FORWARD
Under Vision 2030, Kenya aspires to be a middle income, rapidly industrializing country and globally
competitive by 2030. To achieve this, Kenya’s GDP must grow by US$4-6 billion per year, which is a
growth rate of ~10% per year. We recognise that achieving this growth rate presents a significant
challenge for Kenya, as Kenya’s has grown at closer to 5% per year over the past few years. We are
ready for this challenge.
The manufacturing sector will be a key driver for economic growth and development. Industrial activities
create jobs, increase GDP and contribute to wealth accumulation. As such, Kenya aims to have a robust,
diversified, and competitive manufacturing sector. We have a solid foundation from which we can build,
and we have a clear path ahead for how we can develop the manufacturing sector. In the medium
and long term, the sector will play a critical role in propelling the economy to achieve the 10% growth
rate needed to reach Vision 2030. In addition, the sector will support the country’s social development
agenda through the creation of jobs for the increasing number of youths entering the job market, the
generation of foreign exchange, and by attracting the Foreign Direct Investments.
While Kenya does have some industrial activities, we also face challenges in the sector. The manufacturing
sector’s contribution to Gross Domestic Product (GDP) has stagnated at about 10 per cent in the last few
decades. The growth of the sector has been below the annual target, and Kenya’s exports have remained
predominantly primary commodities with low value addition. We must overcome some challenges to
build momentum in the sector.
During the first Medium Term plan 2008-2012, the Government developed Sessional Paper No. 9 on The
National Industrialization Policy Framework for Kenya 2012-2030 to facilitate the industrial transformation
process. The overall policy objective was to enable the industrial sector to attain and sustain annual
sector growth rate of 15% and make Kenya the most competitive and preferred location for industrial
investment in Africa, leading to high employment levels and wealth creation. The policy aims at providing
strategic direction for sector growth and development by creating an enabling policy environment for
private sector-led industrial development and a business environment capable of attracting local and
foreign investments.
In order to realize the goals of the second Medium Term Plan 2013-2017 of Vision 2030, this plan
has taken on board key policy recommendation of Jubilee Coalition Manifesto. The Plan reflects the
priorities outlined in the Industrialization Roadmap, key cabinet decisions, and the direction provided
by His Excellency the President, Uhuru Kenyatta, CGH.
The Micro, Small and Medium Enterprises (MSMEs) sub-sector is recognised as the foundation of
Kenya’s industrial and enterprise development. The sector has a huge potential to generate the much
needed employment opportunities especially for the youth. However, the potential of the sector has
not been fully realised due to challenges such as limited access to appropriate finance; inadequate
markets; poor infrastructure in certain areas, limited technology uptake, weak management structures,
weak linkages with research institutions, poor product quality especially for SMEs, and lack of access
to skilled labour. Providing affordable, high quality and accessible infrastructure will be key in attracting
more private investments in the industrial sector. SMEs Industrial Parks, Industrial Parks and Special
Economic Zones with requisite infrastructure and social amenities will be developed to provide incentives
to potential investors.
To accomplish this plan, the Ministry will collaborate closely with development partners, County
Governments and private sector to ensure that all of our resources work in concert. One concrete example of our effort in this area is the Public Private Partnerships Policy and Act, which will strengthen
the legal framework for public and private sector to investment in the sector. The PPP policy framework
offers an opportunity for Kenya to attract enhanced private sector participation in financing, building
and operating infrastructure services and facilities including the SEZs, Industrial and Science Parks;
Industrial Clustering and industrial incubations facilities.
The sector plan therefore provides a roadmap for revitalizing the manufacturing sector and making
Kenya the most competitive and preferred location for industrial investment in Africa.
Adan Mohamed, EBS
Cabinet Secretary
Ministry of Industrialization and Enterprise Development