Kenya has an emerging market and is an averagely industrialised nation ahead of its East African peers. Currently a lower middle income nation, Kenya plans to be a newly industrialised nation by 2030. The major industries driving the Kenyan economy include financial services, agriculture, real estate, manufacturing, logistics, tourism, retail and energy. As of 2020, Kenya had the third largest economy in Sub-Saharan Africa, behind Nigeria and South Africa.
The government of Kenya is generally investment-friendly and has enacted several regulatory reforms to simplify foreign and local investment, including the creation of an export processing zone. As of September 2018, economic prospects were positive, with above 6% gross domestic product (GDP) growth expected. This growth was attributed largely to expansions in the telecommunications, transport, and construction sectors; a recovery in agriculture; and the rise of small businesses helping to pull the economy. These improvements are supported by a large pool of highly educated professional workers.
Kenya gained its independence in 1963. Under President Jomo Kenyatta, the Kenyan government promoted africanisation of the Kenyan economy, generating rapid economic growth through public investment, encouragement of smallholder agricultural production, and incentives for private, often foreign, industrial investments.
From 1991 to 1993, Kenya had its worst economic performance since independence. Growth in GDP stagnated, and agricultural production shrank at an annual rate of 3.9%. In 1993, the Kenyan government began a major programme of economic reform and liberalisation.
Economic growth improved between 2003 and 2008, under the Mwai Kibaki administration. When Kibaki took power in 2003, he immediately established the National Debt Management Department at the treasury, reformed the Kenya Revenue Authority (KRA) to increase government revenue, reformed financial laws on banking, wrote off the debts of strategic public enterprises, and ensured that 30% of government tax revenue was invested in economic development projects. With these reforms, driven by the National Rainbow Coalition government, the KRA collected more tax revenue in 2004 than was anticipated. The government then initiated investments in infrastructure. By 2005, the Kenyan public debt had reduced from highs of 80% of GDP in 2002 to 27% of GDP in 2005.
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Vision 2030 is Kenya's current blueprint for its economic future, with the goal of creating a prosperous, globally-competitive nation with a high quality of life by 2030. Vision 2030 seeks economic growth averaging greater than 10% for 23 years, beginning in the year 2007.
In April 2025, Kenya secured $600 million in short-term financing from commercial banks to support road construction projects, amid persistent budgetary pressures stemming from sluggish tax revenue growth, high debt servicing costs, and increased spending obligations, including at the county level. Separately, Kenya plans to issue Africa’s first sustainability-linked bond by November 2025, targeting $500 million to support the national budget and contribute to environmental, social, and energy-related goals.
The Kenya Economic Stimulus Programme was introduced in the 2010-2011 budget plan. The initiative aimed to stimulate economic activity in Kenya through investment in long-term solutions to food insecurity, rural unemployment, and underdevelopment. Business loans in Kenya were a key component of this strategy, providing much-needed financial support to small and medium enterprises (SMEs) to drive growth and innovation.
Kenya is active within regional trade blocs such as the Common Market for Eastern and Southern Africa and the East African Community, a partnership of Kenya, Uganda, Tanzania, Rwanda, Burundi and South Sudan. Kenyan policies on foreign investment generally have been favourable since independence, with occasional tightening of restrictions to promote the africanisation of enterprises. Kenya is currently the most important source of foreign direct investments in Uganda and Rwanda.
Entrepreneurship Among Kenyan Youth
According to the NCPD, youth, who form 35% of the Kenyan population, have the highest unemployment rate of 67%. To better understand the perspectives of Kenya’s youth on employment and entrepreneurship, GeoPoll conducted a survey capturing insights into their aspirations, challenges, and perceived opportunities. The survey gathered feedback from a varied group of young people in Kenya. The participants ranged from 18-35 years old, with the largest share being between 25-35 years old (64%), and comprised 63% male and 37% female.
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When asked about their present household income, the largest group, at 44%, makes less than Kes. 30,000. This is followed by 20% who earn between Kes. 30,000 and Kes. 50,000, and then 17% who have an income ranging from Kes. 50,000 to Kes. 80,000. Only 6% said they earn over Kes.
The findings revealed a mixed picture: 38% of respondents identified as unemployed, highlighting the ongoing struggle for stable job opportunities. Among those surveyed, 19% identified themselves as working in the Information and Communications Technology (ICT) sector, making it the largest group. Kenya is renowned for technology leadership across the continent. The agribusiness sector accounted for 14% of employment. Additionally, another 14% of respondents reported being involved in the sale of goods and services, particularly within the supermarket industry. The hotel and tourism sector comprised 12% of the workforce, while 8% were employed in both finance and insurance. The manufacturing sector employed 7% of workers, and transportation accounted for 5% of employment.
Despite the variations in employment status, the majority of respondents (71 %) reported having side hustles-small-scale entrepreneurial activities that supplement their income.
Among the individuals identified as unemployed, which constitutes 37% of the surveyed population, a significant 91% are actively seeking employment. Within this group, 33% have reported that their job search has extended over the past two years. An additional 26% have been searching for more than one year but less than two years, while 24% have been in pursuit of employment for a duration of six months to one year.
When asked about some of the challenges they faced as being unemployed, a staggering 80% of respondents cited a lack of job opportunities as the primary hurdle. Additionally, 42% pointed to the pervasive issue of nepotism and cronysm, expressing frustration over the necessity of personal connections to secure employment. Insufficient networking opportunities were highlighted by 39% of participants, while 34% underscored inadequate support from government and institutions as a barrier. Other significant challenges include lack of work experience (32%), limited access to career guidance (17%), and skills mismatches (17%).
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The survey revealed a strong entrepreneurial spirit among Kenyan youth, with an overwhelming 87% expressing interest in starting their own businesses. Furthermore, the survey found that 56% of respondents prefer running their businesses full-time, while 39% expressed interest in pursuing entrepreneurship on a part-time basis. When it comes to sectors of interest, retail and trade emerged as the most desired field, attracting 33% of the respondents. Agriculture followed closely with 27%, reflecting the sector’s longstanding significance in Kenya’s economy. Technology ranked third at 21%, highlighting the growing appeal of innovation and digital solutions among the youth.
Starting a business in Kenya presents several challenges for youth. A significant 72% of respondents cited lack of access to capital as the primary obstacle, limiting their ability to realize their ideas. Furthermore, 6% identified a lack of business knowledge and skills, pointing to deficiencies in education and training. Also, 6% expressed uncertainty about starting their ventures, whether due to unclear business ideas or being overwhelmed by too many options.
A significant portion of the youth in Kenya (60%) holds the belief that ample opportunities exist for young individuals interested in entrepreneurship. However, 33% of the respondents express the contrary view, indicating that they believe there are insufficient opportunities available.
Financial support (grants and loans) (82%) - is the most sought-after form of assistance for aspiring young entrepreneurs, with 82% of respondents identifying it as crucial to starting their businesses. This highlights the significant role of access to capital in empowering youth to overcome financial barriers and kickstart their ventures. Skill training programs (51%) - The survey further revealed that skill training programs are a key need for young entrepreneurs, with 51% of respondents highlighting their importance. Government Policies and incentives (45%) - 45% of respondents identified Government policies and incentives as an important factor in starting a business. Networking events (39%) - Networking events were recognized as an essential support mechanism, with 39% of respondents emphasizing their importance.
The survey revealed that 54% of respondents have engaged in entrepreneurial or business training programs offered by either governmental or non-governmental organizations. Among those who participated, 34% reported that these programs moderately enhanced their entrepreneurial and business skills. Additionally, 29% noted a slight improvement, while 26% experienced a significant enhancement in their skills.
This Exclusive Survey was run via the GeoPoll mobile application between the 10th and 15th of November 2024 in Kenya. The sample size was 749, composed of random app users between 18 and 35.
Key Challenges Faced by Unemployed Youth
- Lack of job opportunities (80%)
- Nepotism and cronyism (42%)
- Insufficient networking opportunities (39%)
- Inadequate support from government and institutions (34%)
- Lack of work experience (32%)
- Limited access to career guidance (17%)
- Skills mismatches (17%)
Africa's Rising Stars: Youth Entrepreneurship in the Face of Challenges and Opportunities
Women in Entrepreneurship
Nairobi, Kenya | 5 March 2025: Kenyan women are embracing entrepreneurship at an extraordinary rate, with nine in ten (93%) women considering starting or running their own business-far higher than the regional average of 51% who likely to consider themselves entrepreneurs across Eastern Europe, Middle East, and Africa (EEMEA). New research from Mastercard, released ahead of International Women’s Day 2025, highlights the driving forces behind this wave of entrepreneurship: financial independence, flexible working hours, and the pursuit of personal dreams.
“The entrepreneurial spirit among women is strong and growing, with younger generations leading the way. With access to the right financial tools, mentorship, and digital resources, women entrepreneurs can unlock new business opportunities, drive innovation, and contribute significantly to economic development.
Older generations (Baby Boomers 93%, Gen X 90%) in Kenya are slightly more likely to consider themselves entrepreneurs than younger generations (Gen Z 85%, millennial 89%). Nearly all (96%) Gen X women have considered starting a business, significantly higher than Gen X women across EEMEA (71%).
Shehryar Ali, Senior Vice President and Country Manager for East Africa and Indian Ocean Islands at Mastercard shared, “This research highlights the remarkable entrepreneurial drive among Kenyan women, who are redefining business growth and innovation in the country. Their resilience and determination are shaping Kenya’s economic landscape, but the challenges they face cannot be ignored.
The lack of funding (53%) remains the biggest challenge, followed by lack of financial resources (44%) and the difficulty in securing startup capital (34%). Among women who have already started a business, 63% say finding initial funding was their biggest challenge. Many women also struggle with building sustainable businesses, with nearly half (47%) unsure of how to scale, a figure significantly higher than the EEMEA average of 31%. Four in 10 (41%) also lack the know-how to develop a business plan. However, 57% of business owners remain cautious about expansion due to the rising risk of fraud, with 58% having been targeted by a fraudster, underlining the need for robust cybersecurity education and protection.
Mastercard has a long-standing commitment to enabling women entrepreneurs through financial inclusion, digital solutions, and knowledge-sharing initiatives.
Ease of Doing Business
Kenya is ranked 56 among 190 economies in the ease of doing business, according to the latest World Bank annual ratings. The rank of Kenya improved to 56 in 2019 from 61 in 2018. Ease of Doing Business in Kenya averaged 98.00 from 2008 until 2019, reaching an all time high of 129.00 in 2013 and a record low of 56.00 in 2019. The Ease of doing business index ranks countries against each other based on how the regulatory environment is conducive to business operationstronger protections of property rights.
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