The government intends to invest up to KES 20 billion to acquire ownership in manufacturing companies in Kenya. The plan, which will bolster industrialization and revive struggling firms in the manufacturing sector, is set to be conducted through the Kenya Development Corporation (KDC).
KDC is a state-owned Development Finance Institution (DFI) that supports economic growth by investing in key sectors and financing development projects. The corporation has set aside KES 7 billion in the current fiscal year for this purpose.
Speaking at a consultative meeting with business leaders in Nairobi, President William Ruto said that the government is willing to eliminate the risk in investments that are mostly avoided by individuals and businesses by acquiring some stake.
“We should be able to do that, especially on the crucial sectors that may be industry is not comfortable (putting money). We can put in our resources, derisk, and over time, we can walk out when investments are stable,” said President Ruto.
This initiative aligns with President Ruto’s Bottom-up Economic Transformation Agenda (BETA), which seeks to revitalize and grow not only the manufacturing sector, but also agriculture as a foundation for economic growth and development.
According to data from the Kenya National Bureau of Statistics, in 2024, the manufacturing sector grew by 2.8 %, up from 2.2% in 2023. However, its contribution to the Gross Domestic Product (GDP) dropped to 7.3% from 7.5% in 2023. Agro-processing industries registered growth of 9.8 % mainly driven by a rebound in sugar production, which rose by 72.5 %. Its percentage contribution to GDP rose by 1% to 22.5% from 21.5% in 2023. The construction sector fell by 0.7 % in 2024 compared to 3.0 % growth recorded in 2023. Consequently, its contribution to GDP declined by 0.4%, to 6.3% from 6.7% in 2023.
Manufacturing Sector Contribution to GDP
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