Kenya is the biggest economy in East Africa. It has a population of 45.5 million people, most of whom practice Christianity. In terms of investing in Kenya, the conditions are right for investors to make money in the East African nation.
It is one of the fastest growing economies in the region. There has been solid growth in infrastructure, manufacturing, and service industries. This has made it a leading destination for investors.
Below are eight things that one needs to know before investing in the country.
The current president, Uhuru Kenyatta is the son of the nation’s first president, Jomo Kenyatta. Kenya has a unitary state with multi-party democracy. It has had a devolved system of government since March 27, 2013, when a new constitution was inaugurated.
Kenya’s growth rate is about 5.8 percent. There are sound economic policies that have put the nation as a fast growing economy. Its fiscal policy has helped finance projects in energy and transport sectors without straining the domestic financial markets. The economy is diversified and depends on both manufacturing and services industries. Since 2015, Kenyan Shilling has struggled against the Dollar. Economy has been negatively affected by this volatile forex market environment, stunting growth for those investing in Kenya.
The nation depends on tourism and agriculture as the key pillars of its economy. Tourism contributes to about $ 1 billion annually. Since 2012, the earnings have dropped earnings due to terror attacks. Kenya is the leading exporter of black tea in the world. About 80 percent of the country is classified as arid or semi arid and. The nation has adopted irrigation based farming to increase its agricultural production.
Kenya discovered oil in 2012 and is in the process of turning it commercial. Once this comes online by 2018, the country could earn a lot more from this commodity, and those investing in Kenya will benefit.
The country faces a high threat from terrorism Somalia’s Al Shabab militant group. Since 2000, at least 900 people have been killed in terror attacks. Attacks on Kenyans have increased significantly since 2011, when its military moved into Somalia in to help stabilize the war-torn nation.
In 2013, there was an attack in Westgate Shopping Mall in the capital, Nairobi. Two years later, terrorists killed more than 148 students in an attack on Garissa University College in Northern Kenya. Most attacks are targeted at shopping malls, transport systems, learning institutions, places of worship, coastal areas and other places that are most frequented by foreigners.
This is one of the biggest challenges to the country’s economic and political growth, and something that hinders people from investing in Kenya. In 2015, it was ranked as one of the most corrupt nations in the world, at 139 out of 169 nations. The anti-corruption institution, Ethics and Anti-Corruption Commission has failed to successfully to lead the national fight against corruption. There has been no successful prosecution of cases despite numerous corruption scandals rocking successive governments since the start of multi-party democracy in the 1990s. Embezzlement of public funds, procurement fraud are rampant in both the public and private sector.
High cost of living and growing levels of unemployment are two major problems facing the nation’s social sphere. Kenya has adopted Vision 2030 to lead in efforts to improve the lives of its citizens in social, political and economic aspects
There are more than 40 organized criminal gangs in the country. They engage in drug trafficking and money extortion syndicates. Others are politically affiliated and are mostly active during the elections periods. The government has made efforts in curbing organized crime. In 2010, legislation on the Prevention of Organized Crimes Act was passed into law, making the idea of investing in Kenya more likely.
The nation has a well-developed road transport that connects its cities with the rural parts. The overall network is estimated at over 250,000 kilometers. It is a major means of transport. It is also developing a standard gauge railway to ease passenger and cargo transport from Mombasa, East Africa’s largest sea port to Nairobi. This is part of the railway network set to connect the nation to Uganda, Rwanda and South Sudan. It started in October 2013 and is set to be complete by December 2017, at a cost of $3.8 billion. Jomo Kenyatta International Airport is the busiest airport in East and Central Africa. It serves more than 5.8 million passengers annually.