Cabinet Minister Hon. Lee KinyanjuiKenya’s government plays a significant role in facilitating investments, supporting cross-border trade, and strengthening EAC integration. Corporate Africa speaks with Hon. Lee Kinyanjui, Kenya’s Cabinet Secretary for Investments, Trade, and Industry, about the role the country plays in supporting trade in the EAC.
Kenya has positioned itself as an economic hub in East Africa, leveraging government policies, infrastructure development, and regional integration to attract investments and expand trade within the East African Community (EAC) and beyond. The government has implemented various measures to facilitate foreign and domestic investments, support private sector expansion into EAC markets, and enhance infrastructure to boost trade connectivity. Additionally, Kenya is actively working with EAC members to deepen regional integration, strengthen the African Continental Free Trade Area (AfCFTA), and mitigate external trade barriers such as US tariffs on African goods. So Kenya’s strategies promote investment facilitation, private sector support, infrastructure development, EAC integration, and investor engagement.
Kenya has introduced several policies and institutions to create a conducive environment for investors. Key initiatives include:
Kenya established investment promotion agencies, specifically theKenya Investment Authority (KenInvest). The agency serves as a one-stop shop for investors, providing information, licensing support, and incentives such as tax breaks and export processing zones (EPZs).
Kenya has established Special Economic Zones (SEZs).
Kenya has established SEZs in Mombasa, Kisumu, and Naivasha, offering investors tax holidays, reduced corporate tax rates (10 percent for the first 10 years), and customs exemptions.
Business Reforms and Ease of Doing Business
The Ease of Doing Business Initiative has streamlined business registration, land acquisition, and tax compliance through digital platforms like eCitizen. The Companies Act (2015) and Insolvency Act (2015) have improved corporate governance and investor protection.
Public-Private Partnerships (PPPs)
The Public Private Partnerships Act (2021) encourages private sector participation in infrastructure projects, including roads, railways, and energy. Major PPP projects include the Nairobi Expressway, Lamu Port-South Sudan-Ethiopia Transport (LAPSSET) Corridor, and Standard Gauge Railway (SGR). The SGR project, partly funded by China, has improved cargo movement from Mombasa to Nairobi and beyond, reducing transport costs and attracting logistics investors. It has also cut cargo transit time from Mombasa to Nairobi from 2 days to 8 hours, boosting Kenya-Uganda trade.
Financial and Tax Incentives
Tax breaks for manufacturing under the Big Four Agenda (affordable housing, manufacturing, healthcare, and food security). Double Taxation Avoidance Agreements (DTAAs) with over 20 countries to encourage foreign investments.
Policies supporting the private sector expansion into EAC markets
Kenya is the largest economy in the EAC, contributing over 40 percent of the bloc’s GDP. To enhance cross-border trade, the government has implemented
(i) EAC Common Market Protocol (2010)
It allows free movement of goods, services, labor, and capital across EAC states (Kenya, Uganda, Tanzania, Rwanda, Burundi, South Sudan, and DRC). Kenyan companies including Safaricom (M-Pesa), Equity Bank, and Bidco Africa have expanded into Uganda, Tanzania, and Rwanda. Safaricom has also entered Ethiopia, which, despite not being a member of the EAC, is the biggest country in East Africa, with a population exceeding 120 million.
(ii) Elimination of Non-Tariff Barriers (NTBs)
Kenya continues to work with the EAC Secretariat to reduce NTBs such as roadblocks, customs delays, and arbitrary fees. The EAC Single Customs Territory allows goods to clear customs once (e.g., at Mombasa Port) for seamless transit to Uganda, Rwanda, and DRC.
(iii) Export Promotion Programs
SGR train Kenya
The Kenya Export Promotion and Branding Agency (KEPROBA) supports SMEs in accessing EAC markets through trade fairs and financing. African Growth and Opportunity Act (AGOA) benefits Kenyan exports such as textiles and handicrafts duty-free to the US, but diversification into EAC markets offsets AGOA uncertainties. Kenya’s Naivas Supermarket has expanded into Uganda, while KCB Bank operates in all EAC states, boosting regional financial integration.
Infrastructure Development to Enhance Trade and Cultural Connectivity
Kenya is investing heavily in transport and energy infrastructure to link with neighboring EAC countries: Transport infrastructure such as the Standard Gauge Railway (SGR) connects Mombasa and Nairobi, with plans to extend to Uganda, Rwanda, and the DRC. The LAPSSET Corridor is a US$24 billion project linking Lamu Port to South Sudan and Ethiopia. It works to enhance northern trade routes in terms of time and costs. Road networks include the Northern Corridor (Mombasa-Kampala-Kigali), which is a key trade route, with ongoing upgrades.
Digital Infrastructure
Digital infrastructure includes Konza Technopolis, which is a Silicon Valley-style hub to attract tech investors and improve digital trade. And M-Pesa Cross-Border Payments, which facilitates instant money transfers across the EAC, boosting trade with SMEs while reducing costs of transfers.
Energy Projects
Kenya is among Africa’s leading nations when it comes to renewable energy. And projects like Lake Turkana Wind Power (Africa’s largest wind farm) supply renewable energy to Kenya and the EAC regional grids. Kenya is also a global leader in geothermal power, ensuring stable electricity for industries.
Kenya and the EAC continue to work for deeper integration and a stronger AfCFTA to bolster regional and intercontinental trade. And to counter US tariffs (e.g., AGOA restrictions) and boost intra-African trade, Kenya and the EAC are
- Accelerating AfCFTA Implementation
Kenya was among the first to ratify AfCFTA (2020), enabling duty-free access to 1.3 billion Africans, and engage the National AfCFTA Implementation Strategy to identify key export sectors such as tea, coffee, textiles, and tech. Under AfCFTA, Kenya’s avocado exports to Egypt and Morocco have grown, reducing reliance on European markets while increasing home market capabilities.
- Strengthening EAC Monetary Union
The EAC plans to implement a single currency by 2031 to facilitate transactions among member states. Additionally, plans exist for an EAC Passport to allow visa-free travel and to boost labor mobility.
- Harmonizing Trade Policies
The EAC Common External Tariff (CET) protects local industries from cheap imports. This is supported by the EAC Digital Free Trade Area, which will work to enhance e-commerce.
Invest in Kenya and the EAC.
The Kenyan government invites investors to engage in its industries. Kenya is East Africa’s gateway, with a robust private sector, world-class infrastructure, and access to 300 million EAC consumers. We offer investment in Kenya’s SEZs, tech hubs, and manufacturing incentives; political stability; and a skilled workforce. The EAC and AfCFTA present limitless opportunities, and Kenya is a strong partner for growth in AfCFTA and Africa.
Conclusion
Kenya’s investment-friendly policies, private sector support, and infrastructure developments strengthen its role as a leader in the East African Community (EAC). By deepening regional integration and leveraging the African Continental Free Trade Area (AfCFTA), Kenya aims to offset external trade barriers and position Africa as a global trade powerhouse. By deepening regional integration and leveraging the African Continental Free Trade Area (AfCFTA), Kenya aims to offset external trade barriers and position Africa as a global trade powerhouse. For investors, Kenya and the EAC offer unparalleled growth potential in a rapidly integrating African market.