to fund the Veterinary Services Development Fund (VSDF).
- Wet blue leather
The Veterinary Department levies 1% of the FOB value; KRA does not charge any levy thus encouraging value addition.
- Crust leather
0.5% of FOB value is charged by the Veterinary Department which goes to VSDF. KRA does not charge any levy.
- Finished leather
No levies are charged by both KRA and the Department of Veterinary Services.
Note: Taxes and levies by KRA and the Department of Veterinary Services are paid prior to export of goods.
FOREIGN INVESTMENT CONDITIONS
Special Economic Zones (SEZs)
The Government plans to roll out Special Economic Zones (SEZs) to boost Kenya’s investment profile. This will replace the current Export Processing Zones (EPZ) and is marked to improve foreign Direct Investments into the country.
The focus of the new policy on SEZs is that goods be produced closer to raw material sources and investors handed preferential terms on matters such as licensing.
President Uhuru Kenyatta in September signed the Special Economic Zones Act 2015, which spells out key measures to revamp activities in the blocs.
The special economic zones law provides incentives for industries to operate in designated zones.
The Act provides for numerous tax incentives for investors, including exemption from all existing taxes and duties payable under the Customs and Excise Act, Income Tax Act, East African Community Customs Management Act and Value Added Tax Act on all special economic zone transactions.
Enterprises at the SEZs will enjoy several tax incentives under a tightly monitored set-up to avoid losses of government revenue. The preferential tax terms will include value added tax (VAT) exemption on all supplies of goods and services to enterprises, reduction in corporate tax to 10 per cent from 30 per cent for a period of 10 years of operation and 15 per cent for the next 10 years.
The government plans to freeze new investments within its Export Processing Zones (EPZ) as it takes up the SEZs model.
The SEZs are currently undergoing a pilot program in Mombasa, Lamu and Kisumu.
Quality Assurance
All producers in the leather sector are required to comply with the standards set by the Kenya Bureau of Standards (KEBS) and other relevant International Standards bodies in production of quality leather and leather goods.
Environmental legislation
Manufacturers and business people in the leather sector must comply with the National Environment Management Authority (NEMA) legislation.
For more Information Contact:
The Secretary/CEO
Kenya Leather Development Council
Tel: +254 (020) 4442321
P.O Box 14480-00800
Riverside Drive- Nairobi.
E-mail: ldckenya@gmail.com
http://www.leathercouncil.go.ke
LEATHER GOODS ENTERPRISES IN KENYA
| No. | Company | Product Range | Contact Details |
| 1. | Adelphi – The Leather Shop | Diverse range of quality leather items including:
Bags, Hand bags, folders, wallets,briefcases, accessories as well as Corporate Gift Items. |
Tel:- +254 (20) 236 9694
Email: info@adelphileather.biz https://www.adelphileather.biz Outlets: – Yaya and Sarit Centre, Nairobi. |
| 2. | Sanabora Design House Limited | Quality and contemporary leather items with an African touch including:-
Clutch Bags, Cross body bags, hand bags, wallets, purses, travel bags, gifts/corporate items. |
Murang’a Road, Opposite K.I.E, Aqua Plaza, 3rd Floor, Nairobi.
Tel: +254 20 232 1853, Mobile: +254 715 774 579 Email: info@sanabora.com Website: http://sanabora.com |
| 3. | Habib Leather Industry | Producers of High Quality Leather Products including:-
Corporate Gift Items, Sports Items and Items for the Catering and Hotel Industry |
Cell Phone: 0725 103 705
Email:habibleatherindafrica@yahoo.com Cell Phone: 0725 760 681 |
| 4. | Gonzala Leathers | Producers of a wide array of quality leather products. | Email: anzalaof@gmail.com
|
| 5. | Rift Valley Leather | Range of production include:-
Travel bags and holdalls (briefcases), Satchels, wallets and purses, belts as well as handbags and bespoke items in exotic leather. |
Tembo Road, Karen – Nairobi.
Contact:- +254 (0) 721 922 Email:enquiries@riftvalleyleather.com Website: https://www.rift-africa.com |
| 6. | Zeeban Designs | Producers of Quality Leather Accessories including:-
Hand bags, wallets and purses. |
Outlet: Yaya Centre, Nairobi.
Cell Phone: +254 734 446 316/ +254 723 425 098 E-mail: zeebaan@gmail.com http://www.honeyfromthemoon.com |
| 7. | Annabelle Thom | Assorted leather goods | The Junction shopping Mall, Dagoretti Corner, Nairobi
Tel: +254 (020) 3864 665 Email: sales@annabellethom.com www.annabellethom.com |
| 8. | African Lily | Leather accessories | Ngong Road
P.O Box 26015 – 00100, Nairobi Cell: +254 710 492147/ +254 725 106542 |
| 9. | Adel de jak | Assorted leather goods | Cloud 9 Collection
Mushroom Road off Kiambu Road, Nairobi Cell: +254 (0)734 399 800 |
| Escon Leather Company | Producer of high quality vegetable tanned leather accessories and interior decor including:-
Wallets, pouches, purses, clutch bags, handbags, ladies sandals, doormats and poofs. |
Contact: essymumo@gmail.com | |
| 10. | Anchor Footwear | Producers of men’s office shoes in a diverse range of tastes and preferences. | Contact: artur.mwaura@gmail.com
Outlet:– Kenya Industrial Estates. |
| 11. | Kraw Leathers | Producer of leather bags, sandals, purses, footwear among other leather accessories | Industrial Area
P.O Box 7637-00300, Nairobi Cell: +254 722 938 387 Email: Karuga.nganga@gmail.com |
TANNERIES OPERATING IN KENYA
| No | Name of the Tanner | Postal Address | Emails |
| 1. | Bata Shoe Limited
(Limuru Town) |
P O Box 23 – 00217 LIMURU | bata.marketing@ bata.com
customer.service.kenya@ bata.com |
| 2. | Alpharama Ltd
(Off Namanga Road, ATHI RIVER) |
P O Box 167 – ATHI RIVER | info@alpharam.co.ke |
| 3. | Leather Industries of Kenya
(Off Garissa Road, THIKA) |
P O Box 79 – THIKA | likkenya@yahoo.co.uk |
| 5. | New Market Leather Factory
(Nanyuki Road – NAIROBI) |
P O Box 14579 – NAIROBI | ngombenmls@gmail.com |
| 6. | Aziz Tanneries Ltd
(Off Kangundo Road, Njiru Market) |
P O Box 1363 – NAIROBI | aziztanneries@yahoo.com |
| 7. | Sagana Tanneries Ltd
(Sagana Town) |
P O Box 94 – SAGANA | Yassin.awale@gmail.com |
| 8. | Nakuru Tanneries Ltd
(Shabab Estate – NAKURU Town) |
P O Box 225 – NAKURU | ntwetblue@africanline.co.ke |
| 9. | Dogbones Ltd
(Dandora Market, NAIROBI) |
P O Box 78010 – 00507 viwandani | ashwin@dogs.b.com |
| 10. | Nairobi Tanneries Ltd
(Nanyuki Road, NAIROBI) |
P O Box 689 – SARIT CENTRE | Chitti9aug@yahoo.com |
| 11. | East Africa Tanneries Ltd
(Off Kangundo Road, Njiru Market) |
P O Box 46227 – NAIROBI | ea_leather@yahoo.com |
| 12. | Faaso Import and Export
(Lunga Lunga Road – NAIROBI) |
P O Box 78010 – 00507
NAIROBI |
|
| 13. | Athi- River Tanneries
(Off Mombasa Road – ATHI-RIVER) |
P O Box 503 – 00204 ATHI-RIVER | md@athirivertanneries.co.ke |
| 14 | Abdulwadood tanners LTD | Po Box 41695 Nairobi | awt@kenyaweb.com |
| 15 | MAS Trading Company | Po Box 71460-00622 Nairobi | Mohamed-abukar@yahoo.co.uk |
The beef industry
Plenty of opportunities exist in this industry including beef cutting, slaughtering and production and marketing of meat and by-products; harvesting and processing of leather to meet the high domestic demand as well as external market (the EU and middle East); rearing of animals for production of game meat; poultry farming; provision of affordable technologies and equipment for small-scale processing and provision of credit to the sub-sector.
For more information visit http://www.kenyameat.co.ke and Kenya livestock Marketing Council (KLMC) http://livestockcouncil.or.ke
Edible Oils
Kenya imports 95% of its total edible oil requirements. However, many oil-seeds such as sunflower, simsim, soya beans, rapeseed, coconut, castor and groundnuts can be grown and processed locally.
Opportunities in oilseed-processing industry will stimulate supply and meet domestic market demand.
Coconut farm at the Kenyan coast
The Government has put in place incentives in favour of importation of oilseed as raw material as opposed to processed or finished goods. In addition, investors can consider oil crop plantations, oil processing and high quality packaging for export.
Pyrethrum
Kenya is the world’s largest producer of natural pyrethrum, producing 75% of all trade pyrethrum at any given time. Pyrethrum is used to produce pyrethrin and/ or pyrethrin powder which is the most widely used natural insecticide. Given the global demand for organic insecticide, the sector provides huge opportunities in terms of seed production, plantation farming, and processing of pyrethrin insecticides and pyrethrin pesticides. http://www.kenya-pyrethrum.com and http://www.kenyan-pyrethrum.com
A pyrethrum farm in Nakuru, in the Great Rift Valley