Foreign firms have injected about Sh740 billion into the country over the past five years, according to the Kenya Investment Authority.
The amount reflects to 1,068 projects set up and 154,786 jobs created during the period.
According to Keninvest MD Moses Ikiara the most active investors on a global scale are China and India while in Africa there has been an increase in investment from South Africa, Mauritius and Nigeria
“Other key players are Japan, Malaysia, Singapore, Egypt, Morroco, US and UK,” he said.
In 2017, Foreign Direct Inflows to Kenya were valued at $1.1 billion (about Sh110 billion). This was 45.54 per cent of what firms invested in 2016. During the period, investments from outside Africa declined by about Sh110.51 billion while those from firms based in Africa more than doubled to Sh35.82 billion.
A report released by the African Development Bank on Tuesday highlighted the need for private firms to invest within the continent due to a gradual decline in global FDI.
“The current volatile global environment underscores the importance for Africa to reduce its dependence on extra-continental inflows and to promote intra-regional investment alongside international investment,” the report stated.
Ikiara said although a move to increase investment among African states is highly welcome, private firms in the country are yet to attain the capacity required for domestic inward investment.
“Many African countries are still looking for capital investors outside the continent as the capacity of private companies in the continent is still low,” he said. “It is however a good move for the long-term.”
He added that even as firms in the country expand to other regions, they must first maximise on the opportunities present in Kenya.
The report noted that African states are favouring foreigners over their neighbour states as investment partners adding that this was detrimental to economic growth.
“Across a range of areas, Africans treat non-Africans far better than they treat other Africans,” Comesa secretary general Sindiso Ngweyna was quoted in the report.
He said foreign investors get better incentives and better treatment than national or regional investors.
“Those carrying non-African passports can move more easily in Africa than those carrying African passports, into most of the countries,” said
Ngweyna.
This is evidenced by increased Chinese investment in Africa with Kenya hosting more than 400 Chinese firms. Ikiara refuted these claims stating that partnerships with China were more about policy and impact of investments rather than race.