With the devolution process and increased integration with the EAC under way, Kenya’s economy benefits from a number of competitive advantages. Decentralising state power has allowed for more growth in new areas and is expected to boost FDI. The government is also determined to better balance policy goals, boost tax revenues and rein in payrolls. Kenya in figures All change: From one-party state to major reform Interview: President Uhuru Kenyatta Viewpoint: Gao Hucheng, Chinese Minister of Commerce Unique character: A land of diversity Interview: Richard Sezibera, Secretary-General, East African Community Interview: Nicholas Wescott, Managing Director for Africa, European External Action Service A regional emphasis: Devolving power to county governments to better distribute resources Interview: Mark Simmonds, Former Parliamentary Undersecretary of State for Foreign & Commonwealth Affairs, British Foreign & Commonwealth Office A regional heavyweight: On implementing devolution and efforts to spur growth Interview: Henry Rotich, Cabinet Secretary, National Treasury Interview: James Mwangi, Chairman, Kenya Vision 2030 Delivery Board Fiscal challenges: Policy plans and fiscal targets On the agenda: Regional integration continues Interview: Vimal Shah, Chairman, Kenya Private Sector Alliance Interview: Moses Ikiara, Managing Director, Kenya Investment Authority Efforts to boost financial inclusion are paying off, with the number of Kenyans using formal financial services climbing from 27.4% in 2006 to 66.7% in 2013. However, the cost of finance for small and medium-sized enterprises remains a major challenge to the country’s long-term goals. With banks in Nairobi already having a regional outlook, the focus is on boosting the capital’s status as a financial centre. Increased efficiency: Efforts to boost the tax take Focus on numbers: Reducing the public wage bill Interview: Atul Shah, Managing Director, Nakumatt Holdings Capital matters: Higher numbers access services Interview: Njuguna Ndung’u, Governor, Central Bank of Kenya Interview: Razia Khan, Regional Head of Research for Africa, Standard Chartered Golden means: Sweet spot between tight and loose lending Interview: Habil Olaka, CEO, Kenya Bankers Association Palm of their hands: Empowering people and institutions via innovative banking products Sake of lending: Alternative options help usher customers into the formal sector Shifting gears: Reforms and new trading options are set to transform the bourse Interview: Peter Mwangi, Former CEO, Nairobi Securities Exchange Interview: Paul Muthaura, CEO, Capital Markets Authority Ambitious plans: Setting long-term goals that focus on boosting Nairobi’s position as one of the continent’s key financial centres Viewpoint: James Mworia, Group CEO, Centum Investment Company The first of its kind: The government finalises its foreign currency bond sale Stocks & bonds Bamburi Cement: Manufacturing East African Breweries: Manufacturing Equity Bank: Banking Kenya Airways: Transport Kenya Power: Utilities Safaricom: Telecoms An expansion of generation capacity will add 5000 MW of power to the grid by 2017 and 17,000 MW by 2030. Independent power producers are driving the capacity increase, following regulatory changes allowing them to operate in the country. The focus is on cheap resources, like geothermal, LNG and coal, but small-scale solar and wind are also in use. Getting covered: Premiums and coverage grow Interview: Tom Gichuhi, CEO, Association of Kenyan Insurers Black sheep of the sector: Takaful products are set to secure livestock Making gains: Diversification into new markets Continuing discoveries: Commercially viable discoveries lay groundwork for the oil industry Interview: Davis Chirchir, Cabinet Secretary, Ministry of Energy and Petroleum Interview: Martin Mbogo, Country Manager, Tullow Oil Exploration and export: A land bridge to move oil across East Africa could transform the region Scaling up: Expanding capacity and access Interview: Jay Ireland, President and CEO, General Electric Africa Interview: Ben Chumo, Managing Director and CEO, Kenya Power The price effect: Changing generation sources to bring down electricity costs A stable system: Upgrades to curb power cuts Vital resources: Clear regulation will ease private sector entry into the water sector Getting connected: Infrastructure development is set to boost the economy Removing obstacles: Addressing non-tariff barriers to trade in tandem with upgrades Interview: Michael Kamau, Cabinet Secretary, Ministry of Transport and Infrastructure Interview: Mbuvi Ngunze, CEO, Kenya Airways Air expansion: Bolstering facilities and security Still climbing: The building sector is at the centre of the country’s economic ambitions Regulatory reform: New regulations encourage foreign companies to partner with local firms Strong returns: Devolution affects real estate Interview: Mohamed Hassanali, CEO and Director, HassConsult Real Estate Land policies: Reforms increase equitable access Building on success: The path for new growth On the go: The thriving mobile money culture Interview: Fred Matiang’i, Cabinet Secretary, Ministry of Information Communications and Technology Interview: Bob Collymore, CEO, Safaricom Movers and shakers: Acquisitions and exits alter the telecoms landscape Taking it to the court: Legal challenges delay the switch to digital broadcasting Under the sea: Reliance on mobile broadband wanes as underwater cables are laid Broadband connectivity: Key deals boost access From sickles to services: Re-engineering of the industrial base presents growth opportunities On the up: National development policies kick in Interview: Adan Mohamed, Cabinet Secretary, Ministry of Industrialisation and Enterprise Development Interview: Manu Chandaria, Chairman, Comcraft Group Balancing act: Trade agreements need reform Shifting gears: Automotive assembly goes local Interview: Betty Maina, CEO, Kenya Association of Manufacturers Interview: Charles Ireland, Group Managing Director and CEO, East African Breweries Buying in: Rising consumption levels are driving growth and regional expansion Planning ahead: Perks of state-backed irrigation Interview: Moses Changwony, Managing Director, Sasini Tea & Coffee Interview: Jane Ngige, CEO, Kenya Flower Council Improving productivity: Horticultural exports rise Piping hot: Tea and coffee are key exports Seizing opportunities: Research initiatives and investments in cargo and processing Changing focus: With demand from traditional markets weak, authorities look to new niches A single visa solution: The East African Community eases traveller movement Interview: Phyllis Kandie, Cabinet Secretary, Ministry of East African Affairs, Commerce and Tourism Interview: Martin Dunford, Chairman, Tamarind Group Time and investment: Devolution and fresh funds should help improve access and indicators Interview: James Macharia, Cabinet Secretary, Ministry of Health Healthy start: Small firms join private providers Improving indicators: Tackling the issue of quality Interview: Mabel Imbuga, Vice-Chancellor, Jomo Kenyatta University of Agriculture and Technology Going online: E-learning university in the works Ongoing decentralisation: Coordination is key as a third of state powers move to the counties Interview: Anne Waiguru, Cabinet Secretary, Ministry of Devolution and Planning Cashing in: Downstream agricultural investments In the heartland: County plans to lift employment EY A raft of reforms: The nation’s tax law explained in detail Widening the base: Modernising tax laws and offering investment incentives Viewpoint: Gitahi Gachahi, CEO, EY Eastern Africa Anjarwalla & Khanna More clarity: New constitution, new legislation A changing landscape: Investor-friendly laws aim to foster further development Interview: Karim Anjarwalla, Managing Partner, Anjarwalla & Khanna Put your feet up: Information on hotels Listings: Some useful phone numbers Facts for visitors: Things to know before your trip The country’s LAPSSET project is developing a second transport corridor as well as a new hydrocarbons export channel for the region. Regulatory changes in 2013 have seen an uptick in PPPs, with 17 of 47 current projects dedicated to transport, alongside World Bank investment and state spending. Railway capacity is increasing to cover 50% of freight cargo, or 25m tonnes. The government’s serious investment in infrastructure has yielded significant benefits for the telecoms and IT sector. With mobile penetration reaching 80% in early 2014, Kenya is the leader in mobile money and commerce on the continent. Under the Connected Kenya master plan, the sector is set to undergo a transformation as ICT is seen as key to increasing foreign investment.
Following years of sustained growth, the outlook for the construction sector is positive as the industry benefits from a host of planned infrastructure projects and growing housing demand. In real estate, the past 14 years have seen property prices increase three-fold, and economic development blueprints are set to deliver benefits for the sector nationwide.
Plans are under way to introduce affordable state loans to subsidise fertiliser and establish a national irrigation scheme to cover 1m acres of land.
Moreover, tea and coffee both remain vital export commodities, despite the continuing vulnerability of smallholder farmers to global price volatility.
