NAIROBI, Kenya, Feb 5 – The growth of the Kenyan economy will be driven by small and Medium Enterprises.
Speaking to Investors in Nairobi at the Entrepreneurs Summit, Entrepreneurs Society of America Chairman Karl Gibbons says though blue chip companies are still attracted to Kenya, only small business will grow the economy.
He urged the government to continue investing in ease of doing business especially for small business in a bid to generate growth.
“The Kenyan economy will be driven by the guy or the girl who starts their own business, will probably never do a million dollars a year and will have less than five employees and they will be 80 percent of the economy,” he said.
About 46 percent of SMEs in Kenya close shop within a year of founding, while another 15 percent in the subsequent year according to the Central Bank of Kenya that cites SMEs failure to solve big enough problems in the market.
According to Deloitte Kenya Economic Outlook 2016 report, Kenyan SMEs are hindered by inadequate capital, limited market access, deprived and unsupportive infrastructure, inadequate knowledge and skills and rapid changes in technology. Besides, corruption and an unfavorable regulatory environment creep in to add more disharmony to the sector.
“Kenya should focus on creating a good environment for small businesses to thrive, some of these small businesses could end up being big corporations,” he said.
He added that America investors are keen on investing in Africa.
“Africa is growing enormously; many American investors are keen on investing here,” he added.
Gibbons will also be speaking to entrepreneurs on Wednesday in Mombasa at an event organized by Sprinter Real Estate Limited.