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Kenya is East Africa’s largest economy and its economic outlook for the years ahead looks robust, despite recent challenges such as trade deficit and rising debt, a recent report said.
Compared with more volatile conditions in other parts of Africa and underwhelming growth in advanced economies, the Kenyan economy is projected to do well.
Economic indicators Official forecasts state that Kenya is set to outperform key economic indicators, with GDP growth expected to be around 6.5-7 per cent in 2015, and to continue at a similar level in the coming years. This follows a growth of 5.3 per cent in 2014, and 5.7 per cent in 2013.
The Oxford Business Group’s report was launched by Kenyan Deputy President William Ruto, at the recent Kenya International Investment Conference (KIICO) 2015 in Nairobi. The conference showcased investment opportunities in Kenya.
Reiterating the government’s commitment to making it easier and less expensive to do business in Kenya, the Deputy President pointed to the rapid improvement of Kenya’s ranking in the World Bank's ‘Ease of Doing Business’ as evidence of the government’s efforts in this regard.
The Ministry of East African Affairs, Commerce and Tourism through Kenya Investment Authority (KenInvest) hosted the second edition of KIICO, at the Kenyatta International Convention Centre in Nairobi, with the theme: ‘Think Investment, Make it Kenya’.
Kenya’s macro economic strengths, county devolution, and key growth sectors were among the main focus areas that took centre-stage during the conference, alongside focused sector- specific debates and discussions to aid investment facilitation.
Speaking to Business Line , Moses Ikiara, Managing Director of KenInvest, said in terms of the ease of doing business, Kenya provided a proper environment and robust policy framework to help propel investments. The World Bank’s ease of doing business 2016 report ranks Kenya in the 108th position from its 129th position in the previous year, he said.
“Last year, our foreign direct investment (FDI) grew 93 per cent. In the previous year, our FDI grew 98 per cent. However, FDI has not slipped, the rate of growth has reduced a little. We expect to grow even higher next year, around 100 per cent,” said Ikiara.
The World Bank ranked Kenya as the third most reformed country in its global Ease of Doing Business 2015 report. Kenya attracted investments worth $1.2 billion in 2014. For the last two years, the country has been aggressive in implementing a series of reforms.
Rising FDI Referring to data from UNCTAD (United Nations Conference on Trade and Development), Ikiara pointed out, “In 2012, Kenya attracted $259 million FDI, while in 2013, it was $514 million. In 2014, Kenya attracted $989 million, almost double, though the African Development Bank has placed this number at $1.2 billion in 2014.” Stating that the country has had a very busy year, “with a first visit from a sitting US president (Barack Obama), the visit of the Prime Minister of Italy, the Africa Travel Association meeting, and the Pope's visit,” including the nation's efforts to broker peace in South Sudan, Ikiara said the country has gained a more visible role both in the region and internationally.
He added that the country was becoming a favoured business hub, not only for manufacturing, but also for real estate, and information and communications technology. Kenya is also building a $14.5-billion information technology hub, Konza Technology City, outside Nairobi, to attract investment in business process outsourcing, software development and data centres.
The official pointed out that KIICO 2014, the inaugural session, had successfully underlined the growing interest in doing business in Kenya, with the country seeing significant uptake in opportunities in the agribusiness, apparels and textiles, leather, renewable energy, real estate, tourism and logistics sectors. The second edition (KIICO 2015) further enumerated on the many reasons why it was the right time to invest in the country.
(The writer was in Kenya at the invitation of the Kenyan Government)
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