Governance

Kenya Vision 2030 says infrastructure “holds the key to economic growth” (PwC, 2023). However, the Kenyan construction industry grew by only 6.6% in 2021, a decline from 10.1% in 2020 and an indication of a slowdown in the short term. The sector is expected to maintain a growth rate of 6% in the near term. In 2022, USTDA estimated that this growth would be driven by large infrastructure projects in roads, ports, and airports in the coming years. The Government of Kenya will realize more infrastructure projects as PPPs.  (USTDA, 2022).

Kenya is one of the lowest cost developers of geothermal power in the world and over 80% of its electricity is renewable (ITA, 2022). The sector has experienced steady growth over the last two decades and electricity access has doubled from 32% in 2013 to 75% of households in 2022 (ITA, 2022). Around a third of Kenya’s installed capacity is owned and operated by IPPs across several plants, including small-scale hydro plants, geothermal, biomass, wind, solar, and heavy fuel oil plants. The remaining capacity is owned and operated by Kenya Electricity Generating Company (KenGen), which is 70% government-owned (ITA, 2022).

Agriculture is Kenya’s dominant industry, employing 80% of the national workforce (mainly in rural areas) and contributing to 30% of GDP (ITA, 2022) (KenInvest, 2020) (PwC, 2023). The sector accounts for 65% of Kenya’s exports and almost 20% of formal employment (AmCham Kenya, 2023). The country’s major agricultural exports are tea, coffee, cut flowers, and vegetables (ITA, 2022). Periods of high economic growth rates have been synonymous with increased agricultural growth (PwC, 2023).

The textile industry is labor intensive and has the opportunity to employ 10% of the Kenyan population (Trademark, 2023). Kenya is the largest exporter of apparel under the African Growth and Opportunity Act (AGOA) with about Ksh 47billion (325 million USD) worth of exports in 2019 and Ksh 39 billion in 2020 (270 million USD) (Trademark, 2023). While Kenya has made some headway in the global apparel market, it is lagging behind many competitor countries (World Bank, 2015).

Health spending accounts for 7% of GDP in Kenya (KenInvest, 2020). Kenya is a promising market for medical devices and has been ranked as one of the fastest growing markets in the sub-Saharan Africa region according to Fitch and World Bank reports (USTDA, 2022). Nearly 70% of Kenya’s healthcare services are provided by the public sector, through the Ministry of Health (MOH), and other government-funded bodies (USTDA, 2022).

Known as one of Africa’s “Silicon Savannahs” and the tech hub of East Africa, Kenya has a bustling ICT sector. The sector is growing at 10.8% annually and is a significant source of economic development and job creation in the economy (World Bank, 2019). Kenya is a leader in general ICT infrastructure, value added services (VAS), mobile money, and mobile banking and FinTech services (ITA, 2022). 70% of Kenyans use the internet, and the country has one of the highest penetration rates in Africa (KenInvest, 2020). The Digital Economy Blueprint offers a policy framework for building an enabling environment for the digital economy.