The retail sector is expected to expand substantially as Kenya’s economy moves towards a 10% growth target by 2012. Kenya has a vibrant retail sector though most business is conducted informally in open air markets.
Investment opportunities
1. Construction of 10 wholesale markets in major towns
Project sites: Nairobi, Mombasa, Kisumu, Eldoret, Nakuru, Embu and Nyeri
Aim of project: To construct fully equipped integrated mega producer wholesale markets and encourage large scale agricultural producer groups around the major towns.
Estimated cost: KSh. 5 billion
Duration of project: To be completed by 2013
Expected outcome: To provide an avenue for product consolidation, infrastructure for easier market access, improved facilities, and revamped supply chain from small scale producers to retail markets.
2. Retail market pilot project
Proposed activity: Build a pilot retail market in Athi River, located 20 kilometres from the capital Nairobi.
Expected outcome: Tier 1 retail market which will
be a model for 10 other retail markets.
Estimated cost: Ksh. 400 million
Duration of project: To be completed by 2013
Promoter's expectation: On completion, the project would provide the link to the 28 wholesalers as well as a sanitary environment for consumers, and be a retailing model to be replicated countrywide.
3. Other opportunities:
• Establishment of public private partnership to promote infrastructure development through Build Operate Transfer (B.O.T), Build Own Operate and Transfer (B.O.O.T), and Build Own and Operate (B.O.O).
• Constructing wholesale and distribution hubs/malls in cities, municipalities and major towns.
• Establishment of an export development fund and
guarantee scheme to cover risks faced by exporters, and facilitate export market development. (PPP)
• Establishment of product development and adaptation centre to facilitate graduation to higher value added activities. (PPP)
• Investment opportunities in export houses to facilitate exporters to showcase Kenya's products in new markets. (PPP)
• Establish exhibition centres and warehouses in priority markets such as COMESA and Asian markets to increase visibility of Kenya’s products. (PPP)
• Establishment of a free trade port in Mombasa
• Business Process Outsourcing (BPO) park
• Business linkages and subcontracting programme source
Sector overview: Kenya's trade sector comprises formal and informal wholesale and retail trade, distribution, international trade, trade in services and electronic trade.
The sector has shown a growth trend in its contribution to the gross domestic product (GDP) due to increased trade, particularly within the East African Community (EAC) and the Common Markets of Eastern and Southern Africa (COMESA). The retail sector is one of the areas identified for rapid growth and development under the government's economic blue print, Vision 2030. The sector however faces weaknesses that hinder products from competing in the international markets. To address these shortcomings, the government plans, in collaboration with the private sector, to implement programs aimed at addressing the problems.
For further information about the opportunities in the retail sector and available incentives contact the Kenya Investment Authority.
Key contact: Susan Kikwai - Managing Director
Email: info@investmentkenya.com
Website: www.investmentkenya.com
