Special Economic Zones (SEZs) in the country have creating over 7,000 direct jobs, including 3,000 jobs in the past 12 months alone, government now says.
The zones have also contributed approximately Sh91 billion to Kenya’s Gross Domestic Product (GDP), demonstrating the critical role SEZs play in the country’s economic development.
The performance is largely attributed to the incentives provided to investors by the government, which has created a conducive environment for growth and development within these zones.
The government’s initiatives are designed to maximise the potential of SEZs, further driving employment and economic output.
Speaking at the opening of the 9th African Special Economic Zone Organisation (AEZO) Annual Meeting in Nairobi, State Department of Industry Principal Secretary Juma Mukhwana emphasised the government’s commitment to ensuring SEZs achieve their full potential.
“We are working around the clock to ensure that Special Economic Zones succeed in this country, with the help of the Special Economic Zones Authority. We understand the immense potential these economic zones hold for job creation and the contribution to Kenya’s revenue and GDP,” Mukhwana said.
The Annual Meeting, which gathers SEZs from across the African continent, serves as a platform to exchange success stories, identify challenges, and promote greater collaboration among African countries.
One key discussion point at this year’s meeting was the harmonisation of operations across borders.
Mukhwana also highlighted Kenya’s leadership on issues such as minimum wage standards, urging other African nations to align their minimum wage policies to create a more competitive environment for investment.
“Kenya has been ahead of many African countries in setting minimum wage standards.While this is an achievement, it sometimes positions Kenya as a more expensive investment destination. We encourage other African countries to also set minimum wage benchmarks to ensure a level playing field for all,” he said.
There are 39 SEZs in the country where nine are public while 30 are private.
Among recent zones include Mombasa SEZ (Dongo Kundu), Lamu SEZ and Naivasha SEZ all which are under development and part of the Kenya vision 2030.
Special Economic Zones play a pivotal role in supporting small and medium-sized enterprises (SMEs), enabling them to integrate into global value chains.
Some of the incentives Kenya is extending to investors in these zones includes full exemption on Value Added Tax, excise duty, import duty and Import Declaration Fee for SEZ development.
Local supplies for the projects are also zero rated with investors also getting preferential rates on corporate tax, which includes 10 per cent for the first 10 years, 15 per cent for the following 10 years and there after 30 per cent for the subsequent years.
Investors are also entitled to preferential withholding tax, exemption on stamp duty and 100 per cent allowance on capital expenditure on buildings and machinery.
Local government fees including advertising and business permit fees are also exempt, with the Kenyan Investment Authority tasked with facilitating investors.
Meanwhile with a growing emphasis on environmental sustainability, SEZs in Kenya are adopting green practices, including clean energy initiatives, waste management innovations, and circular economy models, positioning Kenya as a leader in sustainable industrialisation on the African continent.
The Special Economic Zones Authority (SEZA) is focused on making
Kenya’s SEZs an example of sustainable industrialisation, responding to
the global shift toward environmentally responsible practices.
