Investment Environment

Overall ease of doing business:

The 2016 World Bank Index of Ease of Doing Business ranks Kenya as the 108th out of a possible 189 economies[1]. Kenya has the strongest investment climate in the EAC, with the foreign direct investment (FDI) flowing in from emerging and developed markets and a high volume of multinational companies with regional and continent-wide headquartered in the country. Kenya has long recognized the benefits of inward investments and has welcomed overseas-owned companies looking to do business in and out of Kenya. Thus, the application for and issuance of the Investment Certificate is free of charge. Generally, it only takes around 1-3 working days to issue the Investment Certificate.

However, investments on health need longer time because they must be cleared by the respective authorities. An investor is free to choose to operate their business with either 100% ownership or in partnership with local investors.

Investment Incentives:

    1)  Policy: Kenya has BITs such as Investment Promotion and Protection Agreements (IPPAs) and Double Taxations Agreements (DTAs) with a growing number of countries to facilitate trade and investment.

    2)  Finance: The depreciation rates are liberal in Kenya.

    3)  Tax: Kenya has duty and VAT remission on raw material imports for export production. The loss-carry forward period is 10 years. Capital goods and basic raw materials are zero-rated. And 25% corporate tax for companies issuing initial public offers in the Nairobi Securities Exchange (NSE). Computers are duty free.

    4)  Export processing zones programme: For this programme, Kenya 100% allows investment and only need single license. The companies will enjoy 10 year tax holiday from all forms of income tax (corporate tax, withholding tax and stamp duty), then after the initial 10-year period, they will enjoy 25% corporate tax for another 10 years. There will also be duty and VAT exemptions on machinery, raw material and equipment.

[1] http://www.doingbusiness.org/data/exploreeconomies/kenya