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24 March, 2024

Foreign Direct Investments (FDIs) refer to investments made by a firm or individual in one country into business interests located in another country. Generally, FDI takes place when an investor establishes foreign business operations or acquires foreign business assets, including establishing ownership or controlling interest in a foreign company. FDIs are crucial for economic growth as they not only bring investment capital but also facilitate technology transfer, management skills, and international trade integration, which can lead to higher productivity, employment, and economic stability in the host country.

Despite the increase in Kenya’s FDI to USD 0.8 bn in 2022, from USD 0.5 bn in 2021, the country has been experiencing dwindling FDIs amongst her peers, hence our interest into delving in this topical. We shall do an in-depth analysis of the historical trend of FDIs in the country, compare it to other developed and peer economies, as well as give actionable initiatives to improve FDIs into the country. We shall cover the following:

  1. Overview of Foreign Direct Investments in Kenya,
  2. Economic Benefits of FDIs and Challenges to FDI Growth in Kenya,
  3. Recommendations, and,
  4. Conclusion and our Outlook.

Disclaimer: The views expressed in this publication are those of the writers where particulars are not warranted. This publication, which is in compliance with Section 2 of the Capital Markets Authority Act Cap 485A, is meant for general information only and is not a warranty, representation, advice or solicitation of any nature. Readers are advised in all circumstances to seek the advice of a registered investment advisor.