It is a reprieve for global tech giants like Amazon and the telecommunications company Airtel following the deletion of the regulation requiring foreign-owned Information and Communications Technology (ICT) companies operating in Kenya to sell at least 30% of their ownership stake to local investors. This comes after the ICT Ministry announced on Tuesday, 11th July, that, as Kenya visioned to be globally competitive in terms of knowledge-based economies, it was right for the government to strategize for the promotion and development of the ICT sector to encourage investments, both by foreign and local investors, thus creating employment opportunities for Kenyans.
Read more: Kenya Lags Behind Among Her Peers in the Foreign Direct Investment (FDI) Race
The Kenyan government introduced local ownership provision regulations in the ICT sector back in 2020, requiring compulsory 30% local ownership in a bid to support healthy competition in ICT. However, President Ruto came out in March to say that the regulation had acted as a limiting factor that had discouraged giant tech companies like Amazon, Google, and Microsoft from setting up in Kenya. The president then insinuated an oncoming deletion of the said regulation. Airtel Kenya has also been working to fulfil the said regulation by the earlier set deadline of March 2024. The lifting of the regulation is definitely a reprieve for the telecommunications company operating in Kenya.
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This comes as the Kenyan government continues to strategize on ways to attract more Foreign Direct Investment (FDI) into the country. Kenya recorded an increase in FDI of 63.9% in 2022 compared to 2021, which is attributed to the increased interest in Kenya’s renewable energy sector by foreign investors. Despite the huge jump in growth, Kenya still trailed behind her peers like Ethiopia, Uganda, and Tanzania in its ability to attract foreign investors.
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