Currently, Kenya’s construction industry is going through boom. The government has invested heavily in the construction sector of Kenya in order to improve the infrastructure such as road networks, and at the same time provide new residencies for the locals (who are being supported by the banks to get loan to buy apartments/cars).
According to the Kenya National Bureau of Statistics, the real estate and construction sectors continues to be some of the key drivers of economic growth in Kenya for the last five years. The Kenyan construction industry contributes 7 percent of the gross domestic product (GDP), which makes it clear that Kenya has a well-developed construction industry. With an increase in population, opportunities exist in the construction of residential, commercial and industrial buildings, including prefabricated low-cost housing.
The economic outlook of the country indicates that the construction industry presents one of the key areas that would, and is, attracting investors to the country.
Extensive opportunities for investment exists particularly in the area of upgrading slums and informal settlements, urban renewal, construction of middle and low income housing, and the manufacture and supply of building materials and components.
Infrastructure development is a central pillar of Kenya’s Vision 2030 and in 2015 the US$3bn construction sector contributed 4.8% to the Kenyan economy. The Economic Survey 2016 published by the Kenyan National Bureau of Statistics (KNBS) reported that approximately 148,000 people are formally employed in the domestic building and construction industry. Players operating in the sector range from indigenous micro-enterprises to foreign multinational civil engineering and construction giants.
Although building and construction contractors are required to be registered with the National Construction Authority (NCA), a significant number of unregistered contractors operate in the informal sector.
Kenya has the highest literacy rate in Africa and the workforce is well known for being educated and hard working. One advantage for foreign investors is that everyone speaks the common language English. This makes it easy for new people to understand and quickly adapt to the new country.Therefore, Kenya serves as a good starting point to begin business in Africa due its positive growing economy, natural reserves & a strong workforce who can easily be communicated with.
A recent study by BMI Research shows that the local construction industry will grow by 8.7 per cent this year and remain steady up until 2026 with an annual growth of 6.2 per cent – which will see Kenya outperforming all Sub-Saharan countries.Kenya’s construction market is poised for significant expansion between 2018 and 2026. Significant support for the sector will stem from the Kenyan budget, backed by foreign investment into the country’s planned infrastructure development.
