Investors Finding Their Way Back to the Kenyan Market

After weathering a series of economic challenges over the past few years, Kenya is once again capturing the attention of global investors. With a projected economic growth rate of 5.5% for 2025, the East African nation is demonstrating resilience through a revitalised tourism sector, an agricultural rebound, and a robust stream of remittances bolstering consumer spending.

According to Finnfund economist Tangeni Shatiwa, “Kenya’s improved external position will support investor confidence and strengthen its ability to access international financing.” This confidence was clearly reflected in the country’s recent $1.5 billion Eurobond issuance in February 2025, which garnered strong investor demand.

A Turnaround Story Backed by Data

Just a year ago, Kenya’s external deficit loomed at 4.4% of GDP—a bottleneck in attracting international financing. Fast forward to 2025, and that figure has shrunk to 3.6%, helped along by substantial inflows from bilateral and multilateral lenders. The result? A healthier foreign exchange reserve and, perhaps more importantly, a renewed global interest in Kenya’s market.

Strong US Trade Relations on the Horizon

While shifts in US trade policy are creating ripples across the African continent, Shatiwa believes Kenya is uniquely positioned to weather any potential storms. “Kenya is considered to be one of the US’s key allies in the region,” he explains. With a relatively low reciprocal tariff of 10% on textile exports to the US, Kenya might actually become more competitive than Chinese products in that space.

Sectors Drawing Serious Attention

Finnfund has placed smart bets on Kenya’s ICT sector, which has long been a catalyst for innovation in the region. Noteworthy investments include:

• Twiga Foods – a platform linking smallholder farmers with retailers.
• Kasha Technologies – an e-commerce player revolutionising access to healthcare and household products.
• Kentegra Biotechnology Holdings – empowering smallholder pyrethrum farmers with drought-resistant income sources.

These investments highlight a strategy that’s more about long-term impact than short-term gain—yet both seem to be within reach.

Outperforming the Region

Despite a slowdown to 4.7% growth in 2024, Kenya outpaced the Sub-Saharan African average, underlining the strength of its services-led private sector. This resilience—particularly when many emerging markets are still struggling to recover—is not just noteworthy; it’s actionable for investors.

What’s Next?

As the world recalibrates in a post-COVID, climate-challenged, geopolitically complex era, Kenya’s trajectory signals stability and opportunity. Whether it’s infrastructure, agriculture, or digital innovation, investors finding their way back to the Kenyan market may be met with more than just returns—they might find a stake in Africa’s most forward-looking economic story.

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