KENYA- A report by the Business Insider Africa and the East African has revealed businesses from the East African Community (EAC) are increasingly investing in the Kenya’s agriculture, energy, construction, manufacturing and service sectors, placing pressure on local businesses.
According to the report, heavy pursed investors and companies from Tanzania, Uganda, Rwanda, and Somalia have continued to expand their footprint in Kenya as they seek to leverage the potential of the East African giant.
This increased interest in the Kenyan market reflects a changing tide in trade dynamics in the East African region, where Kenyan firms expanded into other EAC countries to leverage existing opportunities.
In the week ended July 19, Tanzanian conglomerate Amsons Group announced the formal takeover of Kenyan construction giant Bamburi Cement in a move valued at KES 24 billion (US$183m), the latest show of interest in Kenya.
Amsons’ entry into the Kenyan market comes barely three months after Uganda’s largest dairy processing company, Pearl Dairy Farms, received approval from regulators to acquire a Kenyan dairy farm for an undisclosed amount.
The move was the company’s attempt at maneuvering through hurdles caused by trade disputes between Kenya and Uganda over the past few months. The Ugandan milk company revealed the move will help enhance its access to the Kenyan market.
Pearl also signed a deal with Kenya Development Corporation (KDC), the state-owned financier in a move that signals more deals and further penetration in the Kenyan market.
In March, the Comesa Competition Commission approved the 100% acquisition of Kenyan-based Highland Creamers & Food Limited by Maziwa, a non-operating holding company based in Mauritius.
Taifa Gas Investment, the Tanzanian energy giant also recently announced the construction of a 30,000 ton LPG import and storage terminal in Kenya’s coastal city of Mombasa. Other EAC-based companies like Premier Bank, Liptons Tea and Yego Global have also announced entry into the Kenyan market.
The change in trade dynamics is influenced by robust growth of kenya’s economy compared to other East African countries.
According to the World bank, Kenya’s economy grew by 5.2% in 2023 and is predicted to grow by an average of 5.8% in 2024-2026 while the combined EAC GDP growth was 2.2% in 2023 and is predicted to grow by an average of 3.2% in 2024-2026.
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