Kenya has maintained a growth over the past years, which has opened the doors for a number of business opportunities. As political stability improves, Kenya has seen then rise of a growing entrepreneurial middle class – which has reduced the country’s unemployment rate. Recently, the current government has successfully attracted foreign direct investment, mainly going towards infrastructure development.
Kenya business overview
Population: 46.7 million
National currency: Kenyan Shilling (KSh)
Economic freedom score: 55.1 (ranked 130th worldwide)
GDP (PPP): $163.1 billion
Growth (2018): +4.8%
Inflation: 8.0 %
(source: https://www.heritage.org/index/country/kenya )
Kenya is ranked in 22nd position among 47 countries in the Sub-Saharan Africa region, with an economic freedom score of 55.1. Kenya is the 101st largest export economy in the world, with its preferred export destination being the United States ($531 million).
Kenya’s top 5 commodity exports
- Tea – $1.38 billion
- Cut Flowers – $688 million
- Refined petroleum – $294 million
- Coffee – $265 million
- Legumes – $134 million
Kenya’s top 5 commodity imports
- Refined petroleum – $2.34 billion
- Palm oil – $542 million
- Cars – $498 million
- Packaged medicaments – $431 million
- Raw sugar – $409 million
Top 5 business opportunities in Kenya
Here are the 5 best business opportunities in Nigeria. These business opportunities are considered as ‘safe’ investments, since the demand far exceeds the current supply volume. Most of these businesses have a more-than-decent room for improvement and will generally provide generous ROI.
As mentioned previously, the Kenyan government has been gradually implementing industrial policies to encourage development in the manufacturing sector. Kenya aims to increase its share of products in the regional market from 7% to 15%. Over the past years, various reforms have been set forward to promote the development of medium to large scale manufacturing firms. Manufacturing of engineering products, garments and fertilizers are among the most promising investment opportunities the country has to offer.
Agriculture in Kenya represents a massive 26% of the country’s GDP annually. The agri-sector makes up for almost 65% of Kenya’s total exports, and employs up 70% of informal manpower, mostly in rural areas. Getting into this sector may be highly profitable on the long run, especially if you are tackling most challenges faced by the agri-sector, such as transportation of food, food-processing and packaging, irrigation and production automation.
The ICT market in Kenya is currently estimated at around $500 million only! This leaves a huge room for development, and start-ups are rapidly emerging all over the country. With the introduction of a ‘National ICT Masterplan’, the country aims to become a major player in the Business Process Outsourcing space by 2030. Moreover, around 70% of Kenyans have access to financial services, which represents the highest share in all the Sub-Saharan Africa region. More and more investors recognize the need to fill the increasing demand for technology in Kenya.
Being the 3rd largest contributor to the GDP, Tourism is a key foreign exchange earner for Kenya. Continued government commitment has enabled the country to diversify its tourism generating markets. Investors can make the most of this sector by developing relatively untapped niches, such as cultural tourism, ecotourism and cruise tourism.
5. Infrastructure development
The increase in population has been pressuring Kenya’s current infrastructures and the government actively welcomes investors in the construction and development sector. Recently, different high priority projects have been set forward by the Kenyan authorities:
- development of a commuter railway system around Nairobi
- construction of a standard gauge line to replace the current Kenya-Uganda railway
- design and construction of a new terminal at Jomo Kenyatta International Airport
- development of a new corridor from Lamu to South Sudan and Ethiopia
3 reasons to invest in Kenya
- Kenya has 536 kilometers of coastline. Currently most of this coastline is underdeveloped and unused.
- Since its independence, Kenya has maintained remarkable stability, despite changes in political system.
- Kenya takes a liberalized economy approach to promote free trade and private investment, including import & export licensing and exchange controls.
Starting a business in Kenya – the smart way
Being East Africa’s largest economy, Kenya has attracted considerable attention from investors over the past decadce. While the local government is committed to implementing business reforms to facilitate trade, it is however, not always easy to get up and running.
Africa HR Solutions offers a range of reliable business services that can help your organization get started the easy way:
- Hire people in Kenya without a registered entity (Kenya Employer of Record)
- Complete payroll rundown and management (Kenya payroll)
- Central point of contact for all your queries
- Guaranteed compliance to local laws
- Professional indemnity and employer liability
As always, Africa HR Solutions guarantees 100% compliance for your business operations in Africa.