Kenya has one of the best vehicles to promote new investment into Kenya called KenInvest which is the branding for the Kenyan Investment Corporation. Here are 9 macro-reasons to invest:
- Tax Treaties and Investment Promotion and Protection Agreements: Kenya is a signatory to a large and growing number of tax treaties and investment promotion and protection Agreements such as the Multilateral Trade System (MTS) ACP Cotonou Agreement, and the Africa Growth and Opportunities Act. This allows exports from Kenya to enjoy preferential access to world markets under a number of special access and duty reduction programs.
- Stability: Since independence, Kenya has maintained remarkable stability despite changes in its political system Since the re-emergence of multiparty democracy and promulgation of a new constitution in 2011, Kenyans have enjoyed an increased degree of freedom.
- Regulatory 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 simple and transparent and focused on legitimate regulatory purposes.
- Access to Large pool of Highly Educated and Skilled Work Force: Kenya prides itself in its large pool of highly educated, skilled and sought after work force in Africa, trained from within the country and in institutions in around the world.
- Strategic Location: As the leading economy in East Africa, Kenyas’ strategic location and its well developed business infrastructure make it a natural choice for investors and many international firms have made it their regional hub. This grants investors access to the larger East African Community and regional markets with access to over 385 million consumers. Nairobi is also a major transport Hub in East Africa with Connections from Jomo Kenyatta International Airport to Major Destinations around the world. All these are coupled with a convenient Time zone of (GMT +3).
- Highly Developed Social and Physical Infrastructure: Kenya affords a pleasant and quality standard of living with its spectacular and diverse natural resources. Ranging from wildlife and sceneries. Including the world famous Maasai Mara. The country also boasts of high quality social amenities such as restaurants, hospitals and Entertainment spots. A good reason why the country has the highest number of Expatriates living and working in Kenya.
- Fully Liberalised Economy: Kenya fully liberalised its economy by removing all obstacles that previously hampered the free flow of trade and private investment. These includes exchange controls, import and export licensing, as well as restrictions on remittances of profits and dividends.
- Preferential Market Access: Kenya is signatory to a number of multilateral and bilateral trade agreements as part of its trade policy. Kenya is a member of the World Trade Organization (WTO) making her products access more than 90% of world markets at Most Favoured Nation (MFN) treatment. In addition, Kenya is member to several trade arrangements and beneficiary to trade-enhancing schemes that include the Africa Growth and opportunity act (AGOA); ACP-EU Trade Agreement and Common Market of Eastern and Southern Africa (COMESA).
- Well Established and Vocal Private Sector: Kenya has a very substantial private sector, including a significant number of foreign investors and is touted as one of the most resilient in the world. The country has always been a market economy. Key players in voicing private-sector concerns include, The Kenya Private Sector Alliance (KEPSA), Federation of Kenya Employers (FKE) and The Kenya Association of Manufacturers (KAM). Futhermore, the government frequently conducts regular policy dialogue with private sector players through the Prime Minister Round Tables.
Farming is the backbone of the economy, giving vocation to around 75 for each penny of the populace. There is impressive degree for broadening and extension of the horticultural division through quickened nourishment trim generation, handling and advertising. There are additionally open doors for development in innovative foundation, for example, bundling, hoarding, and transportation. Escalated water system and extra esteem included processing are fine zones for profitable investment. In broader categories, opportunities exist in the follow sub-sectors of the agricultural economy:
- Value addition processing. e.g. Coffee, Tea and Fruits
- Floriculture and Horticulture
- Marketing infrastructure – wholesale and export; transportation from farms to markets; cold storage within or near airport for fresh produce
- Development of Multipurpose dams
- Irrigated Agriculture Program for industrial crops such as cotton, sisal, tea, nuts, fruits and vegetables and coffee among others
- Fisheries development and management
- Establishment of Disease free zones
- Development of abattoirs
- Large scale animal production for milk and meat
Manufacturing Investment Opportunties
Kenya has a very much created development industry. With growth in populace, openings exist in the development of private, business and mechanical structures, including pre-assembled minimal effort lodging. Broad open doors for venture exist especially in the territory of redesigning ghettos and casual settlements, urban restoration, development of center and low pay lodging, fabricate and supply of building materials and parts. Producing part is a territory where speculation openings exist. The division assumes a vital part in increasing the value of horticultural yield. An extensive variety of chances for immediate and joint-wander ventures exist in the assembling division, including agro-preparing, fabricate of articles of clothing, gathering of car parts and hardware, plastics, paper, chemicals, pharmaceuticals, metal and building items for both household and fare markets.
Energy Investment Opportunities
In Kenya, energy is identified as one of the infrastructural enablers of the three pillars of Vision 2030, with an expected surge in energy use within the commercial sector on the road to 2030. As a result, the government has identified the need for generation of additional energy and efficiency in energy consumption as priorities in Vision 2030. In order to promote renewable energy projects like wind and solar energy development programme on a commercial scale, the Government of Kenya (GoK) has also introduced Feed-In Tariff (FIT) policy to attract private investments.
The policy provides a fixed tariff for electricity generated in grid connected mode.
The main sources of energy are wood fuel, petroleum and electricity accounting for 69%, 22%, and 9% of total energy use1 respectively. More precisely, 67.5% of electricity is generated using renewable energy sources which are predominantly Hydro with 47.8%2 and Geothermal with 12.4% respectively, while 32.5% is from fossil fuels. The total electricity which is generated is shared by less than 20% of population of the country, and more than 80 percent of the population remains without access to the electricity.
In 2012, the Government announced the discovery of oil in Turkana County. This followed extensive exploratory efforts in areas such as Lamu and Isiolo. Efforts to establish the commercial viability of the oil find are underway, with an expected timeline exceeding three years before the country can become an oil producer. The discovery has been described as a major breakthrough that will contribute significantly to the meeting the country's energy requirements
The confirmation of commercially viable deposits of coal in the Mui Basin, in Mwingi East, Mwingi Central and Mutitu Districts means that Kenya is set to join the coal mining nations of the world. This discovery of coal is expected to go a long way in filling the energy deficit in the country
Kenya is endowed with vast geothermal potential and is recognized as one of the leading generators of geothermal power in Africa; it is estimated that the country has 7,000 MW – 10,000 MW of geothermal potential and it is currently Africa's largest geothermal producer with 210 MW of capacity. The discovery of commercially exploitable geothermal steam in Menengai contributed to the country's energy portfolio that will drive the Kenya toward the achievement of Vision 2030. The Kenyan Government has recently initiated the Scaling-up Renewable Energy Program (SREP) investment plan in line with national renewable energy development strategy
Innovation and IT Investment Opportunities
Kenya has completely grasped the open doors managed by innovation. The bubbly start-up scene is something to be appreciated. This has been floated by great government approaches, with the extent of the neighborhood ICT advertise now is evaluated at around $500 million. The National ICT Masterplan plans to improve Kenya's aggressiveness through usage of its assets in Business Process Outsourcing and fortifying its abilities to meet future innovative difficulties. The 2030 vision for BPO is for the nation to end up distinctly the top BPO goal in Africa.
The size of the local ICT market is estimated at US$ 500 million and it is of note that companies such as Spanco, followed Airtel into Kenya to continue servicing them. These companies are expected to expand into the region , given Kenya's its relative sophistication compared to neighbouring markets, and in order to service clients' expansion plans into the EAC and beyond.
- Kenya is a home a large number of highly educated and innovative talent - the country is known for innovation as demonstrated by the all very well known MPesa Software for some of the best banks in the world.
- Kenya is a Stable pro-investment government - the new Constitution that became law on 1st Aug 2010 has cemented the stability and guaranteed investors and citizens alike rights that promote economic and social growth.
- Kenya has instituted business friendly regulatory reforms - We are repealing and continue to repeal laws and regulations that impede investment. We have also enacted the Investment Promotion Act (2004) that has set up Kenya Investment Authority to assist you in obtaining licenses necessary for investment and to provide you further assistance and incentives.
- Kenya is at a strategic location as a regional financial, communications and transport hub - Our strategic location and well developed business infrastructure makes us a natural choice of location as a base for you regional offices and operations.
All the above factors coupled with the friendly business environment and an innovative culture have made Kenya a premier outsourcing destination and facilitated the formation of strong local BPO/ITES companies such as Kencall (awarded best non- European Call Centre, 2008), Horizon Contact Centres, Direct Channel, TechnoBrain (former Kentech data), Adept Systems and Craft Silicon, a leading software development house. There is equally notable interest from a number of international outsourcing currently at various levels of feasibility studies. Kenya is also host to regional offices for the world’s biggest technology companies including Microsoft, Google, Cisco, Oracle, IBM and SAP.
Tourism Investment Opportunities
Kenya at present brags the most noteworthy impart of populace to access to budgetary administrations in Sub-Saharan Africa (more than 70 percent). This is to a great extent on account of the well-known portable cash exchange benefit M-Pesa. Konza City, a cutting edge techno polis is a venture by the Kenyan government which guarantees to drive considerably more development in the ICT division.
Tourism is one of Kenya's leading foreign exchange earner and third largest contributor to the GDP after agriculture and manufacturing. The sector has been growing fast as a result of various factors such as liberalization, persification of tourist markets and continued Government support and commitment to providing an enabling environment, coupled with successful tourism promotion and political stability.
Investors can take advantage of Kenya's endowement of unique and perse combination of tourist attractions such as beautiful coastal beaches, coral reefs, caves and river deltas, abundant wildlife including the ‘big five’ in their natural habitats, national parks and game reserves, good climate, beautiful geographical landscapes, savannah grasslands, forests, salt and fresh water lakes. Others include hot springs, mountains, botany and zoology, world heritage sites, and rich cultural history.
Out of the 26 Parks and Game Reserves in Kenya, only 7 parks including Masaai Mara, Nakuru and Amboseli are fully operational accounting for more than 80% of the total number of visitors. This presents an opportunity to develop and add value to the other parks with modern facilities and infrastructure.
Investors can also take advantage of several strategies and programmes that have been earmarked by the government to attract investments into the industry such as establishment of three resort cities, branding of premium parks, development of high value niche products, development of a replica of Kenya Utalii college at the Coast, and building of new high- end international hotels chains among others.