Ease of Doing Business Rank: 56
The Republic of Kenya is an east African country on the Indian Ocean. Ethiopia and South Sudan lie to the north, Uganda to the east, Rwanda, Burundi, and Tanzania to the south and Somalia lies to the east.
The official languages of Kenya are English and Bantu Swahili. English is widely spoken in commerce, schooling and government and approximately 16 percent of the population has some competence in English.
Swahili is the first language in many coastal areas and a second language for about three-quarters of Kenyans. Minority languages include Afro-asiatic, Indo-European and Germanic dialects.
The 2019 population estimate is 52.57 million.
The largest city in Kenya is Nairobi (4,394,073), followed by Mombasa (1,208,333) and Kisumu (750,000). All other cities and towns have populations of less than 500,000.
The top industries in Kenya are agriculture, forestry, fishing, mining, manufacturing, energy, tourism and financial services.
The Legatum Prosperity Index ranks Kenya’ education system 105th out of 149 nations.
The most common type of business entities in Kenya are Limited Liability Company, Limited Liability Partnership and Public Limited Company.
The overwhelming majority of businesses are in the form of a Limited Liability Company.
Kenya only offers a foreign tax credit for businesses operating in countries with a Double Tax Treaty. However, companies can deduct foreign tax paid as an expense.
The country also provides a 150% investment deduction providing the investment exceeds KES 200 million and excludes the areas of Nairobi, Mombasa and Kisumu. Investments that fall outside these parameters may qualify for a 100% investment deduction during the year used.
Kenya also offers export processing zones which are exempt from corporate tax for the initial 10 years and 25% for the following 10 years. Licensed special economic zone enterprises, operators, and developers are exempt from stamp duty.
Companies listed on the Nairobi Securities Exchange are entitled to reduced income tax rates for prescribed periods, depending on the percentage of share capital listed.
Nairobi is the financial center of Kenya. Mombasa is the only international seaport in Kenya and the largest port in east Africa.
Kenya is best known for its more than 40 national parks and wildlife reserves. Some are designated UNESCO World Heritage Sites due to their unique flora and fauna.
The Great Rift Valley features three lakes and countless bird species, including 13 on the threatened species list. Lake Turkana National Parks includes Africa’s largest saline lake, Nile crocodile, hippopotamus and more. Amboseli National Park’s elephants are the star attraction as well as Mount Kilimanjaro, the highest peak in Africa. Nairobi National Park has the world’s densest concentration of black rhinos as well as lions, hyenas, gazelles, warthogs, zebras, giraffes, ostriches and buffalo.
Lamu Island is a cultural UNESCO site. It is Kenya’s oldest continually inhabited settlement dating back to the 12th century. It demonstrates the country’s rich trading history and Arab, European, Indian and Swahili influences.
Nairobi is Kenya’s capital and a large, thriving metropolis. It includes many colonial buildings such as Karen Blixen, Kipande House, and Lord Egerton Castle. The outstanding Nairobi National Museum includes a snake park and botanical gardens.
Mombasa is a culturally diverse tourism center due to its 480 km coral reef, spectacular sandy beaches, golf, tennis, snorkeling, squash, diving, fishing and other sports.
Fort Jesus lies just outside of Mombasa. It was built in the 16th century by the Portuguese to protect their trading interests on the Indian Ocean. However, Portuguese power waned. Between 1631 and 1895 it changed hands nine times. It eventually came under British control.
Around 2000 BC, people from northern Africa settled in the area. By the 1st century AD, Arab and Persian traders established colonies to access the Arabian Peninsula. Simultaneously, peoples from the Nile and Nigeria/Chad regions (Bantu) settled inland.
Eventually, Arabic and Bantu languages blended to become Swahili, the language used in trade. Portuguese arrived in 1498 and usurped Arab power on the coast. This region was an important stop for Portuguese ships bound for the Far East.
In the 1600s, the sultanate of Oman gained control of Swahili economic centers, including Mombasa. It became an important state under Omani rule in the eighteenth century through trade, improved agriculture and slavery.
Arab governance of all the major ports along the East African coast continued until Britain began to put pressure on Omani rule. However, other European nations were interested in the area too as Africa had an abundance of valuable resources.
In 1885, fourteen countries sent representatives to attend the Berlin Conference to determine the fate of East Africa. Britain took Kenya and founded the East African Protectorate and invited white settlers shortly thereafter.
By 1920, Kenya was a British Crown Colony and settlers had a voice in government. However, Africans and Asians could not participate, which eventually led to a struggle for national sovereignty during the 1940s and 1950s and rebellion.
African participation in the political process increased rapidly at this time. By 1954, Europeans, Asians and Africans all had representation in the Kenyan legislative council.
Kenya gained independence in 1963 and became the Republic of Kenya the following year.
In 1966 and 1982, the country was officially declared a one party state. However, Parliament annulled the one party section of the constitution in 1991, and by 1997 reforms expanded political rights. Nonetheless, the 2007 elections led to violence.
Eventually, leaders signed the National Accord and Reconciliation Agreement which restored peace, included top-down changes to governmental structure, constitutional reform and three truth and reconciliation bodies.
Today, Kenya is a stable nation which operates as a presidential representative democratic republic. The country has a market-based economy.
According to the 2014 census, most Kenyans identify as Kikuyu (17.2%), followed by Luhya (13.8%), Kalejin (12.9%), Luo (10.5%), Kamba (10.1%), Somali (6.2%), Kisii (5.7%), Mijikenda (5.1%), Meru (4.3%), Turkana (2.6%), Masai (2.2%) or other ethnicities (9.4%).
The majority of Kenyans identify as Christian (84.8%), followed by Islam (11.1%) and other faiths.
According to Forbes’ 2019 Best Countries for Business, Kenya is the 93rd best country in the world for conducting business.
The 2019 Index of Economic Freedom rates Kenya 130th globally and states, “…economic and development trajectory is impaired by weak governance, ineffective rule of law, and corruption.”
World Bank’s “Doing Business” rankings rate Kenya 56th for ease of doing business in the world.