Category: Business Daily

When Felix Chege first dipped his toes into the world of public supplies as a university student, he did not have the benefit of full visibility of how bureaucracies and information gaps inhibit business.

All he could see were the challenges whenever he wanted to, say, source 100 printers of the same quality from Nairobi for supply to Masinde Muliro University, and ensure consistency of supply to meet the university’s demand.

‘Imagine being asked to deliver 100 printers when you have no idea where to even source them consistently. Nairobi had them, yes, but getting them from different suppliers and same quality was a challenge,’ Mr Chege recalls.

It was this sourcing headache that planted the seed and Mr Chege began to dream of a platform that could simplify procurement, sourcing, and logistics.

He started Real Sources Africa, a company that has carved a niche out of breaking the red tape involved in cross-border trade by digitising operations that have always relied on paper to facilitate cross-border movement of goods, while connecting traders with business facilitators.

Today, Real Sources Africa is the official trading company of the African Continental Free Trade Area (AfCFTA) in Kenya and eight other countries.

At a time when most African countries are looking inward to trade with counterparts as a way to grow business, Real Sources Africa finds itself as a crucial nexus between businesses and markets, and while at it cultivating influence and cash.

‘We are basically a trade facilitation company and our main role is to support exporters and importers to be able to expand their market base across the region without the hassle of the normal logistics, market entry and capacity building,’ Mr Chege says.

The company has facilitated trade valued about Sh5.8 billion ($45 million), involving 315 containers since launching its platform nine months ago, and business will only get bigger after the African Export-Import (Afrexim) Bank came on board as a partner.

Real Sources Africa is currently getting support from the AfCFTA to facilitate onboarding and trading among businesses in the continent, but also from the Afrexim Bank which has offered its platform, Africa Trade Gateway (ATG), for use by businesses trading under the AfCFTA.

Since the launch of ATG on September 23, 400 new companies have registered and Mr Chege says the company expects to onboard 3,600 businesses in the next six months.

With the entry of Afrexim, financiers and businesses in need of cash flows are expected to come on board due to the development bank’s capacity to bank roll trade transactions.

Companies pay Real Resources a commission for their profiles to be maintained on its platform, where they can meet buyers if they are selling products, or source for products not available within their locality, if they are seeking to import.

Real Sources finds itself as the trusted bridge for businesses across the continent, and benefitting from the ATG, a key trading platform that is capable of conducting due diligence on companies seeking to trade through the AfCFTA, thus boosting trust among trading parties.

There are only 10 AfCFTA trading companies across the continent, and Real Sources is the official face of the continental trade bloc across nine countries.

The companies are charged with representing AfCFTA in market development and demand creation as the trading bloc entrenches its operations, essentially by identifying where there is a need for certain products and supporting ways to supply them from within the continent.

They also support businesses attain compliance requirements, aggregation and logistics issues to build volumes for export across borders, and facilitate trade finance for businesses in need of financing to trade successfully.

‘AfCFTA trading companies came up to create a practical implementation of the AfCFTA ratification. They are lifting up the barriers of trade such as customs and standards issues, and tariffs to make trade very practical,’ says Mr Chege.

What started as a small campus hustle in 2015 has evolved into a regional enterprise that is now simplifying trade for exporters and importers, and while at it cultivating influence.

The company approached AfCFTA secretariat to pitch its idea on how digitising operations could address major trade barriers within the continent, and that was how it was picked to be the trading bloc’s official face to the business community.

Among products it showcased was a platform dubbed Biashara Link Portal which is capable of directing business inquiries by potential buyers to the right producers of goods being sought for exporters to initiate conversations.

This happens through the creation of a database of already active exporters of different goods, for them to receive inquiries directly and start negotiating with buyers.

‘Why should someone fly across the continent just to find out what’s available? Technology allows us to make trade borderless, at least in terms of information,’ says Mr Chege.

The company also signed a partnership agreement with Kenya’s Ministry of Foreign Affairs to automatically channel business inquiries coming through embassies to producers of the goods being sought.

Through an initiative dubbed TradeConnect, Real Sources is also engaging with stakeholders including counties to create demand for goods produced locally, by leveraging the County Aggregation and Industrial Parks (CAIPs) to produce and ship in volumes.

‘We removed our minimum turnover requirement. Initially, we required companies to have at least $100,000 turnover but we realised that that was locking out too many passionate entrepreneurs. Now, we’re fully in the SME space,’ says Mr Chege.

To onboard and trade on the platform, a company needs to provide its certificate of incorporation, business details, ownership structures, and undergo due diligence by Real Sources.

Mr Chege believes that while logistics in terms of physical infrastructure has hindered intra-Africa trade, information gaps, where many lack visibility on what product is needed, were leading to mismatched demand and supply have also been a huge barrier, a problem Real Sources seeks to address.

‘Our role is to map demand and supply, then guide businesses accordingly. If maize is needed in Rwanda, or steel in Egypt, we should know-and help businesses position themselves to seize that opportunity,’ he says.

And as AfCFTA gains momentum in an effort to charm Africa more towards trading with herself, the role of its trading companies such as Real Sources Africa will become more crucial, as they stand at the heart of the trading bloc’s operations, connecting governments, banks, and businesses.

I have a lot of colour and patterns in my rooms at home, how do I find carpets that will work with everything else I have going on? Is a Sh8,000 carpet as good as one that goes for Sh1 million? Do I go for patterned or full-blown shag?

These are the questions many Kenyans ask themselves as carpets flood the market, from luxury Persian rugs to affordable Chinese imports, all vying for buyers’ attention.

‘I refer to carpets as the clothing of a home,’ says Sahar Shahrabi of Persian Carpets, a shop in Nairobi’s Rosslyn Riviera mall that deals in both handwoven and machine-made Persian rugs. ‘It doesn’t matter what kind of furniture you put in, without a carpet, it still feels like the home is not warm or cozy.’

Ms Shahrabi’s business, which sources carpets from Iran (Persia), was originally started by her father about 14 years ago. She made her way into the fold at the seventh year mark before eventually taking over the reins.

‘It didn’t start as a shop or a big business, my father would just bring a few pieces and exhibit them at home. At the time, it was difficult because people didn’t know much about Persian carpets or understand why they were so invaluable, but the customer base has slowly grown over the years.’

Now they have a growing market, particularly among those who can afford luxury furniture and who, in addition to quality, care for the art and culture that comes with their home decor pieces.

‘Before, people didn’t see carpets as a necessity and were unwilling to spend a lot of money on them,’ she notes. ‘But now people have experienced other qualities of carpets and realise the difference. They appreciate Persian ones for their high quality and because they are long-lasting. They no longer ask many questions when they come to the shop now.’

Of the two types the shop offers, the machine-made ones sell more because they are more affordable and their maintenance is easier.

‘Using a soft brush and carpet shampoo, you can even wash them with water but for the hand-made, no. Those are very special. They are made from a sheep’s natural wool and with natural dyes from things like walnuts and pomegranates which are cooked before the wool is dipped in. That’s why when they come in contact with a lot of water, especially hot water, their colour fades.’

Naturally, this has prompted the shop to issue instructions for care and maintenance as they sell their carpets. Liaising with a cleaning company, they also offer regular cleaning and repair services for their customers.

Adding to all this, the fact that hand-made rugs often take up to years to be completed, makes their prices range higher than that of their machine-made counterparts.

‘There is no rule for the hand-made ones, each one comes with its own price, story, and certificate. You can find a small piece going for Sh1 million, and a larger piece going for Sh100,000. It all depends on which city it came from, the patterns, how many people worked on it, and how long it took to be completed.’

For the machine-made ones, it is all about the thread count. The store only stocks the highest count, 1,200 which means their carpets cost between Sh40, 000 to Sh180,000, depending on size.

The competition

But has their business begun to feel the pinch in market share, with the influx of carpets into the Kenyan market as buyers increasingly import from cheaper sources such as China?

‘Everything has its own market. The person who knows about the quality and uniqueness that an original Persian rug offers, of course knows which ones to buy.’

Ms Shahrabi cites the high shipping costs and heavy taxes as some of the major challenges of running a luxury carpet business in Kenya.

‘We pay so much just to clear the carpets when they come in and that keeps prices going up. This makes things difficult for us because the way Nairobi is, we cannot increase our selling prices too frequently or we’ll lose our customers. Yet, we still have to pay our employees’ salaries and the rent,’ she says. ‘Sometimes I wonder if the business is worth all the hassle.’

Kings Carpets, a subsidiary of Kings Enterprises, also deals with imported carpets, but from Turkey.

‘In terms of quality, Turkish carpets rank just below the Persian carpets,’ says Edwin Mathenge, the owner.

Initially selling ‘3D’ carpets, Mr Mathenge decided to shift gears when the China-made options flooded the market. ‘We noticed that most of the buyers who came to us belonged to a higher class and were looking for quality. To serve them, we decided to deal in quality carpets.’

Having been in the carpet industry since October 2021, Mr Mathenge believes that while its market is unsteady, up one day and down the next, it has seen massive growth over the years.

‘Carpets are a basic need now. Many sellers who want to shift and sell other things are ending up in the carpet business,’ he says. ‘The government even realised that there is money there and introduced new taxes.’

Dealing with these taxes has been one of his biggest challenges, along with cases of theft and customers who fail to pay on time.

One of the most common mistakes he has seen customers make is choosing a carpet that doesn’t match the theme of their home or furniture.

But he hopes artificial intelligence (AI) will help, especially those who do not want to hire interior designers.

‘People can take photos of their rooms and receive AI suggestions on what decor pieces to add,’ he says.

Cheaper carpets

Bernard Wainaina, is among those who source carpets from China and Turkey. His carpets range from between Sh9,000 and Sh11,000.

He says a good number of his customers choose their carpets based on their pockets rather than the quality of the floor-covering.

‘For example, I have a carpet called ‘Crown’ which is of very good quality, but it no longer sells because it’s expensive. Instead, people prefer types like ‘3D’ and ‘American,’ which are much cheaper and sell very fast. Most high-class customers are also not comfortable with the busy atmosphere in Kamukunji market, so we mostly sell to other buyers.’

As one who has been selling carpets in both wholesale and retail for around nine years now, Mr Wainaina says that the Kenyan carpet market is not what it used to be. It’s become much tougher.

‘You can’t compare it to four years ago when we used to religiously follow the product-supply chain. A product would move from the manufacturer, to the distributor, then to the retailer who would sell it to the customers,’ he says.

‘But nowadays, the Chinese manufacturers skip us as the distributors and sell directly to the retailers. This has cost me a lot of my customers.’

Another challenge has been the advent of e-commerce.

‘It’s good and bad at the same time. I sell quite a bit online myself, but the challenge comes when a reseller whose shop is purely online, sells the same carpet at a much lower cost. This happens a lot since without rent expenses or employee salaries to pay, they’re chasing a much lower profit margin in comparison, but the customer won’t understand all this.’

Struggling government-owned companies now account for more than a third of Kenya’s external loans as they increasingly rely on debt to sustain operations, a trend that is swelling public debt and repayment costs, and pushing the country closer to debt distress.

An analysis by the African Development Bank (AfDB) shows that of the Sh5.48 trillion owed to external lenders as of June, 38.5 percent – about Sh2.11 trillion – was borrowed to support underperforming State-owned enterprises (SOEs).

This makes SOEs key drivers of Kenya’s rising borrowing and debt service costs, deepening fiscal risks amid currency volatility and dwindling foreign exchange reserves.

‘Budget support to prop up underperforming and poorly governed State-owned enterprises (SOEs) consumes the largest share of total external borrowing, at about 38.5 percent,’ the AfDB said in a special report on Kenya’s debt.

The report was authored by AfDB country economist for Kenya Duncan Ouma and senior research economist Martin Nandelenga from the bank’s Macroeconomic Policy, Forecasting and Research Department.

According to the report, the transport sector is the second-largest consumer of external loans, accounting for 21.8 percent, or Sh1.19 trillion, of Kenya’s foreign borrowing. The energy sector follows at 9.4 percent (about Sh515 billion), while the remainder has been channelled to projects in water supply, health, agriculture, education, and other sectors.

‘These factors have elevated Kenya’s debt service costs,’ the AfDB warned. ‘According to the December 2024 debt sustainability assessment, Kenya’s overall and external public debts were assessed as sustainable but remain at high risk of debt distress.’

Kenya’s total public debt currently stands at Sh11.49 trillion, equivalent to 65.7 percent of GDP – well above the 55 percent threshold – heightening the risk of default.

Money owed by SOEs includes on-lent loans, guaranteed debt, and non-guaranteed debt contracted directly by public entities.

On-lent loans refer to funds borrowed by the government and subsequently extended to State agencies, while guaranteed debt comprises loans taken by SOEs but backed by government guarantees.

In the year to June 2024, these loans totalled Sh1.39 trillion, representing about 27 percent of total external debt. Although not all were borrowed externally, the government has yet to release updated figures for the year ended June 2025.

Based on the latest data from Treasury, on-lent loans surpassed the Sh1 trillion mark for the first time in the year to June 2024, reaching Sh1.2 trillion from Sh974 billion a year earlier.

Among the largest on-lent borrowers are Kenya Railways (Sh737.5 billion), Kenya Airways (Sh99.9 billion), Kenya Electricity Generating Company (KenGen) (Sh78.6 billion), and the Athi Water Works Development Agency (Sh55 billion).

In total, the government has borrowed on behalf of 54 State enterprises and agencies, while another 21 SOEs have taken non-guaranteed loans amounting to Sh78.2 billion. Although these are not backed by the State, they are still classified as part of public debt.

Additionally, the government has guaranteed loans worth Sh100.2 billion for Kenya Airways, KenGen, and the Kenya Ports Authority. Kenya Airways has already defaulted on its portion, forcing the Treasury to assume repayment.

The mounting debt burden of SOEs reflects the growing number of State corporations that are technically insolvent and dependent on budgetary bailouts to remain afloat, some of which have been loss-making for years.

Auditor-General Nancy Gathungu revealed that at least 22 State corporations and agencies were insolvent as of June 2024, requiring a combined Sh165.39 billion to stay operational.

Among the struggling entities are the Postal Corporation of Kenya (Posta), Kenya Electricity Transmission Company (Ketraco), Postbank, Consolidated Bank, Rivatex, and Sony Sugar, among others.

To reduce the heavy fiscal burden of loss-making SOEs, the International Monetary Fund (IMF) and the World Bank have urged Kenya to accelerate a large-scale privatisation programme, which is already underway.

More than 35 State-owned companies are slated for sale, including the Kenya Pipeline Company, which is expected to be listed on the Nairobi Securities Exchange by next year.

Internet service provider Liquid Telecommunications has once again been found to be in breach of data privacy laws for recording a Zoom meeting with a former employee, despite his express denial of consent.

In a landmark ruling, the Office of the Data Protection Commissioner (ODPC) faulted the company for retaining the recording even after one of the participants requested its deletion, raising concerns in an era when virtual meetings, often recorded, have become a corporate norm.

The ODPC ordered the telco to pay Andrew Alston, its former chief technology officer, Sh700,000 for violating his data privacy rights by unlawfully recording and retaining the Zoom call.

‘The call recording caused harm and prejudice to the complainant, in the context in which it was used. The call containing his personal data was processed by the respondent, Liquid Kenya, without his knowledge and consent,’ said Data Commissioner Immaculate Kassait in the ruling.

‘As a result of the processing, the complainant was placed in a position where he had to object to the processing and defend the admissibility of the call at his own cost.’

This marks the second time Liquid has been penalised by the data protection regulator. Last year, the company was fined Sh500,000 for using a man’s image for commercial purposes without his consent.

According to the latest case file, Mr Alston held a meeting with the head of human resources at Liquid Kenya and the overall HR head in London shortly after being laid off. ‘The call was heated, and a lot of things were said,’ he told the ODPC.

He added that although he had expressly requested that the call not be recorded and had been assured it would be deleted, he was shocked to discover it had been preserved and later used as evidence in a lawsuit he filed against Liquid Mauritius, the parent company of Liquid Kenya.

In its defence, Liquid argued that it had retained the recording out of ‘legitimate interests’, claiming that it was needed for potential evidence since Mr Alston had already threatened to initiate arbitration against the firm.

‘The recording of the call was specifically retained to document, for possible evidentiary purposes, certain proposals or threats that the complainant had made to or against Liquid Kenya during the call,’ the telco told the ODPC.

While acknowledging that the company may have had legitimate grounds to keep the recording, the ODPC ruled that Liquid failed to notify the data subject, thereby breaching the Data Protection Act.

The regulator further noted that the firm did not demonstrate how its ‘legitimate interests’ justified sharing the recording with Liquid Mauritius, a separate entity that was the subject of the lawsuit.

Ms Kassait also found that the telco’s claim of legitimate interest did not pass the necessity test, as there were ‘less intrusive’ ways to obtain the same evidence.

‘The purported legitimate interest fails the necessity test to the extent that there were other less intrusive means of achieving the same purpose, that is, evidence for purposes of litigation, such as written confirmation or minutes of the meeting,’ she said.

Milk intake in the formal sector hit an all-time high of 690 million litres in the eight months to August, due to an increased supply from farmers to dairy processors in response to attractive prices.

Data from the Kenya National Bureau of Statistics shows that milk delivered formally to dairy processors grew 17.2 percent in the period under review to 690 million litres from 588.9 million litres in a similar period last year.

‘Production is up, the prices paid by the formal market are attractive and stable, hence the high supply on our side,’ Kenya Dairy Board (KDB) acting Chief Executive William Maritim told the Business Daily.

‘New processors have also joined the industry, for example, the Ravine Dairies, increasing the capacity and the numbers we are seeing.’

The milk deliveries this year hit a record high every month since January, with May posting the highest amount of 94.6 million litres sold to the processors.

This was followed by 90.4 million litres in January and 90.2 million litres in June.

Farmers sold the lowest volume of milk of 77.9 million litres in February, which was, however, higher than the deliveries in every month of 2023 and most of 2024.

Most of the milk produced in Kenya does not reach the formal markets, according to a previous study, which found that the majority of households buy raw milk directly from farmers and traders.

Retailers are selling packaged milk at substantial differences in prices. A spot check shows that a half litre of milk at various supermarkets in Nairobi ranges from Sh50 to Sh60.

At Naivas Supermarkets, a 500ml packet of milk varied between Sh38 and Sh55, depending on the brand.

Fresh milk at Carrefour is sold at between Sh47 and Sh66, for a 500ml packet, depending on the brand and type of packaging.

With an estimated 1.8 million smallholder farmers who make up around 80 percent of the producers, it is estimated that about 80 percent of Kenya’s milk is marketed informally.

The formal sector refers to milk that is collected, processed or distributed via licensed, regulated channels, as opposed to the informal market of raw milk sold locally in Kenya.

KDB had earlier estimated production-including formally and informally marketed milk-to be about 5.2 billion litres annually.

In its 2024-2027 strategic plan, KDB aims to grow Kenya’s annual milk production to 11 billion litres and boost exports to one billion litres.

The Kenya dairy sector is the largest in East Africa, contributing approximately four percent to the national gross domestic product GDP and 14 percent of the agricultural GDP, according to the International Livestock Research Institute. It provides livelihoods for about 1.8 million households and creates over 700,000 jobs.

Only four percent of Kenyans have the income to afford a mortgage of Sh10 million amid the rise in home prices.

A new survey by pension firm Zamara, the Centre for Affordable Housing Finance in Africa (CAHF) and Financial Sector Deepening Kenya (FSD Kenya) shows that 6,146 of 145,205 pension scheme members can afford a house loan of more than Sh10 million, representing 4.23 percent of the respondents.

This is in line with Central Bank of Kenya (CBK) data, which shows that the average home loan has increased to Sh9 million from Sh6.9 million in 2013 and Sh7.5 million in 2014, a jump blamed on expensive homes and upfront fees.

Besides rising home prices, the survey observes that stagnant pay and costly mortgages have locked out a majority of Kenyans from bank-financed housing.

The CBK data shows the average size of a mortgage is Sh9 million with a repayment period of 11 years at an interest rate of 14.9 percent.

This type of loan will attract a monthly instalment of at least Sh140,000, and one would require a gross monthly salary in excess of Sh420,000, given that banks demand that borrowers retain a third of their pay after all deductions.

More than 85 percent of Kenyans earn less than Sh100,000 per month, official data shows.

‘High interest rates, strict eligibility criteria, and low income levels push most households to rely on short-term, high-interest personal loans or informal financing, which are not ideal for long-term housing projects,’ the report read in part.

Banks have pointed out the low level of income against the high cost of property purchase as a major impediment to the growth of Kenya’s mortgage market.

The banking sector had issued 30,016 mortgage loans against a formal employment of 3.4 million Kenyans.

Expensive homes, high interest rates and high incidental costs like stamp duty, legal and valuation fees remain the biggest obstacles to the growth of the mortgage sub-sector.

These difficulties have seen a lot of Kenyans opt to buy houses or take sacco loans to buy land and build incrementally.

According to the Zamara survey, 22.7 percent of respondents can afford a Sh3 million house with a favourable 25-year repayment period and at 9.5 percent.

‘Under the subsidised Kenya Mortgage Refinance Company (KMRC) rate of 9.5 percent, a household earning Sh100,000 per month can qualify for a mortgage of approximately Sh3.4 million, enough to purchase a typical Affordable Housing Programme unit.’

Zamara highlighted the profile of the pension scheme members, with about half or 47 percent, earning below Sh50,000, 42 percent taking home between Sh50,000 and Sh150,000 and 11 percent getting over Sh150,000.

The report has pointed out that the Affordable Housing Program’s attempt to ‘solve the price equation, fails the ‘livability test”.

This is because the affordable housing stock comprises primarily studio, one-bedroom, and two-bedroom units, designed to meet affordability targets rather than family requirements.

‘Our survey indicates that most members predominantly in their 30s and 40s aspire to own three- or four-bedroom homes suitable for families with children…This points to a fundamental disconnect between policy intent and market demand,’ the report added on family size mismatch.

Three-bedroom houses under the affordable housing project are sold at Sh3 million a unit.

About one in ten (12.2 percent or 17,725) respondents can afford a five million house comfortably without much financial strain.

‘[This] represents mid- to upper-income earners capable of servicing larger loans, though at higher financial commitment levels,’ the survey read in part.

Only four percent or 6,146 of the sampled Kenyans said they can afford a house loan of more than Sh10 million.

Most of the properties on the market are targeted at the middle class with a recent report noting that there is a shortage of low cost housing.

The Kenya Bankers Association has previously said that this shortage was because developers are inclined more towards renting than selling.

Global Motors Centre, the distributor appointed to sell Jetour brand of cars in the Kenyan market, is investing Sh1.4 billion to start assembling the Chinese models in Mombasa from the first quarter of 2026.

Local assembly will see the firm benefit from several tax incentives, enabling it to cut its introductory showroom prices that are substantially lower than the sticker prices of some rival Japanese and European brands in the same categories.

Global Motors has started selling four sports utility vehicle (SUV) Jetour models at prices ranging from Sh4.9 million to Sh7.8 million, inclusive of taxes.

‘We are going to start assembling the Jetour models in the first quarter of 2026 at our Mombasa plant. The investment in the Jetour line is about Sh1.4 billion,’ Ali Zubedi, Managing Director of GMC, told the Business Daily.

He said the Jetour line marks an expansion of the plant which has been assembling FAW trucks that are sold by Global Motors’ sister company TransAfrica Motors.

With local assembly, Mr Zubedi said the company plans to lower the Jetour prices due to tax incentives offered to local assemblers.

The government exempts assemblers from the import duty of 35 percent levied on fully built vehicles. Completely knocked down (CKD) parts headed to assembly plants are also exempt from 20 percent to 35 percent excise duty levied on imports of fully built vehicles, depending on the engine capacity and fuel type.

Assemblers also pay a lower import declaration fee of 2.5 percent compared to the standard 3.5 percent. The two percent Railway Development Levy (RDL) is also reduced to 1.5 percent for assemblers.

Local assembly can lower vehicle prices by up to millions of shillings, with dealers of commercial units such as pick-ups, trucks and buses making the biggest investment in local production.

Global Motors is among the passenger car dealers also moving to tap into tax incentives to gain a pricing advantage in a market where used imports dominate sales.

The company unveiled four Jetour models -the T2 priced at Sh7.8 million, T1 (Sh7.4 million), X70 Plus (Sh5 million) and Dashing (Sh4.9 million).

Jetour, part of Chinese automaker Chery Group, was founded in 2018 and has sold over one million SUVs worldwide. The brand’s entry in Kenya will intensify competition in its target segment where its major rivals include CFAO Mobility Kenya and Inchcape Kenya.

CFAO’s lineup of SUV models include Toyota RAV4, Landcruiser Prado, and Mercedes GLC. Inchcape’s SUV models include Land Rover Discovery, BMW X3, and Changan Oshan.

The Toyota Urban Cruiser, RAV4 and Fortuner are selling at Sh4.8 million, Sh7.4 million and Sh10 million respectively, according to CFAO Mobility’s website.

Jetour’s entry comes amid a rise in local assembly output and new vehicle sales buoyed by falling lending rates and stable foreign exchange rates.

New vehicle sales rose 24.56 percent in the first nine months of 2025 to 9,924 units from 7,967 in the same period last year, a six-year high, per Kenya Motor Industry Association data.

The majority were commercial vehicles like heavy-duty trucks, mini-buses and pick-up trucks assembled at Isuzu.

Manufacturing bucked a trend of ballooning bad loans in the banking sector in the year ended June 2025, becoming the only major segment in the credit market with improving loan quality.

Non-performing loans (NPLs) in the manufacturing sector dropped 4.5 percent to Sh123.7 billion at the end of June from Sh129.5 billion a year earlier, an analysis of latest Central Bank of Kenya (CBK) report on banking sector asset quality trends show.

The growth in NPL was higher than the 2.6 percent rise in industry gross loans to Sh4.1547 trillion in the review period, underlining that the industry is facing more of a credit quality problem than a supply challenge.

Bankers say the credit quality squeeze reflects broad weakness in the economy, despite interest rate relief touched off by successive easing of the benchmark interest rates by the CBK’s Monetary Policy Committee.

Since August 2024, the CBK has cut the benchmark rate from 13 percent to 9.25 percent, signaling commercial lenders to ease borrowing costs for businesses and households.

‘There is a correlation between the average asset quality in the industry and the quality of the economy,’ Moses Muthui, director of consumer banking at Absa Kenya, said last month.

‘We are dealing with the lag effect of high interest last year. That has not washed out yet. There are inherent weaknesses in parts of the economy.’

Banking insiders have argued that the improvement in NPLs for manufacturing is not because activities in that sector have rebounded, but shows that it probably absorbed impairment pain earlier.

Lenders have been pushing through aggressive loan restructuring cycles from 2023, supported by collateral rules and partial write-downs of legacy exposures.

‘Our recovery teams have enhanced recovery efforts, rehabilitation or restructuring to ensure that our customers’ cash flow matches what we are asking them to pay … .and we have done some write-offs,’ Lawrence Kimathi, KCB Kenya Group’s Finance Director, told an investor briefing in August.

KCB’s NPLs data showed that bad loans held by manufacturing firms dropped to Sh41 billion in June 2025 from Sh49 billion a year earlier.

The CBK data indicate firms in the transport and communication sector posted the sharpest deterioration in the review period, with NPLs jumping 36.1 percent year-on-year to Sh56.5 billion.

This came as the lender cut exposure to the sector by 4.7 percent to Sh326 billion in June 2025 compared with a year earlier, reflecting a pull-back from loss-making PSVs, trucking and cross-border logistics clients.

Households -the single biggest borrower class- saw bad loans rise 17.1 percent to Sh110.8 billion from Sh94.6 billion the year before, followed by traders who recorded a 16.8 percent bump in NPLs to Sh167.9 billion.

Bad loans in real estate increased 15.1 percent to Sh131.6 billion, reflecting struggle by developers and landlords, particularly in Nairobi’s upmarket areas, to find buyers for commercial properties with prices largely flat in recent years.

The NPLs in the building and construction sector also remained in the double-digit growth territory, climbing 15 percent to Sh51.4 billion.

That underscores liquidity distress among small and medium contractors, including road sub-contractors, caught in delayed settlement cycles for government-funded projects.

Agriculture, which is prone to climate-linked shocks, including floods of 2024, saw bad loans edge up 3.1 percent to Sh33.1 billion.

Banks have expanded restructuring, rehabilitation and recovery efforts this year through what aligns repayment schedules with customer cash flows with some executing selective write-offs.

The sector-wide NPL ratio hit 17.6 percent in the second quarter of 2025 from just 16.3 percent a year earlier, before easing slightly to 17.1 percent by the end of September.

As Artificial intelligence (AI) transforms economies globally, there is an urgent question Kenya’s universities and technical and vocational education and training institutions (TVETs) must answer: What is their purpose in the era of AI, and in driving our national ambitions toward Vision 2030 and the Bottom-Up Economic Transformation Agenda?

For decades, the higher and technical education sector understood its purpose largely through access: how many students we could enrol, how many campuses we could build, and how many graduates we could produce. That focus was right for its time. Expanding access was an act of justice, progress and nation-building.

Yet in an age where intelligence has become a shared global resource, quantity is no longer enough. The true measure of purpose and progress must be relevance, and particularly, how well our teaching prepares students to thrive in a future world shaped by artificial intelligence.

Across the world, governments are not waiting for the future to arrive. They are designing for it. In the United Arab Emirates, every citizen now has access to free AI tools.

In Jordan, the Ministry of Education is ensuring that every child learns with AI. In the United States and China, children as young as six are being introduced to AI concepts.

These governments understand that nations at the forefront of AI development will shape emerging industries and set economic standards. Similarly, in the Global North, universities are beginning to see AI not as a threat but as a partner.

They are using it to reimagine teaching, learning and research in ways that make education more adaptive and discovery more dynamic. Kenya cannot afford to be a spectator in this race.

Our universities and TVETs must evolve from institutions that deliver knowledge to generating intelligence.

This means embedding AI not as a single course but as a cross-cutting competence shaping every discipline: from the sciences to the creative arts and humanities. Imagine a TVET student in automotive engineering graduating with an understanding of AI-powered predictive maintenance.

Equipped with that skill, they could help matatu or bus fleet owners use simple sensors to forecast vehicle breakdowns, saving thousands of shillings and improving road safety. That is the power of applied intelligence, turning theory into transformation.

Now picture a law graduate who understands vibe coding and uses that to build a low-cost agentic legal AI for small businesses that cannot afford legal representation.

The outcome is not just innovation; it is inclusion. These examples are within reach if we reimagine curricula, invest in capacity building for educators, and let innovation flow between universities, TVETs and industry.

Innovation is nothing new to us as Africans.

From the metal furnaces of the Haya in ancient Tanzania to intricate irrigation systems that sustained early communities, from the architectural marvels of Great Zimbabwe to the astronomy of the Dogon people, we have always pushed the boundaries of what is possible.

AI now gives us new tools to express that same spirit of ingenuity, and through modern research systems and institutional collaboration, this creative energy can once again be channelled into national transformation.

At the heart of this transformation lies science, research and innovation. From climate-smart agriculture to public health and the creative economy, AI-driven research can become our new engine of growth.

This is already beginning with initiatives such as NRF AI, being developed for the National Research Fund, which gives researchers access to an intelligent research assistant trained on Kenyan and African data but connected to global repositories to ensure that our ideas contribute to global knowledge.

Sustaining this momentum needs bold and visionary leadership across the sector. In this regard, Kenya’s university vice-chancellors and TVET principals have a unique opportunity to turn awareness into action by providing the direction, collaboration and capacity needed to turn promising ideas into lasting national impact.

By embracing AI as a tool for transformation, they can help shape a more innovative, inclusive and competitive Kenya. Yet technology alone will not secure progress. Its real value will lie in how education itself evolves to shape the people, ideas and ethics that guide innovation through that technology.

The question before us is no longer whether AI will change education. It already has. The real challenge is whether education will, in turn, change Kenya and also whether our institutions will be bold enough to lead that transformation.

That transformation will not happen by chance but through the choices our universities and TVETs make today. We owe it to a new generation of Kenyan learners to make the right choices for they will inherit the world we are shaping.

Those choices begin with a new mindset: to view AI not as a threat but as a tool to reimagine teaching and research, expand opportunity and strengthen our nation’s capacity to think and create. In the years ahead, history will not remember who built the most campuses or graduated the most students, but those who equipped our learners with the best ability to thrive in the AI age.

A Mombasa court has been asked to hold Taifa Gas Investments SEZ Ltd, its directors, contractors or agents in contempt over alleged disobedience of court orders temporarily stopping the construction of a Sh16 billion Liquefied Petroleum Gas (LPG) terminus at Dongo Kundu, Mombasa.

In an application at the Court of Appeal, Likoni residents want the directors and principal officers of the company committed to civil jail for a term not exceeding six months.

Taifa Gas is associated with Tanzania’s billionaire businessman Rostam Aziz.

According to the applicants, the court had issued clear and binding orders of status quo directing that the construction be put on hold pending hearing inter partes of an application at the Environment and Land Court (ELC).

At the ELC, the applicants have filed a petition challenging the construction of the LPG terminus.

Taifa Gas then moved to the Court of Appeal seeking to have it set aside orders and directions of the ELC suspending the construction of its 30,000 metric tonnes of LPG terminus.

At the Court of Appeal, parties agreed to comprise on the applications before the court (of appeal) and directions were issued that an application at the ELC be heard and that the status quo subsisting be maintained, meaning the contested construction of the project be put on hold in the meantime.

In their application at the Court of Appeal dated November 5, the residents now claim that Taifa Gas has acted in defiance of the orders and proceeded with constructions works on the project the Court of Appeal ordered halted.

‘Such conduct is not mere omission or inadvertence, it is a calculated, willful and contemptuous affront to the dignity of the court deliberately engineered to mocks its authority and render its lawful orders impotent,’ argue the applicants.

They claim that unless restrained, Taifa Gas will have accomplished by illegality that which the law has forbidden thereby making the court process a mere academic exercise.

Messrs Karungu and Nyiro also argue that the court has inherent power and jurisdiction to punish for contempt and enforce its orders against any party who seeks to undermine its authority, underscoring that court orders are not suggestions or opinions but commands that must be obeyed.

They also want the court to direct immediate cessation of all construction or related activities by Taifa Gas on the project site pending full compliance with the orders and further directions from the court.

In their petition at the ELC, the applicants say they are residents of Likoni close to the project by Taifa Gas.

They contend that the respondent has proposed to construct the LPG plant and intends to clear indigenous natural trees and vegetation and excavate the land to provide space for the LPG tanks which will lead to soil erosion and environmental degradation of the land and its environs.

‘The petitioners aver that clearing the vegetation will interfere with the coral rock and will negatively affect the eco-system around the land,’ part of the petition states.

According to the petitioners, the project by Taifa Gas involves the construction of a pipeline which will lead to suspension of sediments that will ruin the quality of water and penetration of light for the ecosystem within sea water.

‘The petitioners also contend that the construction of a pipeline will ruin the fishing grounds which is a source of livelihood for the local population,’ argue the petitioners who have named the National Environment Management Authority (Nema) as an interested party in the case.

The petitioners argue that the proposed development will have adverse environmental and land use impacts on the land including the depreciation of the environment, increase in pollution, increased vehicular and human traffic and rise in insecurity which will pose a great threat to the inhabitants around the land.

They want a conservatory order of injunction issued to restrain Taifa Gas from carrying out deleterious activities, carrying out construction or works including but not limited to setting up of the LPG terminus without prior compliance with Articles 10, 40, 42 and 69 of the constitution.

The petitioners also want a declaration that Taifa Gas unauthorized construction, felling and destruction of indigenous trees, excavation or proposed commencement of works to set up the LPG terminus without prior notice to consent, consultation or compensation to them and compliance with mandatory provisions of the law is illegal, unconstitutional, null and void.

They are also seeking compensation from Taifa Gas for destruction of the environment, indigenous trees and vegetation and excavation works in violation of the law.