KMRC green bond attracts 312pc oversubscription, exceeds target to hit Sh9.4bn

Kenya Mortgage Refinance Company (KMRC)’s inaugural green bond defied absence of a tax-free sweetener to attract bids worth Sh9.4 billion against the targeted Sh3 billion, representing a performance of 312.8 percent.

The mortgage refinancing company will use the billions to provide cheap loans for green buildings, which are designed to use natural sustainable materials, be energy efficient and reduce water use in efforts to minimise environmental impact.

The eight-year paper priced at 12.2 percent was on offer between April 28 and May 12, 2026 and is earmarked for listing on the Nairobi Securities Exchange (NSE) on May 25.

The performance underscores high appetite for environmentally conscious debt raise issuance, with Safaricom’s November 2025 note having attracted bids worth Sh41.4 billion against a Sh15.0 billion target, registering 276.0 percent performance.

This makes the second tranche of KMRC’s Sh10.5 billion bond programme, coming four years after its debut issuance in February 2022, during which it raised Sh1.4 billion through its inaugural corporate bond that attracted 480 percent oversubscription.

The mortgage refinancer’s green bond has a 5.1-year average weighted life, implying that note holders will have the principal amount of the issuance paid down gradually as opposed to a bullet payment at maturity.

Proceeds from the sustainability security are expected to provide a boost to KMRC’s loan book, which closed 2025 at Sh19.6 billion, having grown from Sh11.9 billion in 2024.

‘One hundred percent of the net proceeds will be allocated to refinancing eligible green home loans and eligible social home loans as defined in KMRC’s Sustainable Finance Framework dated March 2026,’ KMRC said in a note to investors.

‘Bond proceeds will be used alongside other concessionary funding at KMRC’s disposal.’

The company had planned to return to the capital markets in 2024 but was prohibited by a high-interest-rate environment that would translate into a higher cost of funds and undermine its agenda of pushing affordable mortgages downstream in the market.

East African Breweries Plc, in November 2025, also took advantage of the low-interest-rate environment and raised Sh16.76 billion in a five-year non-Sustainability Linked corporate bond issuance with the coupon set at 11.8 percent.

In the year ended December 2025, KMRC net earnings stood at Sh1.0 billion, having contracted marginally compared to Sh1.3 billion in 2024.

The mortgage refinancer’s performance was impacted by a decline in net interest income from Sh2.2 billion to Sh1.7 billion, while its expenses grew to Sh370.9 million from Sh341.2 million in 2024.

The lead arranger and placing agent of KMRC’s Sh3 billion note is NCBA Investment Bank, with Cygnum Capital and C and R Group serving as financial advisor and Registrar, respectively. KCB Kenya Ltd is the designated receiving bank, while Ropat Trust and Mboya Wangong’u and Waiyaki are the Note Trustee and Legal Counsel, respectively.

Africa’s tourism future is bright, but it has an integration problem

Africa does not need another conversation about its tourism potential. The case has already been made repeatedly and convincingly. What Africa needs is a more serious conversation about why, despite the language of growth, connectivity and African Continental Free Trade Area (AfCFTA), tourism remains unnecessarily difficult to move, build and scale.

For too long, the diagnosis has been that the central problem is visibility: better branding, stronger destination marketing, more persuasive storytelling.

All of that matters. But the issue is not branding alone; it is whether the product, infrastructure and policy environment can consistently deliver on the promise. Africa is not short of attractions, culture, heritage, creativity or hospitality.

The deeper challenge is that the continent still makes it difficult to experience tourism as one market. Africa’s tourism economy is trying to grow on top of fragmented systems, a serious constraint at a time when global demand is shifting in its favour.

The 2025 World Travel Market (WTM) Global Travel Report projects travel and tourism growth of 3.5 percent annually between 2025 and 2035, outpacing projected global GDP growth of 2.5 percent.

It also finds that 56 percent of travellers are more interested in visiting new destinations than they were two years ago. In 2024, the continent recorded 74 million international arrivals and strong growth in air traffic, outperforming global averages. Africa is not lacking momentum, but its systems are lagging its opportunity.

The constraint, then, is not demand. It is whether Africa has built the systems to convert that interest into seamless regional tourism.

Travellers and investors still face visa friction, costly, indirect routes, fragmented regulation and limited cross-border products. We market Africa as connected, but operate it as disconnected. That model is becoming costly.

Global travel choices are increasingly being shaped by expense and overcrowding. This should work in Africa’s favour. The continent can offer distinctive, culturally rich and less saturated experiences at a time when travellers are actively looking beyond the traditional tourism hotspots.

But that advantage cannot be fully realised if destinations remain hard to reach, hard to combine and hard to transact across. If AfCFTA is to matter for tourism, then tourism must be treated as more than marketing.

Start with movement. Too many immigration systems still behave more like gatekeepers than facilitators of tourism and services trade. That logic is increasingly out of place in a continent that seeks deeper services integration, stronger regional circuits and more intra-African commerce.

Then there is aviation. If visas are one side of the integration challenge, air connectivity is the other. Africa cannot credibly speak of a single tourism market while intra-African travel remains among the most expensive, inconvenient and indirect in the world. This is precisely why the Single African Air Transport Market (SAATM) matters.

Conceived as an African Union flagship under Agenda 2063, SAATM is intended to liberalise African skies and create a unified air transport market. It is, therefore, far more than an aviation reform; it is a tourism competitiveness reform, which will lead to easier, cheaper and more direct air access.

The digital market presents another challenge. Nearly 80 percent of travellers used digital platforms when planning and booking their last international trip, while around 90 percent say social media and virtual assistants influence their itineraries.

This should force a deeper conversation in Africa, not only about visibility, but about control. Who owns distribution? Who owns the customer relationship? Who captures the data? And how long can African tourism businesses rely disproportionately on external platforms to sell African experiences back to the world?

Integration must also work for smaller players. A tourism economy cannot become transformative if only large firms can navigate its complexity. SMEs cannot scale across borders when licensing is unpredictable, standards are uneven, payment systems are clumsy, and market intelligence is weak.

Communities cannot benefit meaningfully if they sit near tourism, but outside its value chains. Skills transfer, technology transfer and local enterprise participation matter just as much as investment headlines. Basic CSR is not structural inclusion.

There is also a confidence dimension beneath the policy challenge. Africa still too often underestimates Africans as travellers.

The premium travel imagination remains outward-looking, as though the most desirable experiences lie elsewhere. Yet the continent’s advantages are clear: heritage, landscapes, culture, creativity and differentiated destinations.

Building a single tourism market means taking intra-African demand seriously, making it easier, more affordable and more attractive for Africans to travel, spend and experience Africa.

After attending WTM Africa 2026, the question for me is whether Africa is ready to build the machinery that turns its tourism advantages into a seamless, competitive and inclusive market.

The continent’s tourism future will be won not by visibility alone, but by integration of policy, infrastructure, standards, investment and experience. AfCFTA has opened the door. Africa must now build the systems to walk through it.

Gideon Kipyakwai: From working with mice to being Metropol CEO

Gideon Kipyakwai once worked with mice. He made them glow. This is not a metaphor. At the University of Hawaii, he spent years in a laboratory learning how to introduce something foreign into a living system and watch it take hold. The protocol, he will tell you, was painstaking. You had to understand what the system wanted to become. Then you had to get out of the way. He has been doing the same thing ever since. Just not with mice. With people.

He has spent his career testing that theory. First in banking, then in county government. Today, Kipyakwai is the Group CEO of Metropol Corporation, one of Kenya’s most influential credit bureau, with six subsidiaries, operations in two countries, and a mandate that decides who gets to participate in the formal economy. It is a position that requires, above all else, the ability to read what something is actually worth beneath the surface. Which is, it turns out, exactly what a molecular bioengineer does.

The career between the laboratory and the 15th floor, where Metropol sits in Nairobi’s Upper Hill, is improbable enough to require a diagram. Seminary student. Civil engineering dropout. Biomedical Sciences First Class Honours. CPA. KCB corporate banker. University of Hawaii Master of Science degree. Talk show host on Kass FM, discussing economic empowerment from across the Pacific. ICT company CEO. Chairman of a county public service board at 31, the youngest man in a room full of retired MPs. Then, finally, Metropol.

Gideon Kipyakwai once worked with mice. He made them glow. This is not a metaphor. At the University of Hawaii, he spent years in a laboratory learning how to introduce something foreign into a living system and watch it take hold. The protocol, he will tell you, was painstaking. You had to understand what the system wanted to become. Then you had to get out of the way. He has been doing the same thing ever since. Just not with mice. With people.

He has spent his career testing that theory. First in banking, then in county government. Today, Kipyakwai is the Group CEO of Metropol Corporation, one of Kenya’s most influential credit bureau, with six subsidiaries, operations in two countries, and a mandate that decides who gets to participate in the formal economy. It is a position that requires, above all else, the ability to read what something is actually worth beneath the surface. Which is, it turns out, exactly what a molecular bioengineer does.

The career between the laboratory and the 15th floor, where Metropol sits in Nairobi’s Upper Hill, is improbable enough to require a diagram. Seminary student. Civil engineering dropout. Biomedical Sciences First Class Honours. CPA. KCB corporate banker. University of Hawaii Master of Science degree. Talk show host on Kass FM, discussing economic empowerment from across the Pacific. ICT company CEO. Chairman of a county public service board at 31, the youngest man in a room full of retired MPs. Then, finally, Metropol.

Gideon Kipyakwai once worked with mice. He made them glow. This is not a metaphor. At the University of Hawaii, he spent years in a laboratory learning how to introduce something foreign into a living system and watch it take hold. The protocol, he will tell you, was painstaking. You had to understand what the system wanted to become. Then you had to get out of the way. He has been doing the same thing ever since. Just not with mice. With people.

He has spent his career testing that theory. First in banking, then in county government. Today, Kipyakwai is the Group CEO of Metropol Corporation, one of Kenya’s most influential credit bureau, with six subsidiaries, operations in two countries, and a mandate that decides who gets to participate in the formal economy. It is a position that requires, above all else, the ability to read what something is actually worth beneath the surface. Which is, it turns out, exactly what a molecular bioengineer does.

The career between the laboratory and the 15th floor, where Metropol sits in Nairobi’s Upper Hill, is improbable enough to require a diagram. Seminary student. Civil engineering dropout. Biomedical Sciences First Class Honours. CPA. KCB corporate banker. University of Hawaii Master of Science degree. Talk show host on Kass FM, discussing economic empowerment from across the Pacific. ICT company CEO. Chairman of a county public service board at 31, the youngest man in a room full of retired MPs. Then, finally, Metropol.

Do I sacrifice personal development? Do I sacrifice work? Work is what supports the family. I don’t think about it as work-life balance. Work is part of life. Family is part of life. Personal space, hobbies, community – all of it is life. As a CEO, most of my work is not even in the office. I can wake up at 3am thinking about problems or ideas. It’s not an 8-to-5 job. I work all the time. So for me, it’s not work versus life. It’s how to balance all the dimensions of life.

What’s your fear now?

Poverty.

But you’ve never experienced poverty before…

I still fear it. In my circle, I sometimes feel like I’m the poor one. [Laughs] A lot of times, poverty is relative to your circles. Can you afford what everyone around you can afford? If your child asks for something or wants to go on a trip and you have to say, ‘No, maybe next year,’ does that count as poverty? That inability to access certain things? When I think about why I wake up before 5am every morning, it’s because I don’t want to be poor. I don’t want to reach a point where I can no longer afford my current lifestyle, even as I keep aspiring for the next level.

What do you wish your children knew about you that they don’t know?

My children think I’m a joker. They don’t think I’m professional at all because they never really see my serious side. At home, we play a lot. I never carry work home. I don’t even take this laptop home. That’s why I try to come to work early. To finish whatever I need to finish here.

When I study, I go to my home office, but they know that’s mostly for my PhD, not work. They also know I like reading. I buy about a book a month, and I try to get them to read as much as possible. So they know that side of me. But they don’t really know the serious, numbers-driven side that people at work see.

What’s the most important question in your mid-40s now?

My biggest concern today is post-retirement income. Can I maintain the same lifestyle I live today? Can I generate the same cash flow from passive investments? Can I create enough income to sustain my current lifestyle after retirement?

Are you happy?

I’m purposely pursuing happiness. I consciously try to block out bad news and negativity. I don’t even watch the news much anymore. Maybe that’s burying my head in the sand, but I deliberately pursue positivity and happiness.

Failure for me would first be family. If I didn’t have my wife and children, that would be a major failure. If I couldn’t provide basic needs for them, that would also feel like failure. Then there’s health. If I don’t take care of my health and end up creating problems for myself, I would consider that a failure too.

What’s your vice as someone who’s deeply involved in church and faith?

Drinking? [Chuckles]

You like your bottle?

Yeah, I like my gin. It’s actually one of the areas where I have conflict with my children because they really want me to stop drinking. And sometimes it’s not even just the drinking, it’s staying out late. Maybe one or two nights a week, I’ll get home after they’ve slept.

My children really like seeing me before bed, so when I’m not there, they notice immediately. Because most days I’m home helping them with homework and spending time with them. So the next morning they’ll come and ask, ‘Daddy, what happened? Why didn’t you come home early?’ So, yeah, I need to work on that.

Fuel shocker as pump prices hit Sh242 per litre

Pump prices have hit a historic high with a litre of diesel jumping by Sh46.29 to retail at Sh242.92 effective Thursday midnight as consumers take a hit from the US-Israel war on Iran.

A litre of petrol will jump to Sh214.25, reflecting a rise of Sh16.63 while that of kerosene remains unchanged at Sh152.78. Prices of diesel and petrol would have been higher had the State not applied the subsidy. The prices will be in place for a month to June 14.

The steep prices come despite a Sh15.67 subsidies per litre of diesel and Sh98.60 per litre of kerosene. Petrol prices have not been subsidised as the State opts to reduce the burden on an Exchequer already grappling with subsidy arrears estimated at Sh17 billion.

The surge in pump prices reflects the impact of the US-Israel war on Iran, which triggered a global rally in fuel prices in March and last month amid thinning supplies and the blockade of the Strait of Hormuz.

Prices of Brent crude hit a four-year high of $126.41 (Sh16,325.85) a barrel in April amid the escalation in the Middle East conflict. Brent crude is the global benchmark for prices.

The historic high pump prices are set to trigger fresh inflationary pressure and further drive the cost of services and goods. Inflation hit a high of 5.7 percent last month in the wake of costly fuel.

Diesel is the major fuel running the Kenyan economy and farmers, power producers, public service transporters and manufacturers of goods will factor in the increased fuel prices, in the final prices of their goods and services.

Kenya currently imports fuel under the Government-to-Government (G-to-G) and the suppliers had already warned of escalating prices of the fuel supplied.

Constrained supply in the global market coupled with a logistical nightmare following Iran’s blockade of the Strait of Hormuz triggered a surge in prices of fuel in the global market.

Aramco Trading Fujairah (ATF), which is one of the three suppliers to Kenya in the G-to-G had warned said that six cargoes of diesel will be priced at higher rates in the wake of supply disruptions from the Iran war.

‘Sourcing from these alternative locations will extend delivery timelines and when combined with the current elevated price environment will directly and materially affect the prices at which we source our cargoes,’ ATF said in a letter to the government of Kenya in a letter dated April 1, 2026.

‘We are of the view that the events constitute a ‘MAC Event’ as defined under the Master Framework Agreement. We would like to formally request that the prices of the following upcoming shipments be amended as follows.’

Abu Dhabi National Oil Company (Adnoc) and Emirates National Oil Company (Enoc) are the other Gulf oil majors supplying fuel to Kenya on a credit period of 180 days. The deal started in March 2023 and is expected to lapse in the first quarter of 2028.

ATF has been forced to source diesel, petrol and kerosene meant for Kenya from other sources including India in a bid to avoid the disruptions caused by the Iran war. The fuel was mainly sourced from ports in the Gulf region before the war broke out.

Iran blockaded the Strait of Hormuz in February, which coupled with attacks on major refineries in the Gulf region, have significantly disrupted fuel supplies to the rest of the world.

Nearly a quarter of the fuel meant for the global market passes through the Strait of Hormuz, highlighting why its closure has hit the fuel supply chains.

The skyrocketing global prices of fuel have forced most countries to temporarily waive taxes in a bid to cushion consumers from costly fuel.

Kenya was forced to halve the Value Added Tax (VAT) on fuel to eight percent last month as part of efforts to contain the prices.

But the latest prices are likely to spark public outcry over the heavy taxation of fuel even as other countries ease levies on the commodity.

Kenya charges seven levies and two taxes on fuel, making it one of the countries with the highest taxation on fuel in the world.

These are VAT, Roads Maintenance Levy of Sh25 per litre of diesel and petrol, excise duty, anti-adulteration levy of Sh18 per litre of kerosene, import declaration fee and railway development levy.

Others are the Petroleum Development Levy of Sh5.40 for every litre of petrol and diesel and Sh0.40 on kerosene, merchant shipping fee and petroleum regulatory levy.

South Africa suspended fuel levy for one month while Namibia halved taxes on the commodity for three months. Zambia suspended excise duty and zero-rated VAT on petrol and diesel for three months. The changes took effect on April 1.

The taxman building digital bridge into informal economy

It is said there is nothing new under the sun. Not even the electronic tax invoice management system (eTIMS), which has been a thorn in the backside of many Kenyans.

To George Omondi Obell, commissioner for the Micro and Small Taxpayers Department at the Kenya Revenue Authority, eTIMS – an internet-based invoicing system – is an idea he brought back from his tour of duty around the world. Before eTIMS was launched in Kenya, Mr Obell had watched in awe how the technology transformed tax compliance in developed countries.

He had to bring the technology home. For Mr Obell, eTIMS is just one ammunition in an arsenal of technology the commissioner has been deploying to net millions of hard-to-tax Kenyans, including those in the informal sector, who have largely escaped the taxman’s reach. Others are pre-populated tax returns, simplified mobile filing platforms, WhatsApp taxpayer support systems, as well as ‘UshuruGPT’, an internally developed artificial intelligence (AI) compliance assistant.

An old hand at the KRA, Mr Obell believes the road to expanding the tax base beyond the easy-to-tax categories such as individuals on payrolls and businesses with a physical presence is using technology to simplify the entire tax process.

He says that before he rose to his current position where he is tasked with bringing into the tax bracket, ‘even basic tax obligations remained unnecessarily difficult for small businesses.”

Like many tax collectors, Mr Obell comes from the school of thought that, often, people do not deliberately avoid paying taxes – which many consider a civic duty – but rather lack a conducive environment that enables compliance. While the philosophical import of that viewpoint is debatable, there is little doubt that taxation as a concept is often too complicated for an ordinary mama mboga.

He reckons that registration, filing and payment systems required taxpayers to navigate complex online portals often inaccessible to ordinary traders operating far from formal business centres. ‘The process of registration, the process of filing, the process of payment, they are all very complicated.’

When President William Ruto took office in September 2022, he made little secret of his intention to reshape Kenya’s tax administration, arguing that the country’s revenue collection system had become aggressive and counterproductive to expanding the tax base.

The President at the time signaled plans to reform tax administration and overhaul leadership at the Kenya Revenue Authority (KRA).

‘A huge obstacle to the realisation of our national revenue target is that in practice, tax administration has traditionally been a repressive, menacing affair which resembles extortion,’ Dr Ruto said.

Two months later, in November, Mr Obell was appointed Commissioner for the Micro and Small Taxpayers Department (MST), a unit created earlier in March 2025 to enhance focus on the country’s vast informal and small-business tax base.

But it is Mr Obell’s role that has been pronounced. Recently, the internet went bonkers with reports that the KRA had visited the bustling Eastleigh area, a critical commercial district that is unfortunately associated with tax delinquency.

‘Many businesses across the country source goods from Eastleigh but face challenges in obtaining eTIMS invoices, which are critical for expense claims,’ Mr Obell wrote in a statement issued after holding a consultative meeting with the Eastleigh Business District Association.

‘We are going to ensure that traders are supported to register on eTIMS and issue receipts for all transactions, enhancing transparency and creating a level playing field.’

Obell has emerged as a key figure driving KRA’s transition from a paper-heavy bureaucracy into a data-driven institution built around real-time transaction monitoring and digital compliance systems.

He arrived at the tax body carrying lessons from global tax systems, inheriting the politically delicate assignment of bringing informal traders into the tax system without triggering widespread resistance from businesses already wary of KRA.

What confronted him was a familiar African problem – millions of businesses trading daily outside the reach of systems designed for salaried workers and formal companies.

His diagnosis was blunt. Kenya’s tax systems had remained heavily inward-looking even as commerce rapidly migrated towards smartphones, mobile money platforms and digital marketplaces that rarely fit traditional definitions of permanent business establishments.

‘Tax follows what is happening in the market,’ he says, capturing a philosophy that increasingly shapes KRA’s transition from a paper-heavy bureaucracy into a data-driven institution centered on real-time transactions and digital reporting.

Long before assuming his current office, Mr Obell had built a career around international taxation, cross-border commerce and transfer pricing, fields that exposed him to how multinational corporations structured transactions through complex technology ecosystems spanning multiple jurisdictions.

A lawyer, accountant and financial analyst by training, he spent years working with multinational firms whose operations depended almost entirely on automated systems, digital billing and transaction environments that traditional audit methods could barely penetrate.

‘You cannot for a moment begin asking for papers,’ he notes, describing how multinational tax enforcement increasingly requires administrators to understand software architecture and transaction flows.

Mr Obell’s rise within KRA coincides with mounting pressure on government to expand revenue collection without imposing politically explosive tax increases on already strained households and businesses facing slower economic growth and rising costs.

His international profile later expanded through appointments with the United Nations, where he served for five years as a tax expert tapped by the secretary-general to help shape discussions on global tax policy and developing-country revenue systems.

Mr Obell also worked with the Organisation for Economic Co-operation and Development on tax matters affecting developing economies, before chairing the African Tax Administration Forum’s working group on cross-border taxation.

These assignments, he notes, exposed him to electronic invoicing frameworks and real-time transaction monitoring systems already entrenched in parts of Latin America and Europe years before Kenya began implementing comparable digital tax infrastructure.

At KRA, Mr Obell concluded early that the Authority’s systems disproportionately served businesses already visible to government while leaving behind traders operating through informal channels.

The Authority’s response has involved shifting tax administration closer to environments where commercial activity already existed, including mobile phones, USSD platforms, payment systems and simplified applications designed for traders operating without sophisticated technology infrastructure.

KRA says more than 1.3 million taxpayers are now interacting with the simplified digital platforms, significantly exceeding the number using the traditional iTax portal that had long functioned as the Authority’s primary compliance gateway.

Much of the transformation revolves around the Electronic Tax Invoice Management System (eTIMS), which KRA increasingly frames as the backbone of future tax administration and transaction verification across the economy.

Obell says approximately 680,000 businesses have onboarded onto eTIMS, with nearly two-thirds joining through the simplified mobile-based systems.

Yet the transition has repeatedly collided with public suspicion and broader distrust surrounding KRA’s historical reputation as an aggressive enforcement agency rather than a service-oriented public institution.

Medical practitioners have, for instance, raised concerns about confidentiality and patient privacy after proposals requiring healthcare facilities to issue electronic invoices generated fears that sensitive treatment information could become accessible within government systems.

‘Resistance is normal. We have responded by introducing phased implementation schedules alongside alternative compliance tools, including buyer-initiated invoicing systems allowing purchasers to generate invoices on behalf of suppliers lacking smartphones or reliable internet access,’ Mr Obell says.

The Authority has simultaneously expanded direct taxpayer communication through WhatsApp notifications, automated reminders and pre-populated returns intended to reduce filing errors while nudging taxpayers towards voluntary compliance before enforcement measures become necessary.

One of the more ambitious projects under development is ‘UshuruGPT’, an internally built artificial intelligence chatbot designed to guide taxpayers through filing procedures and legal compliance requirements using conversational interfaces.

‘The broader objective extends beyond convenience into construction of a single point of truth, tracking invoices, payments, goods and stock movements nationally,’ says the commissioner.

Africa’s seat at the table: Why Kenya’s push to rewrite global tax rules matters for business

For a long time, the rules on how multinationals are taxed were written without Africa in the room. That is starting to change – and Kenya is right in the middle of it.

Take a familiar example. A multinational tech company earns significant revenue from Kenyan users. It has no office here. It pays no corporate tax here. The profits sit in a low-tax jurisdiction elsewhere, structured in a way that is fully compliant with the current rules. Those rules, however, were never really designed with markets like Kenya in mind. That is the system we have lived with.

The international tax framework – built on bilateral treaties, the Organisation for Economic Co-operation and Development guidance and transfer pricing rules – was largely shaped decades ago. It reflects the priorities of the countries that designed it. In practice, that has meant more taxing rights for where companies are headquartered, and less for where they make their money.

For countries like Kenya, the result has been fairly consistent: limited withholding tax rights under old treaties and constrained ability to tax cross-border payments. In today’s economy, where value can be created in a market without any physical presence, those limitations are becoming harder to defend. That is why the recent developments matter.

In November 2025, global tax negotiations were held in Nairobi – the first time they have taken place in Africa. Kenya did not just host. It played a leading role within the African Group in pushing for a United Nations Framework Convention on International Tax Cooperation.

One of the more consequential positions Kenya has taken is that a new UN framework should take precedence over older bilateral treaties where the two conflict. Many of Kenya’s treaties were signed when the country had far less leverage. Some of them now restrict how much tax Kenya can impose on dividends, interest, royalties and service fees.

Leaving those treaties untouched would effectively lock in those limitations and overriding them is not without consequence. It raises real questions around treaty hierarchy and how conflicts between old agreements and a new multilateral framework would be resolved. For businesses, that kind of transition is rarely neat.

Kenya has also taken a clear position on dispute resolution, preferring mutual agreement procedures over mandatory arbitration. The concern is a practical one. Arbitration tends to favour parties with deeper resources and stronger legal firepower.

So what does this mean for businesses? In the near term, not much changes overnight. But the direction is fairly clear. The real test is execution. If Kenya can push for change globally while improving confidence in its own tax system, it will not just have a seat at the table. It will have a meaningful say in how the rules are written.

Treaty positions that companies have relied on – particularly reduced withholding tax rates – may not hold in the same way going forward. Structures built around those provisions will need a closer look.

The digital economy is also firmly in scope. There is increasing pressure, led in part by countries like Kenya and Nigeria, to recognise market presence as a basis for taxation. For businesses operating across borders without a physical footprint, that is a material shift.

Transfer pricing is unlikely to remain untouched either. The arm’s length principle has always been difficult to apply in markets where comparable data is limited, and even more so where value sits in intangibles that are not easy to price.

That debate is not new, but it is picking up momentum.

There is, however, a separate issue that Kenya will have to confront alongside all this.

A country pushing for fairer global tax rules also needs to maintain credibility at home.

Businesses operating locally are familiar with the friction – assessments issued without much engagement, positions that shift across audits, and objection processes that can take longer than they should. These are not theoretical concerns. They affect real decisions on investment and growth.

Kenya’s position internationally is stronger when its domestic system is seen as predictable and fair. The two go hand in hand.

None of this takes away from what Kenya is trying to do. Pushing for a fairer allocation of taxing rights – particularly in a digital economy – is both necessary and overdue.

TetraPak East Africa MD on how much inflation has impacted its packaging business, opportunities for growth amid challenges

Rising costs of living have redefined consumer behaviour across multiple markets in Kenya and East Africa, and manufacturing businesses are beginning to feel the heat. Tetra Pak, a leading packaging business, has seen this first-hand as its clients struggle to sustain demand while consumer purchasing power drops drastically in the face of inflation.

Tetra Pak East Africa managing director Jonathan Kinisu spoke to the Business Daily on how much inflation has impacted its packaging business and the opportunities for growth amid challenges.

How is inflation currently affecting consumption of packaged food and beverage products in Kenya?

Consumers are becoming significantly more price-sensitive. If you go to the supermarket today, a packet of juice that was previously cheaper is now substantially more expensive. The first reaction for many households is to adjust consumption.

If you used to buy two packets, you probably move to one. In some cases, consumers shift to cheaper alternatives, and in more extreme cases, they stop buying the product altogether. That is already happening in the market.

That creates pressure on manufacturers to keep products affordable while still maintaining convenience and quality. At the same time, urbanisation means packaged food and dairy products remain important because consumers no longer produce many of these things themselves.

Has that meant les business for Tetra Pak?

Fortunately no. At Tetra Pak, over 70 percent of our business comes from milk processors. As you know, milk in Kenya is not excisable and not VAT-able. Consumption of milk also tends to be rather inelastic because you know, we have a tea drinking culture as a country.

So we continue to support our customers through equipment and packaging to be able to keep their products in the market. But the question is, at what cost?

Over time, consumers will begin to look for cheaper alternatives and that’s a challenge our manufacturers will have to deal with. So, we will also have to start thinking about how to make our products available to customers at more affordable rates.

Beyond inflation, what other pressures are affecting this market?

There are multiple pressures. Taxes and changes in the cost structure of products have an impact, as does the broader cost of living. When prices rise over time, consumers adjust their behaviour gradually but consistently. We are seeing this reflected in supermarket purchasing patterns, where households are increasingly rationalising what they buy.

Let me take you back briefly. The company often references the old ‘Maziwa ya Nyayo’ school feeding programme. Does that history still matter in today’s context?

That programme was extremely impactful, not just for us as a company but for the country. If you look at what the school feeding programme achieved in the 1970s and 1980s, the effects are still visible today.

First, it improved school attendance and educational performance. I firmly believe many of the captains of industry we see today were beneficiaries of that programme.

Second, look at what it did for dairy consumption. Kenya today has among the highest per capita dairy consumption levels on the continent. We are at roughly 120 litres per person per year, and that culture was accelerated by the school feeding programme, alongside the tea-drinking culture left by the British.

Third, it strengthened the dairy industry itself. It supported the cooperative movement and created stable demand for milk.

Those children who consumed milk then are now adult consumers of dairy products. For us, participation in a programme of that scale remains one of the most impactful things in the company’s history.

Is Tetra Pak currently involved in any efforts linked to school feeding programmes?

We have definitely expressed interest in supporting school feeding initiatives again. Globally, school feeding programmes are something we participate in extensively. In 2025 alone, around the world, roughly 68 million children received portions of school feeding in Tetra Pak packaging.

Locally, however, the context is different because the programme is now decentralised. We no longer have one national school feeding platform. Different counties are running their own independent programmes.

We have seen programmes in places like Makueni, Kiambu and Uasin Gishu. We have also had discussions with other counties and stakeholders.

But the efforts are fragmented. It would be far more effective if there was a coordinated national framework.

The company has also recently backed use of recyclable carton in affordable housing, how viable is that?

Yes, you can build low-cost housing structures using ecoboards developed from recycled beverage cartons. The products are waterproof, termite-resistant and fire-resistant.

In more advanced markets such as South Africa, recycled cartons are already being used to produce roofing sheets similar to mabati. The polymer and aluminium components can also be separated and turned into plastic products such as crates and chairs.

The materials are already available commercially. If somebody wanted to build a small house using ecoboards, it is possible. The challenge at the moment is scale. We need more waste collection so that enough ecoboards can be produced consistently.

Tetra Pak’s recycling rate in Kenya is still relatively low, around 10 percent. Why is that?

Recycling is a journey. No market recycles 100 percent of post-consumer waste.

The biggest issue is the economics of waste. Waste pickers need incentives. If collecting plastic earns more money than collecting carton waste, naturally they will prioritise plastic.

There are also costs involved in transportation, aggregation and cleaning. Recyclers do not want dirty waste.

Sh17bn fuel subsidy spat triggers shortages at fuel stations

Fuel stations are grappling with stock-outs due to inability in evacuating product from the system of Kenya Pipeline Company (KPC) amid mounting cash-flow woes exacerbated by delays in subsidy payments estimated at Sh17 billion.

Major dealers mainly Vivo Energy and Rubis Energy Kenya and dozens of small marketers across the country, have since early last month been grappling with stock-outs, triggering panic buying from consumers wary of missing out on fuel.

Oil marketers are required to pay all taxes upfront before they can access fuel in the KPC system. However, the cash-flow hitches have made this difficult given that fuel has also become costly, further hitting marketers.

Fuel prices significantly jumped last month, with landed costs rising by up to 105 percent translating to costly product which the cash-strained oil marketers are struggling to pay for, in order to restock their stations.

Industry insiders and government officials owned up to the nightmare of the delayed subsidy payment, saying that this has triggered a cash-flow nightmare that has made it increasingly difficult to purchase the expensive fuel.

For example, the State owes oil marketers Sh6.042 billion for the monthly cycle that ended on April 14, There is also verified but unpaid bill of Sh1.7 billion and a further Sh9 billion awaiting verification.

‘A bigger problem which we must own up to as a government is the subsidy. As you are aware, the payment has delayed and this has a big impact on the cash-flows of oil firms and as a result most of these marketers do not have money to pay for the product,’ a top State official in the energy sector told this publication.

Vivo Energy tops the subsidy arrears for the monthly cycled that ended April 14 with an unpaid bill Sh1.47 billion, followed by TotalEnergies Marketing Kenya at Sh737.57 million and Sh534.75 million for Rubis Energy Kenya.

‘…we cannot say that there is hoarding but rather what we have is a cash-flow problem, remember the steep subsidy applied in the current cycle,’ said an industry executive.

‘The subsidy has not yet been paid, the industry does not have money to pay for the costly fuel in the KPC system. The marketers are bleeding, for you to access fuel, you must pay taxes upfront, it is tough,’ added the executive.

Oil marketers are required to pay taxes upfront before lifting product from the system of KPC.

This has turned out to be an uphill task given that the industry is smarting from a hole of more than Sh6 billion in the current monthly cycle, that lapses on Thursday midnight.

The stock-outs had earlier fueled fears of fuel hoarding. Fuel hoarding mainly happens when oil marketers anticipate a significant rise in pump prices and thus withhold fuel days to the gazettement of the new prices.

Oil marketers have since found it increasingly difficult to pay for the product and taxes in order to lift it from the system of KPC, triggering stock-outs that have also hit oil the three oil majors, Vivo Energy, Rubis Energy Kenya and TotalEnergies Marketing Kenya.

Prices of diesel, kerosene and petrol significantly rose in March, meaning that oil marketers need more money to access their nominated quotas.

For example, landed costs (price of product and transport costs) of kerosene surged 105.15 percent to $1,311.93 (Sh170,655.85) per cubic metres in March from $639.48 (Sh82,774.2) for the same quantity in February.

Landed costs of diesel jumped to $1,073.82 (Sh139,68.50) per cubic metres in March from $636.45 (Sh82,382.08) for same quantity in February while those for petrol rose to $823.87 (Sh107,169) per cubic metres from $582.11 (Sh75,348.31) for same quantity in the same period.

Industry sources warn that the woes could worsen in the coming days if the State does not pay the arrears soon and further extends the subsidy in the new prices that will take effect from Thursday midnight.

The cash-flow woes look set to deepen after the government opted to extend the subsidy in the new prices and which will be in place for a month to May 14.

The State was forced last month to deploy a subsidy of Sh108.10 per litre of kerosene and Sh23.92 billion per litre of diesel. The steep subsidy helped prevent prices from hitting Sh260.88 and Sh230.76 for kerosene and diesel respectively. Under subsidy, oil dealers retain the pump price announced by the Energy and Petroleum Regulatory Authority.

The government then pays them the additional cost, with the money drawn from the Petroleum Development Levy (PDL). PDL is charged at the rate of Sh5.40 per litre of petrol and diesel. The rate was hiked from a previous Sh0.40 per litre from July 2021 as the State sought to build bigger buffers for the subsidy scheme.

SK Macharia locked in minority position in Directline Assurance

Media mogul SK Macharia has suffered a legal setback after the High Court upheld an arbitration decision confirming him as a minority shareholder at Directline Assurance Company.

Mr Macharia had been embroiled in a protracted dispute over the company’s shareholding, with rivals accusing him of unlawfully taking control while the matter was pending in court.

The dispute was later referred to arbitration, and in January 2022, the arbitrator ruled that Macharia’s rivals were the majority shareholders, holding 90.336 percent of the company’s shares, while the Royal Media Services owner held 9.66 percent.

The arbitrator also found that Mr Macharia and his group had unlawfully occupied the company’s offices at Hazina Towers and denied access to other shareholders.

While Mr Macharia sought to quash the award, his rivals petitioned the court to recognise and enforce it.

‘Given the said circumstances, this Court is satisfied that the Arbitral Tribunal was properly constituted, and its assumption of jurisdiction cannot be impeached at this stage outside the statutory framework,’ the court said.

The court added that Mr Macharia was attempting to re-litigate issues already decided by the arbitration tribunal.

‘This court cannot therefore entertain claims of factual or legal error by the Arbitrator or interfere with such findings,’ said the court.

Mr Macharia signalled his intention of appealing the decision.

Directline Assurance, established in 1998, initially had its shareholding split among AKM Investments Ltd (48 percent), Janus Ltd (32percent), and Royal Media Services Ltd (20 percent).

Mr Macharia argued that the company’s Articles of Association included a pre-emption clause requiring existing shareholders to be given priority before any transfer of shares to outsiders.

He claimed that from 2007, his late son John Gichia Macharia and Janice Theresa Wanjiku Kiarie excluded him from management and falsely asserted that their shares were held in trust for him.

A 2005 shareholder register showed Royal Credit Ltd with 997 shares (0.01 percent), Mr Macharia, Purity Macharia, and Dan Karobia with one share each, AKM Investments Ltd holding 4,978,108 shares (40.6 percent), Janus Ltd 2,318,738 (20 percent), Royal Media Services Ltd 1,448,212 (11.83 percent), and Triple A Capital Ltd 3,500,000 (28.58 percent).

A more recent register dated February 12, 2023, indicated AKM Investments had a 10.36 percent ownership, SK Macharia at 0.0000000067 percent, Royal Media Services at 9.7 percent, and other holdings distributed among Stenny Investments, Triad Networks, Sureinvest Ltd, Janus Ltd, and others.

Mr Macharia also challenged the arbitrator’s impartiality, arguing he was biased, redefined parties and issues improperly, and denied him a fair hearing. He said he participated under protest.

The court, however, observed that he submitted written evidence and participated in procedural directions issued to all parties.

Other shareholders defended the arbitration process, saying it complied with Section 19 of the Arbitration Act.

They also accused Mr Macharia of resisting the handover of company premises, issuing threats, and mismanaging the company, exposing it to execution proceedings totalling about Sh1 billion.

The court found the allegations of bias unsubstantiated and upheld the arbitration award.

‘In the premise, this Court is satisfied that the impugned Partial Arbitral Award is valid and enforceable pursuant to the provisions of Section 36 of the Arbitration Act and to the extent of the Correcting Memorandum dated 8th June 2022,’ the court said, allowing the majority shareholders to enforce the decision.

Safaricom in deal to secure fuel for its base stations

Safaricom Plc is working with select oil marketing companies to ensure supply of fuel to keep its sites operational in the wake of elevated risks in availability of petroleum products. This comes amid supply chain disruptions following the war on Iran.

A site, otherwise known as a base station, refers to the physical structure that creates a signal and provides coverage which then enables consumers to make calls, send messages and connect to the internet.

The listed telco says that as an entity categorised as a critical service provider per the Kenya Information and Communications Act, it is important that there is certainty around its service provision even in the wake of significant shocks such as the one currently being experienced following the war on Iran.

‘We are a telecoms operator and we do consume a lot of fuel running sites and the availability of sites is of paramount importance for us and that is what we are dealing with now. We are working with some of the oil marketing companies to see that we are able to get the quantity that we need, especially because we are a critical service provider,’ Safaricom chief financial officer Dilip Pal told the Business Daily.

Safaricom Kenya closed the full year ended March 2026 with a total of 24,479 base stations of which 7,540 were 2G, 7,536 were 3G, 7,524 were 4G and 1,879 were 5G.

‘It’s not necessarily for long but we are working with some oil marketers to ensure that we have availability of fuel for some time,’ Dilip says.

The telco’s arrangement with select oil marketing companies in the country comes in the wake of intermittent stock outs of petroleum products across parts of the country, following the war in the Middle East.

‘The Ministry of Energy and Petroleum wishes to inform the public that the temporary fuel supply challenges experienced in isolated filling stations in some parts of the country arose from a technical and administrative hitch. This curtailed optimal uptake of petroleum products by a few oil marketing companies operating in the downstream of the supply chain,’ the Ministry of Energy and Petroleum said in a statement released on May 6.

The statement came one week after the government had announced a temporary waiver of standards on the Sulphur parameter of petroleum product to the maximum limit of 50.0 milligram per kilogramme for Diesel and Super for six months.

‘Owing to constraints occasioned by the ongoing conflict in the Middle East, including disruption to supply routes such as the Strait of Hormuz, and the need to safeguard continuous supply of fuel critical to the economy, the Ministry of Investments, Trade and Industry has approved a request to temporarily waive the Sulphur parameter to the maximum limit for a period of 6 months,’ the Ministry of Energy and Petroleum said in a statement released on April 30.

Safaricom, however, says that its Ethiopian subsidiary is adequately cushioned and therefore under no immediate pressure to work with oil marketing companies to ensure security of supply.

‘The dependency on fuel for Ethiopia is not material. It’s very tiny because it is a green grid and 98.0 percent of our sites are powered through electricity. So, the dependency on fuel in Ethiopia is not much,’ Dilip says.

Safaricom Ethiopia closed the year ended March 2026 with 3,504 base stations having grown 18.3 percent from the number of base stations a year earlier.