What kind of investment can I find in Kenya?

First and foremost, Kenya is the leading investment economy in East Africa; I am not saying that because I am Kenyan but because it is a true fact. Its strategic location and its well developed business infrastructure makes it a natural choice for investors and many international firms have made it their regional hub.

I say this fully aware of the fact that no nation can be built from its own resources alone. If this country is to move forward and take its place among the family of modern nations, we must be able to attract resources from other countries in the world. We are aware that globalization has opened up wide opportunities in Europe, China and South East Asia. There is, therefore, high competition for international resources. In addition, foreign capital is not easy to attract because investors are cautious people. Investor funds are most readily attracted to countries with a stable not forgetting a predictable social, political and macro-economic environment.

For a number of years, Kenya's performance in attracting and retaining private capital flows was not particularly encouraging. In my view, we should not dwell too much on what happened, because most of us know the circumstances under which Kenya had stopped being the preferred regional destination of foreign business. Instead, I would like us to think more in terms of what we can and must do, to remain attractive to those of you who are already here, and those who want to continue doing business in Kenya.

East African Community

Kenya now also provides access to the larger regional market of the East African Community (EAC) which was formed by its three partner states (Kenya, Tanzania and Uganda) in 2000 and which had 93 million consumers at that time.

Our aim is to create a hospitable business climate that will make Kenya the favorite investor destination in this region. The Government is committed to maintaining a macro-economic environment that will inspire investor confidence and long-term business plans.

Agriculture, manufacturing and tourism

The agriculture, manufacturing and tourism sectors account for 24%, 13% and 12% of Kenya's gross domestic product respectively. These three sectors also account for the largest number of employment opportunities in Kenya to date. Agriculture generates 60% of foreign exchange earnings but there is considerable potential for diversification and expansion especially in the area of non-traditional exports such as coffee, tea , sisal, pyrethrum, corn, and wheat that are grown in the highlands not forgetting coconuts, pineapples, cashew nuts, cotton, sugarcane, sisal, and corn that are grown in the lowland areas.

Services sector

Tourism is Kenya's second largest foreign exchange earner. The mass appeal of the country's scenery, wildlife, climate and tropical coastline has allowed the establishment of a large hotel industry and a sound tourism base. Kenya has the best developed hotel industries offering on an average some 31,400 beds per night. The high standard of services in Kenya hotels is assisted by the Utalii College which offers training programmes in all aspects of tourism and catering.

Kenya prides itself in its large pool of professional workers, trained both within the country and in institutions in Europe, North America, Australia and other parts of the world. Kenya also has a well developed education system, with the primary language of instruction being English. It's population growth currently exceeds the rate of economic growth, resulting in high unemployment. Nonetheless, there exists a large pool of English speaking workers, trained in various professions therefore by investing in Kenya's tourism sector you would have access this work force and assist in building the economy by creating employment opportunities.

All are welcome to explore the immense untapped potential and trade opportunities in Kenya, there are numerous prospects for major ventures particularly in the hotel and tourist-related industries.

Imports and shipping into Kenya

Mombasa, the main principle seaport of Kenya, has served as a major distribution hub for the lucrative market providing connections to landlocked neighboring nations. The port of Mombasa is linked to the world’s major ports with over 210 sailing per week to ports in Europe, North and South America, Asia, Middle East and Australia. The leading imports are machinery, transportation equipment, consumer goods, and petroleum and petroleum products.

Kenya offers tax incentives to local and foreign investors in the form of tax holidays, allowances, lower duties on intermediate capital goods and gradual reduction of corporate tax rates. Imported goods are subject to customs and pre-inspection certification.

Employee taxes are based around a pay-as-you-earn income tax deduction, a national social security fund and a national hospital insurance levy.

Energy sources

Petroleum is the largest source of energy in Kenya and has a wholesale effect on aggregate prices throughout the economy. Petroleum accounts for 26% of Kenya's imports in monetary terms.

Secondly, the jatropha plant grows naturally in these areas making it a very cost effective business venture.

Kenya receives on average 325 days per year of sunlight therefore favoring the application of solar power because of the abundance of sunlight. Solar technology may have a higher starting cost than that of conventional fossil fuel, the low maintenance and operation cost and the ability to operate without fuel makes the solar powered systems cheaper to keep running for an indefinite period of time. Please click the link for more information on investments in renewable energy within Africa. Renewable sources of energy will help put a stop to the several problems that Kenyans experience currently such as:-

(i) The high cost and fluctuation of price of electricity that discourage investors, thereby greatly contributing to the slow expansion of the economy.

(ii) The increase in production costs as a result of high electricity costs that lead to Kenyan commodities being less competitive on the local and international markets.

(iii) Lack of clean drinking water due to the absence of water purifiers. Solar powered purifiers require minimal maintenance and will reduce the number of people falling ill because of drinking unpurified water in rural areas.

These factors retard industrial growth and therefore hamper job opportunity growth, consequently diminishing purchasing power of the citizen.

Apart from the aforementioned activities there are also several opportunities within Kenya from which business-minded individuals can earn substantial revenue and some examples of these include areas such as real estate , taking up the establishment of business consultant services which are extremely profitable. Moreover, you could also buy shares and securities in the Nairobi Stock Exchange market or venture into the promotion of online advertising which is one of the few markets that hasn't been utilized to it's full potential by most entrepreneurs in this country.

Laws that govern investment activites in Kenya

Foreign Investment Promotion Act 2004

It is an act of Parliament that was enacted in 2004 to assist foreign investors in obtaining licenses necessary to invest and by providing other assistance and incentives and for related purposes. Any foreigner who intends to invest in Kenya shall have to apply to the Kenya Investment Authority for a certificate. If the application is complete and satisfies the applicable requirements under this act then the applicant shall be entitled to the certificate.

The following are used in determining whether a venture and the activity related to it are beneficial to Kenya:-

a) creation of employment for Kenyans.

b) acquisition of new skills or technology for Kenyans.

c) contribution to tax revenues or other Government revenues.

d) a transfer of techno1ogy to Kenya.

e) an increase in foreign exchange , either through exports or import substitution.

f) utilization of domestic raw materials, supplies and services.

g) adoption of value addition in the processing of local, natural and agricultural resources.

h) utilization, promotion, development and implementation of information and communication technology.

All foreign personnel coming to work in Kenya must have an entry permit, usually referred to as a "work permit". A foreign worker’s dependants require dependants' passes. Application inboth cases has to be made to the Principal Immigration Officer. Non-citizens of Kenya also require Aliens Registration Certificates and should obtain re-entry passes if they traveloutside Kenya. All these permits are usually valid for two years.

It is my hope that you will be of help to the country in selling existing and new opportunities to potential investors in addition, I would, therefore, like to take this opportunity to encourage all individuals to take advantage of the new business environment and invest in Kenya.

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