Category: Business Daily

Kenya’s private sector has long been celebrated as the heartbeat of the economy. It continues to power jobs and investment even in tough times.

Yet beneath the resilience lies a difficult truth: growth has not been equally shared. Many businesses, especially SMEs, remain exposed to shifting market conditions and unpredictable policies.

Kenya’s economy grew by 4.7 per cent in 2024, supported largely by strong performance in agriculture, fintech and mobile money. According to the African Development Bank’s 2025 Kenya Country Focus Report, inflation eased from 7.7 per cent in 2022 to 4.5 per cent in 2024, helped by better food supply, a 16 per cent strengthening of the shilling and lower global oil prices.

However, access to affordable credit remains a challenge. The 2024 KEPSA SME Policy Index Report indicates that private sector credit growth fell to four per cent by June 2024, from 13.9 per cent the previous year, as businesses struggled to borrow under tighter monetary policy.

To keep growth on track, Kenya needs policy stability and predictability. Businesses thrive where rules are clear and consistent. The next wave of progress will come not from more regulation, but from better, simpler enforcement of existing ones.

Kenya’s reputation as the ‘Silicon Savannah’ continues to shine. According to Ken Research (2024), the country’s mobile money and fintech ecosystem is now valued at more than $2 billion. Fintech innovations are helping firms become more efficient and resilient than before.

Still, digital finance has its pitfalls. The 2024 FinAccess Household Survey found that 16.6 per cent of borrowers defaulted on their loans, up from 10.7 per cent in 2021.

SMEs are Kenya’s real growth engine, though many remain stuck in informality. This limits their access to credit, government programmes and large contracts. Initiatives like the Credit Guarantee Scheme and digitised business registration are helping, but many entrepreneurs are still not aware of them.

Unlocking SME potential requires strong links with corporates through supplier development, mentorship and content policies that genuinely empower Kenyan firms.

Kenya’s next chapter depends on how well its businesses adapt to a fast-changing international economy. The shift towards renewable energy, sustainable manufacturing and ESG-aligned investment is no longer a side agenda.

The foundations for sustained growth of the private sector are already in motion. However, these strengths will only deliver their promise if matched with coordinated action. Policymakers must prioritise stability and smarter regulation, financial institutions need to widen access to affordable credit and corporates should deepen partnerships that help SMEs scale.

Kenyan exporters to America expect an extension of the Agoa arrangement to shield them from tariffs as much as 42 percent from 2026, preserving thousands of jobs for firms at export processing zones (EPZs).

There is a familiar exchange across Africa that carries far more meaning than it appears. When someone asks, ‘How are you?’ the answer is often simple, ‘I’m surviving.’

It is said casually, sometimes with a smile. But beneath it sits a layered truth. Surviving means things are not falling apart, yet they are not fully right either. It is an acknowledgment of pressure without inviting deeper interrogation. It is also a quiet agreement that the listener may not be ready for the whole truth.

Teddy Fidelis Lyimo gently picks up a glass, pours in a wine the colour of red rose, and takes a slow sip as a smile spreads across her face.

‘This one is a year old. With a gentle sourness, it tastes fresh and lively,’ she explains.

The government now claims that blocking duty-free rice imports would worsen Kenya’s looming food crisis, with national stocks projected to run out by the end of this month leaving over 3.5 million people at risk of hunger if emergency measures are halted by the courts.

Court documents filed by the Ministry of Agriculture and other state agencies reveal an urgent need for approximately 750,000 tonnes of rice between January and June 2026, while only 110,000 tonnes remain in reserves. Officials argue this shortfall cannot be addressed through local production alone.

Kenya Airways (KQ) has stopped operating flights to Eldoret, one of its three domestic routes, after nearly two years in the latest review of its network.

The national flag carrier is no longer accepting bookings to or from Eldoret, but has not officially announced a suspension or a complete exit from the route, which is among the country’s most lucrative.

The High Court has barred the National Treasury from releasing contract payments to a firm awarded a tender linked to the State-run Integrated Financial Management Information System (Ifmis) over an outstanding debt of Sh212.8 million owed to its business partner.

In enforcing an arbitration-backed decree arising from the technology tender, the court ruled that while government assets cannot be seized, the law allows debts owed by the State to third parties to be attached.

The Treasury expects interest rates to decline further this year despite a widening budget deficit that will see the projected net borrowing from the domestic market cross the Sh1 trillion mark for the first time in the upcoming 2026/2027 fiscal year.

The government’s increased borrowing appetite would ordinarily yield upward pressure in interest rates, but a liquid money market and Central Bank of Kenya (CBK) rate cuts saw returns from government securities fall last year.

Fines and penalties are now the second-biggest source of revenue for State agencies after collections jumped by Sh101.5 billion in the year ended June 2025.

Disclosures by the Treasury show that government entities collected Sh230 billion in fines, penalties, and forfeitures in the period under review, from Sh129 billion raised a year earlier, when the three were the third-biggest revenue source.

The accommodation and food service sector in Kenya recorded a growth of 17.7 percent in the quarter to September 2025, a surge largely driven by the TotalEnergies CAF African Nations Championship (CHAN) tournament that the country co-hosted with Uganda and Tanzania.

The three East African nations co-hosted the eighth edition of CHAN 2024, between August 2-30, 2025.