Category: Business Daily

The average retail price of sugar in Kenya rose for a fourth consecutive month in July 2026, defying expectations of a drop because production of the commodity rose by more than a third in the first half of the year.

Domestic sugar output rose 35.2 percent to 437,852 tonnes between January and June, the highest first-half production according to data by the Kenya National Bureau of Statistics (KNBS).

Cane deliveries increased even faster, climbing 36.2 percent to 4.93 million tonnes, pointing to a recovery in raw material supplies to sugar factories after a steep slump last year.

However, average retail sugar prices have been rising since April, increasing from Sh164.35 per kilogramme that month to Sh167.41 in July, according to data collated by KNBS.

The price reversal raises questions about the government’s efforts to revive the sugar industry, improve efficiency and eventually make sugar more affordable through greater competition and private investment.

Average retail prices had fallen steadily from Sh186.78 per kilogramme in July 2025 to Sh166.56 in February this year, before reaching a low of Sh164.35 in April.

They subsequently rose 0.8 percent in May, 0.58 percent in June and another 0.47 percent in July, suggesting that the decline in prices had stalled.

The increase, although marginal, came despite sugar output rising above the previous first-half peak of 410,536 tonnes recorded in 2022, indicating that higher domestic production alone has yet to deliver sustained consumer price relief.

The development also raises questions about whether increased cane availability and the leasing of State-owned mills are translating into lower production costs and stronger competition across the sugar market.

President William Ruto’s administration leased Nzoia, Chemelil, Sony and Muhoroni sugar factories to private investors in May 2025 under 30-year agreements intended to inject capital, modernise equipment and improve management.

The government argued that private operators would improve efficiency, reduce costs and strengthen the competitiveness of the mills, which have historically depended heavily on State support.

However, a joint November 2025 report by the World Bank Group and Competition Authority of Kenya found that domestic sugar was significantly more expensive to produce than imported alternatives.

The gap, the report said, has widened over the years, raising concerns about whether reforms in the industry will translate into lower prices for households.

The report, titled From Barriers to Bridges, warned that leasing the State-owned mills could fail to deliver genuine market discipline unless competition concerns surrounding the leasing process and the wider sugar market are addressed.

‘The GOK has sought to increase private investment and market discipline through the leasing of state-owned mills, although competition concerns remain,’ the report said.

It also blamed years of government financial support for distorting competition, arguing that debt write-offs and direct grants shielded inefficient State-owned factories from market forces while restricting the expansion of more efficient private operators.

The Ruto administration wrote off Sh117 billion owed by State-owned sugar factories in 2023, including loans from the Sugar Development Fund as well as accumulated taxes and penalties.

A further Sh62 billion debt was written off in 2020 under the administration of President Uhuru Kenyatta, according to the World Bank-CAK report.

The study found that Kenya’s ex-factory sugar prices rose by more than 40 percent annually in both 2022 and 2023, outpacing increases in cane prices and diverging from global trends.

The Agriculture Ministry has recently tightened protection for local producers through taxation and import controls.

The Finance Act 2026 in July raised excise duty on imported sugar to Sh40 per kilogramme from Sh7.50.

In August, the Kenya Sugar Directorate halted issuance of new sugar import licences, with Agriculture Cabinet Secretary Mutahi Kagwe saying domestic production was now sufficient to meet demand.

‘I have asked the Kenya Sugar Board to stop sugar imports,’ Mr Kagwe said, arguing that imports should not disrupt the local market or undermine the domestic industry.

The policy shift places greater pressure on the leased mills to demonstrate that increased production can eventually translate into lower costs, stronger competition and better prices for consumers.

‘Henceforth, I do not want any licence issued for sugar imports. We are going to ensure we do not mess up the internal market because of imports. We are not going to import sugar at the risk of the local industry,’ Mr Kagwe said on August 6.

This came after the government earlier in the year moved to expose the industry to greater regional competition after exiting the Comesa sugar import safeguard regime in January, ending 24 years of protection against cheaper regional supplies.

The safeguards, introduced in 2001, allowed traders to import up to 350,000 tonnes of sugar annually from Comesa to bridge domestic deficits while protecting local millers from lower-cost competition.

A growing number of institutional investors are shifting to innovative off-balance-sheet financing (OBSF) schemes in East Africa, a regional lender said, lured by the rising appetite for infrastructure project funds by governments in the bloc.

OBSF is an accounting practice that structures certain assets or liabilities of governments or corporations so they don’t appear on the balance sheet, therefore creating some financial breathing space.

It involves omitting certain capital expenditures or assets from the balance sheet and is commonly used by businesses that are highly leveraged, especially when taking on more debt means a higher debt-to-equity ratio, which can attract higher interest charges.

‘We have seen a shift from the traditional plain vanilla lending and towards more structured type lending, and we are seeing pension funds becoming very influential in this region because of the financial muscle that they hold,’ Absa Investment Bank’s Director for East Africa, Daniel Odongo, told Business Daily.

‘Kenya has about $ 22 billion thereabouts worth of pension assets; we have half that size (about $11billion in Tanzania), about $8 billion in Uganda, and roughly $3 billion in Rwanda.’

Pension funds in East Africa hold Sh5.7 trillion worth of assets under management.

The region’s pension funds, which have traditionally been concentrated in investing in risk-free government paper, are now driving the appetite for emerging solutions such as securitisation as they seek to rebalance their portfolios and unlock better returns for their investors. ‘Government securities continue to play a significant role as an asset class, and a lot of the pension funds do invest in them.

However, we are seeing a shift in this trend as many look for diversification because pension funds are holding retirement money and therefore have to think long-term and find matching assets,’ Odongo says.

The official said that OBSF has become popular amid pressure for infrastructure capital.

‘Off-balance sheet is really about governments, or even corporates, leveraging their assets to raise financing without having to book in additional debt. Public-Private Partnerships are one case in point. We have securitisation, with a good case in point in the Kenyan market where the Roads Board was able to raise capital on the back of future revenues. So, it’s all about using a predictable source of revenue and using that to actually raise financing today’, Mr Odongo said.

Kenya has recently securitised cashflows related to its Roads Maintenance Levy to unlock financing for settlement of arrears owed to road contractors so as to kick-start projects that had stalled across the country.

The government has also securitised cashflows into the Sports Fund to mobilize Sh44.0 billion worth of financing for the 60,000-seater Talanta Stadium, in Kenya’s first asset-backed listing at the Nairobi Securities Exchange.

The government of Kenya has signaled plans to accelerate payment of verified pending state arrears over the next two years, a stance that potentially signals more opportunity for institutional investors like pension funds looking to tap into alternative asset classes for investment.

‘The Pending Bills Verification Committee reviewed 91,911 claims valued at Sh637.6 billion, recommending settlement of 29,885 claims worth Sh235.6 billion. Sh80.3 billion has already been settled through securitisation, the remaining Sh155.3 billion will be settled over two years beginning 2026/27 through a combination of budgetary allocation and securitization’, National Treasury Principal Secretary Chris Kiptoo said during the launch of the 2027/28 budget cycle.

As at the close of May 2026, Kenya’s stock of public debt stood at Sh12.89 trillion, accounting for 68.8 percent of the country’s Gross Domestic Product (GDP), with domestic debt accounting for Sh7.24 trillion while external debt accounted for Sh5.66 trillion.

Nine of the country’s 11 banks listed on the Nairobi Securities Exchange, which have released their performance results for the six months ended June 2026, posted a combined Sh144.9 billion net profit, up 16.9 percent from Sh124 billion a year earlier.

The improvement comes as banks benefit from a more favourable operating environment in which interest rates have fallen, credit demand is recovering, and the cost of funding has declined faster than lending rates.

The Central Bank of Kenya (CBK) cut its benchmark Central Bank Rate to 8.75 percent in February and has maintained it at that level, down from 13 percent at the start of the monetary easing cycle in August 2024.

By June, the average commercial bank lending rate had fallen to 14.4 percent from 15.3 percent a year earlier, while the mean deposit rate dropped much faster to 6.8 percent from 8.4 percent. The faster decline in deposit costs widened the industry interest-rate spread to 7.5 percent from 6.9 percent.

That shift is visible in the half-year numbers of KCB Group, Equity Group, Co-operative Bank of Kenya, NCBA, Absa Bank Kenya, Standard Chartered Bank Kenya, Diamond Trust Bank (DTB), Stanbic Holdings and Family Bank, which are the nine lenders used in this analysis.

Interest expenses for the nine lenders fell 7.2 percent to Sh111.6 billion as interest income rose 6.9 percent to Sh391.2 billion. Net interest income increased seven percent to Sh275.4 billion during the review period.

That shift is visible in the half-year numbers of KCB Group, Equity Group, Co-operative Bank of Kenya, NCBA, Absa Bank Kenya, Standard Chartered Bank Kenya, Diamond Trust Bank (DTB), Stanbic Holdings and Family Bank, which are the nine lenders used in this analysis.

Interest expenses for the nine lenders fell 7.2 percent to Sh111.6 billion as interest income rose 6.9 percent to Sh391.2 billion. Net interest income increased seven percent to Sh275.4 billion during the review period.

The recovery in asset quality has provided another lift. Gross non-performing loans across the nine banks fell 8.9 percent to Sh554.3 billion, with Equity, Absa and KCB recording some of the biggest reductions in the stock of bad loans.

Equity was the biggest beneficiary of the trend, lifting net profit 31.5 percent to Sh43.8 billion and contributing roughly half of the overall increase in profits among the banks analysed.

The lender’s gross non-performing loans (NPLs) fell 22.2 percent to Sh108.4 billion, while provisions for bad loans declined 11.6 percent.

Its NPL ratio improved to 9.5 percent from 13.7 percent last June following aggressive collection by the lender and what it termed ‘disciplined underwriting, improved analytics and a diversified portfolio.’

KCB, the second-largest profit generator, also combined stronger business with improved asset quality. Its profit rose 14 percent to Sh36.9 billion as gross NPLs fell 7.8 percent to Sh203.8 billion. Its NPL ratio improved to 15.1 percent from 18.7 percent.

‘NPLs improved as targeted resolution initiatives, including recoveries, rehabilitations, full and final settlements, government engagements on associated entities, and strategic write-offs, delivered positive outcomes,’ said KCB.

Co-op Bank and DTB posted some of the fastest profit growth during the half-year. Co-op’s earnings rose 28 percent to Sh18 billion as its NPL ratio improved to 13.9 percent from 17.2 percent, while DTB recorded a 34.1 percent jump to Sh6.4 billion.

However, the improvement in asset quality was not uniform, pointing to the uneven recovery across the banking industry given differences such as the type of clients.

Family Bank was the standout performer on profit growth, with earnings jumping 61.8 percent to Sh3.7 billion. However, its gross NPLs increased 19.2 percent to Sh18.1 billion, making it an outlier in an industry where bad loans generally fell. The rise in gross NPLs saw Family Bank step up provisions for loan defaults by 50.5 percent to Sh998.25 million.

‘Our interest is not just to report good numbers. Our interest is also to protect the asset that we are entrusted with by our shareholders and the economy at large. We are very deliberate in ensuring that the required accounting standards are followed,’ Paul Ngaragari, chief finance officer at Family Bank, said.

DTB also recorded a six percent increase in gross NPLs, while that of NCBA rose 5.7 percent. The profit growth of the two lenders was influenced more by stronger lending income, lower funding costs and other revenue streams and less to do with falling stock of NPLs.

StanChart and Absa saw their net profits fall 16.8 percent and 9.8 percent respectively, making them outliers. Stanbic was another outlier, with profit edging up just 1.3 percent despite a 25 percent expansion in its loan book.

The disclosures of the nine lenders signal a sector moving from a defensive phase of managing expensive funding and elevated defaults towards renewed credit growth.

Private-sector credit growth accelerated to 10.6 percent in June, the fastest pace in 28 months, as lower lending rates improved demand from businesses and households.

Here is an uncomfortable truth: Kenya taught the world how to move money on a mobile phone, yet it still cannot tell you with any confidence how well its hotels are pricing a Tuesday in April.

This is the country that built M-Pesa, earned the name Silicon Savannah, and launched a National Artificial Intelligence Strategy in March 2025 with the explicit ambition of leading the continent. Its tourism sector, the most dependable foreign exchange earner, remains one of the least digitally mature parts of the economy.

The commercial performance makes the gap harder to see, not easier. Kenya generated roughly Sh500 billion in tourism earnings in 2025, welcoming 7.9 million visitors in total. International arrivals rose from 2.47 million to 2.7 million, growth of about nine percent against a global average nearer four percent, and the fifth consecutive year of revenue growth. Kenya is now the most visited destination in East Africa.

Those are genuinely good numbers, achieved substantially without the tools the rest of the industry has come to take for granted.

There is no sector-wide audit of technology adoption in Kenyan hospitality. The nearest comparable evidence on the continent comes from our own research further south, where the 2025 HAMAC South African Hoteliers Report found that while 77 percent of hoteliers said they were actively exploring new technology, fewer than 38 percent were using AI in revenue management and more than a third had no AI strategy at all.

That is a sector collecting brochures and calling it progress. Kenya’s digital economy is more advanced than South Africa’s in several respects, but very little of that advantage has reached the hotel floor.

Globally, hotels using AI-driven revenue management report an estimated 17 percent increase in total revenue against those still relying on traditional methods, and more than 86 percent of hoteliers internationally now depend on AI for forecasting and demand analytics.

BCG’s analysis with NYU found that fewer than 10 percent of hospitality companies worldwide could be described as genuinely ‘future built’ in AI capability, with only a quarter in a scaling phase where strategy begins to generate real returns.

Kenyan operators are not competing against each other. They are competing against that benchmark, and against Egypt and Morocco, both of which are investing heavily in infrastructure, hotel capacity and promotion.

To understand why this matters as much as it does, consider the weight the sector is being asked to carry. The World Travel and Tourism Council put travel and tourism’s contribution to Kenya’s economy at around Sh1.2 trillion in 2025, more than seven percent of GDP, sustaining at least 1.7 million jobs or roughly eight percent of national employment.

The government is targeting 10 percent of GDP from tourism by 2027 and 5.5 million arrivals, ambitions formalised in the National Tourism Strategy for 2025 to 2030.

These are not modest targets. They are the kind of numbers that require the sector not simply to grow, but to become measurably more productive.

Record earnings are not the same as readiness for the next five years. The industry is at a fork. One path leads to competing seriously on the global stage, with the digital sophistication Kenya has already proved it can produce.

The other leads to becoming a beautiful destination with world-class properties and an analogue back end.

The country that taught the world mobile money should not be running its hotels on instinct and spreadsheets, and the window for choosing which path we take is narrowing faster than most people are prepared to admit.

Arrival growth alone will not deliver that. A sector can outperform the global average, break its own earnings record, and still be falling behind on the metrics that determine long-term competitiveness.

This is an industry of national consequence being asked to carry significant economic weight at the very moment it faces one of its most serious long-term risks: a structural gap between digital aspiration and operational reality that, left unaddressed, will compound quietly until it becomes very loud indeed.

Grid fragility is quietly deciding what gets built

The reason this gap exists is not ignorance, and it is not laziness. It is something more structural, and in Kenya’s case it is more subtle than a simple shortage of capital.

On the night of 29 July this year, a technical disturbance on the national grid plunged Nairobi, the Coast, Mount Kenya and parts of the Central Rift into darkness for hours. It followed a near-nationwide outage in December 2025 traced to the Kenya-Uganda interconnector.

The President acknowledged in late 2025 that demand was outstripping supply and that evening rationing was necessary to prevent a wider collapse, putting the cost of expanding capacity toward 5,000MW at around KSh1 trillion.

Ketraco has identified a transmission financing gap of roughly $4.4 billion, while system losses ran above 23 percent in 2025 against an allowable benchmark closer to 17.5 percent.

For a hotelier, every one of those events is an argument for the spreadsheet. Modern revenue management is always-on, cloud-dependent and data-hungry. It assumes continuity.

When continuity is the thing you cannot count on, the rational short-term response is to keep the critical decisions in a system you can run on a laptop with a charged battery, and to spend the available capital on generators, inverters and solar rather than on data infrastructure. That instinct is entirely defensible.

It is also, compounded over five years, how a sector falls behind. When the choice is between fixing what is broken and building what is new, the broken thing wins every time. But while you are fixing it, the world keeps moving.

The capability gap is just as dangerous as the capital gap

Even where a budget exists, the human capacity to deploy technology effectively is often missing. Kenya is unusually well placed here and is not using the advantage. Kenya Utalii College has trained more than 60,000 graduates over five decades and is one of only three African members of the international association of hotel schools. Few countries on the continent have an asset like it.

The National AI Strategy, meanwhile, contains a serious talent development pillar and commits to integrating AI and digital skills into education curricula. Its priority sectors are health, agriculture, education, finance and public service.

Tourism, which delivers more than 7 percent of GDP and 8 percent of national employment, does not appear among them. A country cannot credibly target 10 percent of GDP from a sector it has left off its own AI roadmap.

The capabilities in question are not exotic. They are what is needed to interrogate AI outputs, manage digital systems with confidence, and build the data-informed culture that makes technology investment worthwhile rather than wasteful.

Buying a revenue management system and staffing it with people who cannot challenge what it recommends is not digital transformation. It is an expensive decoration. Graduates arrive equipped for the industry that existed, not the one that is emerging.

We need coordinated action

Kenyan hoteliers are resilient. They have traded through election cycles, security advisories, a pandemic that cut revenues by 70 percent in a single year, and a grid that fails without warning. But resilience is not a digital strategy, and surviving is not the same as competing.

The solution requires action from the entire ecosystem. Government must treat reliable power as a precondition for sectoral competitiveness rather than an aspiration, and should bring tourism formally into the National AI Strategy’s priority sectors, where its economic weight plainly earns it a place.

Training institutions must embed data literacy and digital fluency into every hospitality curriculum as a core requirement rather than an elective. Industry bodies must build the practical capability support and shared frameworks that individual operators cannot develop in isolation.

Bond prices in the secondary market at the Nairobi bourse have come down compared to a year ago as interest rates rise in the wake of the war in Iran, cutting the profits for those opting to sell their bonds before maturity.

In their half-year financial results, listed banks say they recorded a paper loss of Sh7.2 billion on the value of their government bonds due to the secondary market price movement.

A sample of listed bonds shows that majority are trading at market prices that are lower compared to last year, backing the revaluation by banks.

On the shorter end of the market, a three-year bond issued in January 2024 is now trading at Sh104.95 per unit of Sh100, down from Sh111.18 in June 2025.

A five-year bond issued in July 2023 has seen its price fall from Sh115.56 to Sh111.47 in the period. Similarly, long term bonds are also trading lower, with a 20-year paper issued in April 2019 trading at Sh95.62 per unit, from Sh99.15 last year.

A unit of a bond is priced at Sh100 when the paper is first issued by the Central Bank of Kenya (CBK) in what is known as a primary sale.

But they usually sell above or below this price in the secondary market at the Nairobi Securities Exchange (NSE) depending on the prevailing demand, which is determined largely by whether new bonds coming into the market are paying higher or lower rates in comparison.

Therefore, bond prices and yields in the secondary market have an inverse relationship, where a rise in one accompanies a fall in the other. These market prices are used when reporting the fair value of securities, including those holdings in the hands of commercial banks, pension funds and insurance companies.

Bankers Sh7.2 billion paper losses are in contrast to the gain of Sh46 billion the lenders reported on their balance sheets in the corresponding period in 2025, when falling interest rates resulted in higher bond prices.

The change in valuation has come after yields in the NSE bonds market rose from the end of February after the start of the war in Iran spooked global markets, pushing rates higher. Inflation also jumped due to higher energy prices, forcing investors to demand higher returns from bond issuers to cover against erosion of real returns.

The price falls however do not affect securities issued at a high premium of between 15 and 18 percent- such as the infrastructure bonds of 2023 and 2024-still attracting high prices because new bonds cannot match their returns. The 8.5-year infrastructure bond sold in February 2024 at 18.46 percent is still trading at Sh122.25 per unit, compared to a price of Sh122.39 in June 2025.

When rates on new bonds coming into the market in primary sales are falling, holders of existing papers that pay higher interest rates demand higher prices in order to sell their units in the secondary market, given that they would not get similar returns when reinvesting the funds in new bonds.

Alternatively, if interest rates on newly issued bonds are rising, holders of existing securities that pay lower returns are willing to sell at a discount in order to reinvest the proceeds in the higher paying paper. For banks, financial reporting standards demand that they report the value of their bond holdings held for trading purposes based on current market prices, rather than the historical cost of acquisition.

Therefore, when publishing their financials, they can either indicate an unrealised gain or a loss on their holdings, depending on the movement of bond prices in the Nairobi Securities Exchange (NSE).Banks also hold other securities beyond Kenya government bonds and Treasury bills, whose current market valuations are also factored in when calculating the fair value losses or gains.

These include holdings of sovereign bonds such as the Kenya Eurobonds. However, the fair value gains or losses can only be realised in the event of a sale of the securities, meaning that they do not affect the lender’s net profit so long as they remain in hand.

The risk to the large local banks from the price fluctuations of these securities (known as sovereign exposure risk) is seen as minimal due to their high liquidity and diversified sources of deposits, especially from the large pool of retail depositors, which makes it unlikely that they would need to liquidate the bonds under distress.

Private hospitals are borrowing billions of shillings to buy MRI machines, dialysis units and other specialist equipment, as banks build a fast-growing lending business around the country’s push into advanced healthcare.

As they expand into oncology, cardiology, renal care, fertility, and advanced diagnostics, private hospitals, faith-based facilities, clinics, and diagnostic centres are turning to bank loans to acquire MRI machines, dialysis units, linear accelerators, mammography machines, and other specialised equipment.

Equity Bank alone has lent about Sh33 billion to the healthcare sector over the past five years, channelling Sh11.5 billion of it for medical equipment, as private hospitals, faith-based facilities and diagnostic centres turn to asset finance rather than wait to save up the cash.

‘This product was developed to address the financing gap in acquiring medical equipment and to support healthcare providers in enhancing service delivery and expanding access to quality healthcare services,’ Joseph Mbai, the General Manager and Team Leader for the Health Sector at Equity Bank, told the Business Daily.

The need for capital is particularly acute in Kenya, where significant gaps in access to specialised equipment persist. The country has around 50 MRI scanners, most of which are concentrated in Nairobi and a few other major centres.

This uneven distribution leaves many parts of the country dependent on facilities outside their regions for advanced imaging, therefore creating a financing market around medical equipment.

‘We have recently financed 30 renal dialysis units, two MRIs, one piece of cardiology equipment, two linear accelerators, one genetic sequencer and one mammogram machine,’ said Dr Mbai.

This equipment enables private facilities to expand their services beyond general medical care to include those that require significant investment in machinery.

For example, a dialysis unit enables a hospital to provide renal treatment, and a linear accelerator allows it to develop radiotherapy services. An MRI machine enables a facility to perform imaging scans on patients within its network instead of referring them elsewhere.

The increased investment in equipment purchases and upgrades is partly driven by demand for specialist treatment in Kenya, as well as the country’s emergence as a regional healthcare destination.

This shift is encouraging hospitals to invest in specialised services such as oncology, renal care, cardiology, imaging, laboratory diagnostics, fertility, ENT and orthopaedics, thereby keeping patients at home instead of sending them abroad for treatment.

Apart from Equity Bank, other lenders have also developed similar products as hospitals seek ways to acquire equipment without bearing the full cost upfront.

The Co-operative Bank has a dedicated healthcare proposition that finances or leases equipment such as MRI and X-ray machines, as well as surgical tools. Its healthcare offering also includes working capital lines and payment collection tools designed for hospitals, clinics, and diagnostic centres.

The bank’s Africa Medical Equipment Facility (AMEF), which was developed in partnership with the International Finance Corporation (IFC), GE Healthcare, Philips Healthcare and KARL STORZ, provides financing for clinics, hospitals, medical imaging centres and laboratories. Under the facility, individual healthcare providers can access loans and leases ranging from $5,000 (Sh645,000) to $2 million (Sh258 million).

‘This partnership with the IFC and Philips will enable the Co-operative Bank to extend credit to a wider range of investors in the healthcare sector,’ said Gideon Muriuki, the bank’s Group Managing Director and Chief Executive Officer, at the launch of the product.

For smaller hospitals and diagnostic centres, the facility provides an alternative to funding the full purchase price of equipment from their own cash reserves.

Meanwhile, I and M Bank entered this market in 2019 with a product initially aimed at its premium banking clients, covering X-ray, dialysis, theatre, ICU, ultrasound, radiology, sterilisation and laboratory equipment.

‘We believe that this financing will help our customers in the healthcare industry accelerate their business growth while contributing to universal healthcare,’ said the lender during the launch.

Customers financed under the product also receive discounted all-risk insurance cover for the equipment through I and M Insurance Agency, as well as insurance premium financing, which spreads lump-sum premiums into monthly instalments.

In May 2026, Absa Bank Kenya moved deeper into the market when it relaunched its asset financing arm with a Sh100 billion financing capacity over three years. Medical equipment for hospitals, clinics, and laboratories was named as one of its priority categories.

While these financing products enable hospitals to acquire equipment without first accumulating the full purchase price, they also create a repayment obligation dependent on the equipment generating sufficient income.

Kenya’s energy sector story in 2026 is one of growth, transition and ambition. From the wind farms of Turkana to the geothermal wells of Olkaria, from LPG in our kitchens to fuel at the pump, one institution sits at the centre of it all: the Energy and Petroleum Regulatory Authority (Epra).

While headlines often focus on tariffs, fuel prices and blackouts, the real driver of progress is less visible – a strong legal and regulatory framework backed by consistent regulatory practice. Good regulation is the difference between a sector that functions efficiently and one plagued by uncertainty.

The Energy Act, 2019 and the Petroleum Act, 2019 gave Epra a clear mandate to regulate, licence and protect consumers without operating energy companies. This separation of policy, regulation and operations has created confidence among investors in independent power producers, public-private partnerships and LPG infrastructure.

Clear licensing timelines, transparent tariff methodologies and dispute resolution mechanisms have helped attract billions of shillings in private investment into solar, wind and gas projects. Without regulatory certainty, Kenya’s ambition of universal energy access would remain difficult to achieve.

Every month, Kenyans closely watch changes in fuel and electricity prices. Epra’s formula-based fuel pricing reviews and periodic electricity tariff reviews have made pricing more transparent by publicly accounting for factors such as global fuel costs, inflation and exchange rates.

The framework seeks to balance consumer protection with the financial sustainability of utilities responsible for delivering power and fuel.

Epra also plays a critical role in safety and consumer protection. From ensuring fuel pumps are accurately calibrated to enforcing LPG cylinder standards, its oversight helps protect lives and livelihoods.

Kenya is also a global leader in renewable electricity generation, with more than 90 percent of its electricity coming from renewable sources.

The sector is evolving rapidly, bringing new regulatory challenges in electric mobility, battery storage, green hydrogen and cross-border electricity trade. Meeting these opportunities will require greater data transparency, faster digital licensing and continued public participation.

The hardest job of a regulator is balancing affordable prices with a financially viable energy sector. A strong regulator does not slow development – it creates the certainty that powers it.

The writer is Director – Legal, Regulatory and Governance Services, Energy and Petroleum Regulatory Authority (Epra)

From the Mt Ololokwe summit, the vast Samburu landscape stretches into the horizon, its rugged plains and distant hills offering the kind of scenery that draws tourists for sunrise and sunset splendour.

On Wednesday morning, six tourists climbed into a helicopter to experience that view. They were filming and taking photographs when their holiday turned into a tragedy.

The helicopter had barely completed its third sweep over the summit when the tourists began capturing what would become their final images of the spectacular mountain . Moments later, the helicopter crashed down the rocky face, killing all seven people on board, including the pilot. The six tourists had been flown from Suiyan in Loisaba Conservancy, Laikipia County.

Local tour guides and porters who witnessed the final moments of the ill-fated flight told the Nation that the helicopter had circled the rocky summit several times before landing at a spot popular with tourists.

Mr Raphael Lekambayo, a tour guide based in Kirish village, said colleagues who were at the summit told him the visitors were recording the scenery when the helicopter go out of control.

‘At the time, the aircraft was hovering near the edge of the cliff. On noticing that all was not well, some of the passengers threw out their phones, which were recovered by the guides,’ Mr Lekambayo said.

‘The chopper’s rear propellers appear to have hit the edge of the cliff, leading to the fatal fall,’ he added.

For those on the ground, there was little time to comprehend what was happening. Mr Peterson Leadekei, one of the first responders, said he and others watched the helicopter circling the mountain before seeing it come down.

‘We were not very far from the scene because we saw the helicopter circling and landing successfully. Shortly after, we saw it crashing,’ he recounted.

By the time rescuers reached the scene at about 10am, the wreckage was in flames.

The helicopter had plunged vertically down a cliff estimated to be about 300 metres high, coming to rest among trees and rocks at the foot of the mountain, about 10 kilometres from the Isiolo-Moyale highway.

Earlier, local tour operator Mr Diba Ngera had warned that the summit experiences strong winds, prompting residents to erect signs cautioning pilots about the risks.

‘Although there has never been an accident on the hill, we recognised the danger and put up warning signs. The community has also prepared an airstrip, but tourists prefer to land at the peak,’ he said.

A Nation team that visited the scene found that the aircraft had been torn apart. The recovery teams faced the grim task of cutting through the burnt wreckage to retrieve the victims.

The recovery operation was completed on Thursday after all the bodies were retrieved.

Some of the victims were burnt beyond recognition and were taken to Nairobi for DNA analysis, while the other bodies were transferred to Lee Funeral Home.

‘We have concluded the operation and handed over the site to the aircraft accident investigation teams. They will try to establish the cause of the accident,’ Samburu County Police Commander David Nkoroi said.

The crash claimed the lives of Kenyan pilot Josh Outram, five Americans and an Ecuadorian.

Mr Outram, the director of African Heli Adventures, was an experienced pilot who had spent years operating in the rugged northern Kenya, including as a tour operator and in security surveillance within wildlife conservancies.

In an earlier interview with Loisaba’s Elewana Collection, he spoke passionately about the landscapes he had spent years flying over.

‘I am hugely passionate about flying and what Kenya has to offer. The North has some of the most diverse landscapes over a very short distance. What I get to see every day is something that I feel everyone coming through Kenya should to see. Truly, it is some of the most mind-blowing landscapes that most people in Kenya don’t realise exist. A helicopter opens up the opportunity to see this,’ he said in the interview.

Ecuador’s intelligence chief, Michele Sensi-Contugi and his wife, Stephany Hollihan Yeaza, who held Ecuadorian and American citizenship were among the dead.

Their deaths were officially confirmed in a statement posted on the Ecuador president’s official X account.

‘At this moment of profound grief, the National Government extends its deepest condolences to their families, loved ones and close associates, whom it accompanies with respect, solidarity and affection,’ the statement posted on X read.

According to Ecuadorian media, Sensi-Contugi served as Minister of the Interior from April to August 2024, before taking over as director of the National Intelligence Centre. He is said to have been a close confidant of Ecuador President Daniel Noboa.

The other victims were Roger Edward Duarte, José Alberto Suárez, Adam Hlavaty and Henry Parra.

American media outlet NBC 6 said the death of Suárez, 55, was communicated through a joint statement by NBCU Newsgroup Chairman Cesar Conde, NBCU Local Chairman Valari Staab and Telemundo Station Group President Jose Cancela.

‘We are heartbroken to learn the tragic news that José was killed in a helicopter accident in Kenya. José was an exceptional colleague who cared deeply about his teams, the communities they ‘He brought energy, humor, warmth and a strong sense of purpose to his work, and his impact was felt far beyond the stations he led. Our hearts are with his loved ones, and with all of José’s colleagues and friends who are grieving this terrible loss.’

The US media outlet further reported that the death of Duarte, 39, was confirmed by his family in a statement.

‘The Duarte and Valls families are devastated and heartbroken by the tragic helicopter accident in Kenya that claimed the lives of our beloved Roger Edward Duarte, our dear friends Jose Suarez, Adam Hlavaty, Henry Parra, Michele Sensi-Contugi, and Stephany Holliham Yeaza, as well as Josh Outram, the helicopter’s pilot,’ read the statement.

‘The magnitude of this tragedy is impossible to comprehend, and there are no words to express the depth of our pain. We ask that you keep them all and everyone who loved them in your prayers. We respectfully request privacy as our families grieve this unimaginable loss,’ it added.

The aircraft in the tragedy belonged to Lady Lori, a chartered helicopter operator. The Kenya Civil Aviation Authority identified the aircraft as a Eurocopter EC130 B4, registration 5Y-GYM.

The Samburu landscape is a popular destination for high-net-worth individuals who frequent its remote and luxurious lodges.

‘Can you give me 500 grammes of tenderloin, 400 grammes of ribeye and T-bone? You might also get someone saying, ‘I just want a nice, decent one-inch steak of this cut and this cut,’ just to have that experience and choose which one I prefer,’ says Omar Tamimy, the director of Merino Meats.

This is increasingly becoming the new way of ordering as meat lovers move beyond buying ordinary cuts sold by the kilo to premium steaks that can be ordered in portions as small as 250 grammes – enough to offer a taste of richer flavour, greater tenderness and a more refined dining experience.

Kenya’s beef market is carving out a new niche: ribeye, tenderloin, porterhouse, striploin, picanha and t-bone are no longer just indulgences in five-star hotels and upscale steakhouses. People are buying to cook in their homes.

Mr Tamimy says managing supply is also important during the peak periods such as November and December.

‘You can’t be taking in a lot of supply of beef just to get a few particular cuts. If we know we are getting tenderloin steaks and ribeyes from a specific section, we tend to take more hindquarters because that is where most of these premium sections come from.’

During peak seasons, the business balances full carcasses with quartered or half-sectioned carcasses to meet the demand meant for both premium and ordinary cuts.

What are consumers paying for when it comes to premium meat?

Timothy Kipng’etich, a trainer and meat grader at the Meat Training Institute, adds that premium beef begins with understanding the animal itself.

‘Many people think the most expensive cut automatically becomes a premium cut, but premium cuts are defined by quality and where they come from on the carcass,’ he says.

Most premium cuts, including tenderloin, T-bone, striploin, topside and silverside, are obtained from the hindquarter.

‘The muscles in those areas do very little work during the animal’s lifetime, which makes them naturally tender. Compare that with muscles such as the neck, brisket and shank, which support the animal’s movement. Those muscles develop more connective tissue and collagen, making the meat tougher,’ Mr Kipng’etich explains.

Breed also matters.

Mr Kipng’etich says breeds with better feed conversion rates, such as Boran and Charolais, generally produce better-quality carcasses suitable for premium markets.

Age is equally important. ‘The younger the animal, the more tender the meat. As animals grow older, the collagen fibres become tougher, reducing tenderness,’ he says.

He notes that bulls intended for premium beef are commonly slaughtered at around 18 months, while heifers are processed at about 42 months.

The feeding practices further influence quality.

Consequently, consumers often associate premium steaks with marbling, which is the fine streaks of fat running through the muscle.

‘Marbling contributes to tenderness, juiciness and flavour,’ he says.

He adds that grain-fed cattle would produce more marbling than grass-fed animals.

‘Some customers prefer less fat, forcing butcheries to trim away some of the marbling before sale. That also affects profitability because trimming reduces the saleable weight.’

Even after slaughter, the work is far from over. Proper ageing allows natural enzymes to break down muscle fibres, which improves the tenderness and flavour over time.

‘Ageing is one of the factors that enhances the eating quality of premium beef,’ Mr Kipng’etich says.

He cautions that expensive meat should not be mistaken for healthier meat.

‘Premium pricing doesn’t necessarily mean healthier meat. Good farming practices, proper feeding and safe production systems remain the most important determinants of quality.’

Kenya is hoping to unlock up to Sh151.2 billion from the World Bank Group in the current 2026/2027 fiscal year as the multilateral lender remains the country’s primary source of external financing in the absence of the International Monetary Fund (IMF).

A debt plan by the National Treasury for 2026 shows that Kenya expects funding from three World Bank support schemes, including: Sh94.2 billion from the Development Policy Operations (DPO), Sh52 billion from the Rapid Response Option (RRO), and Sh5 billion from the programme-for-results (PforR) window.

The DPO scheme provides vital budget support tied to institutional and policy reforms. It helps to ease heavy public debt pressures and fiscal deficits by funding governance, accountability, and social protection.

The RRO is a fast-disbursing mechanism which allows enrolled countries to immediately use up to 10percent of their undisbursed project financing balances to address emergency economic shocks such as disruptions caused by surging fuel and fertiliser prices.

PforR financing focuses on fund disbursement directly to the delivery of specific, verifiable program results. It helps countries improve public sector performance, build institutional capacity, and enhance transparency by releasing money only when agreed-upon milestones are met.

Kenya will be required to meet specific socio-economic outcomes to unlock funding under the DPO option, which will cover the final tranche of a three-part series first agreed upon in 2024.

Additionally, the country is obligated to disclose planned emergency spending to access Sh52 billion ($400 million) from the emergency RRO window, even as Kenya is widely expected to use the resources to mitigate the impact of flooding from the expected El Niño-induced rainfall from October this year.

Funding under the RRO is also subject to other legal and regulatory requirements.

‘Notwithstanding the foregoing, the government may also consider other external financing options, subject to the applicable legal, regulatory and policy requirements including the Rapid Response Option,’ the National Treasury said in its annual borrowing plan.

The World Bank has set more than 10 conditions to unlock the next Sh94.2 billion ($725 million) DPO tranche, including the disclosure of the personal interests of public officials and the publication of regulations to restrict unsolicited public-private partnerships deals, such as the flopped proposal by the Adani Group to upgrade the Jomo Kenyatta International Airport.

The World Bank approved the disbursement of Sh97 billion ($750 million) from the second tranche of the DPO at the end of June, after it disbursed Sh155 billion ($1.2 billion) in June 2024.

To secure the next disbursement, Kenya faces a series of demands from the World Bank.

Kenya must enact the proposed Whistleblower Protection Act, which seeks to ensure fair competition, value for money, and improved detection of misused funds.

The adoption of the law is expected to anchor declarations of personal interests by public officials, reviewed and verified by the responsible commissions, from a baseline of zero to 85 percent by 2028.

Kenya is also expected to amend the Companies Act of 2015 to align the beneficial ownership registry with updated Financial Action Task Force (FATF) standards. FATF is an intergovernmental agency that leads global action to tackle money laundering and terrorist financing.

The multilateral also requires changes to the Public Finance Management Act to ensure that any budget adjustments during implementation are strictly aligned with the fiscal aggregates approved by Parliament.

Kenya must also consolidate human resources and payroll data for all ministries, departments and agencies, counties, non-commercial State corporations, commissions and independent offices.

The first set of conditions for the third DPO seeks to improve the efficiency, transparency and equity of public finance, while the second aims to foster competitive and inclusive product and labour markets.

The final set of conditions focuses on strengthening climate action and includes the enactment of the Railways Bill, as well as regulations for the urban transport policy and the e-mobility policy.

Kenya previously requested emergency funding support from the World Bank under the RRO to mitigate the impact of the US war on Iran, but the country failed to detail its spending plans from the disbursement, causing a delay in financing.

The country has since identified the impending El Niño-driven heavy rains and flooding as a key economic risk in 2026 in its pitch for emergency funding from the World Bank.

‘Yes, the government did request the RRO and has gone through the process of signing up for the option. We are currently in the process of figuring out exactly what expenditures the government would like to support during the time of crisis,’ Anne Bakilana, an operations manager at World Bank Kenya, said last month.

‘The vehicle created (to support emergency expenditures) can last up to a year and can finance any emergency that would happen during that period, including health sector emergencies, pandemics and flood emergencies.’

The World Bank is set to remain the key source of external concessional financing over the medium term as Kenya remains in protracted discussions with the IMF for a new funded programme.

Kenya has not budgeted for any new financing from the IMF up to at least June 2030 as it manages expectations of accessing monies from the fund but expects continued access to the World Bank’s DPO facility.

The country is set to continue its push for a new IMF facility shortly as the fund begins to assess the economy’s health under Article IV consultations.