A national priority
As part of the Presidential “Big Four Action Plan”, Kenya welcomes investments in manufacturing. The objective of the Kenyan government is to increase the contribution of the manufacturing sector from 11% to 20% by 2022.
To attract investors, the government is rolling out a suite of non-fiscal and fiscal incentives thereby reducing start-up and operating costs.
Why Kenya for manufacturing goods?
Source : World Bank
The Kenyan manufacturing industry is the third manufacturing industry in Sub-Saharan Africa. Growth in the manufacturing sector continues to be particularly strong and robust: the value added increased by 3.5% in 2015 and 2016.
Massive local and foreign markets
In addition to a steady and growing local demand for manufactured goods, major international markets (U.S.A, European Union, etc) and regional markets are accessible under preferential conditions goods manufactured in Kenya.
Household final consumption per capita (in USD)
Source : Kenya National Bureau of Statistics
Kenya’s strong growth prospects are supported by an emerging middle class and an increasing appetite for high-value good and services.
There is a wide range of direct investment and joint-venture opportunities in the manufacturing sector, especially in the following sectors:
|AGRICULTURAL MACHINERY AND EQUIPMENT
There are opportunities to manufacture tractors locally, with more than 3,000 tractor units required for government projects over the next few years and a minimum of 1,760 tractors to be replaced annually by commercial farmers.
|PLASTIC AND PACKAGING
There is significant opportunity for consumer plastic bags, and various paper, aluminium, glass, plastic and rubber articles used for packaging. Demand for consumer plastic products has been growing at 15%–20% per year and the use of plastics in Africa is expected to triple in the next five years.
Kenya’s leather products sector has been growing at around 18% per year in the last decade. There is a wide domestic deficit with a demand of 38 million pairs of shoes per year where local producers can only meet a demand of 4 million.
Additional attractive sectors include:
|Iron and steel||Fertilizers||Garments||Chemicals|
|Machinery and machine tools||Assembly and manufacturing of spare parts||Automotive components and electronics||Metal and engineering|