Kenya - pillar of good investment practices in Africa
18 March, 2015
To further improve their citizens' well-being and quality of life, Governments aim for prolonged periods of economic growth. In most cases, assistance from private enterprises plays a key role in the economic development. From this relationship, the government aims to keep and increase its popularity among its constituents, while the business partners aim to increase their profitability. As a result, the public and private sectors often cooperate to improve the economic growth of the country.
With a plan called Vision 2030, Kenya is working hard to increase the quality of life of its people. The country has centred this policy around three "pillars", namely economic, social and political progress. Facilitation and infrastructure projects, along with macro factors are key instruments in this plan. The government has launched over 100 projects under the scheme, designed to bring prosperity to the east African nation. These new projects aim to draw FDIs and infrastructure development.
Kenya's Economic Pillars
The main sectors covered by the pillar with the most direct on Kenya's financial success the economic pillar include:
- Imports and exports;
- Financial services; and
Tourism is the main focus at present, as the tropical scenery, sandy beaches and equatorial climate show year-round potential. This region is suspected to be the birthplace of mankind, which can bring cultural tourists in the country. To support this, there are options for hospitality businesses and tour operators to invest in line with the government's plan.
The first success story of this plan is the Konza Technology City, which launched in January 2013. This industrial paradise is planned to provide 100,000 IT and outsourcing related jobs by 2030. As a result, entrepreneurs will be able to take advantage of Kenya's population with English skills and competitive labour costs. Another option is to develop modern back-office services that rely on remote working technologies.
The Kenyan government has invested in several Industrial parks for SME start-ups since 2008, with the first five located in Nairobi, Eldoret, Mombasa, Kisumu and Nakuru. These modern estates diversify the country's industrial sector by focusing on various activities, ranging from heavy industry in the Nairobi park to the processing of fruit juices and vegetable oils in Mombasa. These estates are further supported by Vision 2030's agricultural projects, particularly a large-scale irrigation scheme.
The financial sector is also being modernized, as Kenya's capital markets are being liberalized. To ease investment and capital raising, the Nairobi Stock Exchange has demutualized and the bond market has been brought into line with contemporary standards. Real estate investment trusts have now been introduced into law, providing enhanced regulation for collective investments in the Kenyan property market.
Thanks to Vision 2030, foreign entrepreneurs will receive both direct and indirect benefits to their investment in Kenya. For example, the direct advantages to moving your business to Kenya include
- Taking advantage of the new infrastructure;
- Operating an inexpensive offshore outsource center with native English-speakers;
- Importing goods to satisfy the increase in Kenyans' disposable income;
- Quick adoption of mobile money through M-Pesa, boosting innovation.
Vision 2030 : http://www.vision2030.go.ke/
Economic Pillar Flagship projects: http://www.vision2030.go.ke/index.php/projects/economic
Starting a business in Kenya: http://www.healyconsultants.com/kenya-company-registration/
Success tips for doing business in Kenya: http://www.healyconsultants.com/kenya-company-registration/other-information/
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