Country overview:

IOA’s in-depth knowledge of Kenya has been acquired over the years through extensive research and the provision of consulting services on the country. Kenya is one of the most stable and best performing economies, not only within the East African region but the continent at large. Besides a sizeable export market for its coffees, teas and other horticultural products, including flowers, it has also enjoyed a reputation as one of the region’s leading finance and tech hubs, playing a leading role in the development and incubation of mobile money, mobile lending and other fintech innovations.

Recent years have continued to see the country make steady gains despite some economic challenges. Kenya’s achievement of “middle income country” status in 2014 brought improved investor confidence but also inhibited access to concessional loans and financing. By late 2024, high government debt and the successive shocks of the COVID and Ukraine crises had pushed the state fiscus to the brink, which was now faced with the conundrum of trying to finalise long awaited infrastructure projects such as the East African Single Gauge Railway without access to developmental financing from China or the option of raising local taxes due to popular pushback. Despite these challenges the country’s successes in other areas, including its recent achievement of “Non-NATO US Ally” status highlight Kenya’s continued suitability as a first port of call for investment into the region.

Key opportunities in Kenya:

Nairobi remains East Africa’s financial hub, drawing investor activity to the country
Ordinary Kenyans have benefited from the country’s advanced ICT sector by gaining access to financial and other services using ICT devices
Kenya’s creative economy including digital content, film, and music, is emerging as a new growth frontier, supported by youth entrepreneurship and mobile platforms

Key concerns/risks in Kenya:

Governance undermined by corruption and violence from Islamic extremist groups remain concerns
Recurring droughts and locust plagues due to global warming require a strong climate change policy
Debt servicing pressures and limited fiscal space may delay infrastructure projects and social spending

Tips on doing business in Kenya:

Starting a business:

Foreigners are allowed to open and own companies in Kenya. The country’s business registration system has been digitised and foreigners interested in registering local branches of their companies can do so via the citizen portal, after which they can acquire the necessary tax clearances
Foreigners can purchase land in Kenya, though only through leasehold tenure
The government has introduced a new eCitizen Business Portal to streamline registration, licensing, and tax compliance processes

Doing business:

Kenya is generally considered the key commercial and logistics hub of the East African region. The government has designated a variety of SEZs, called Export Processing Zones, where investors can tap into unique incentives, including corporate tax holidays and reductions on new buildings and machinery. Notable challenges include government corruption, inefficiencies, and a weak regulatory regime and judiciary
(Read more at: https://www.invest.go.ke/)
The services sector now contributes over 55% of GDP, with wholesale, retail, and financial services leading growth

Culture and society:

Kenya is one of the easier African markets to operate in thanks to widespread English fluency and a young, digitally savvy population
Harambee, or the cultural emphasis on mutual assistance, group identity, family, and community, is a key local cultural tenet. Deference is normally granted to seniority of age and education level over simple work experience. Foreigners should note that using the left hand is considered offensive
Urban youth culture is increasingly shaping consumer trends and digital engagement, making Nairobi a testbed for regional tech rollouts