The government plans to use Special Economic Zones to attract foreign investment worth Sh1.48 trillion annually.
Principal Secretary for Investment Abubakar Hassan said so far 28 SEZs have been gazetted across the country to tap foreign direct investment.
The PS spoke when he officially launched the Nairobi Gate Industrial Park’s first Special Economic Zone along the Eastern Bypass on the border of Nairobi and Kiambu counties.
“Out of the 28 SEZs, seven are already gazetted as custom controlled and three of them, including the Nairobi Gate, are operational. Four of them are publicly developed and 24 are private,” Abubakar said.
He also divulged that in the Finance Act 2023, the government has removed withholding tax on dividends and interest that was previously charged on investors.
The PS commended the Nairobi Gate investors noting that they have pumped in $40 million into the project in the last one-and-a-half years, and are set to spend $160 million more in the next five years to complete the industrial zone.
“So far 500 jobs have been created, and by the time the SEZ is completed, there will be 10,000 direct jobs, which will have a huge impact on the country’s economy,” he said.
The SEZ, which has a gazetted customs control area in East Africa, is expected to allow businesses operating from Nairobi Gate additional efficiencies including a one-stop shop for regulatory agencies, including the Kenya Revenue Authority, Kenya Ports Authority, customs, and the Special Economic Zones Authority.
The PS underscored the importance of industrial parks in driving investment within the country, in addition to accelerating manufacturing and promoting skills exchange, noting that the industrial park has already created 434 direct and indirect jobs, and is expected to generate at least 10,000 job opportunities as it progresses.
“This inauguration is in alignment with the Kenyan government’s vision and commitment to developing and implementing investment policies, and to coordinate the promotion of private investment into the Kenyan economy, including both foreign and domestic investment. It signals to us, and to the world at large, that Kenya remains an attractive investment destination,” the PS said.
Developed by Improvon Group, Nairobi Gate SEZ was meticulously designed to align with the East African Community Customs Management Act requirements, including housing all relevant government agencies within the zone.
So far, the developers of the Nairobi Gate Industrial Park have invested $40 million with a commitment to invest up to US $160 million by the year 2035.
Dean Shillaw, managing director of Impact North SEZ, owner of Nairobi Gate Industrial Park, explained that the SEZ will provide additional value for businesses, stating that:
“Because the Special Economic Zone is effectively an extension of Kenya’s border for imports and exports, a one-stop solution had to be provided to house all relevant government agencies. This allows us to provide unprecedented levels of ease for our tenants while allowing them to thrive within a well-planned industrial park. In addition to the warehousing and infrastructure, we have also installed multiple state-of-the-art weigh bridges, customs-controlled gatehouses and other security measures that will allow the zone to operate as a fully functional and comprisable area.”
Dr Kenneth Chelule, CEO of the Special Economic Zones Authority, emphasised the significance of Nairobi Gate, as it marks the first SEZ to fully integrate customs control provisions within the zone, following recent legislative developments.
“As SEZA, we believe that the Nairobi Gate Industrial Park represents the flagship SEZ that will unlock significant economic growth opportunities and create multiple jobs. This will position Kenya to compete not only regionally but on the international stage, as a manufacturing destination of choice,” said Dr Chelule.
Strategically aligned with Nairobi’s 2030 spatial development plan, Nairobi Gate offers turnkey projects, ranging from mini units of 5,000 square feet to warehouses of 400,000 square feet, along with land sale options.
The government has packaged SEZs to boost local manufacturing and create jobs.