Local companies are unleashing multi-billion shilling investments that are set to create new jobs even as foreign firms fret over the March 4 General Election.
Keroche Breweries, East African Breweries Limited (EABL), Kenafric Industries, Coca-Cola, PepsiCo, Telkom Kenya and Essar are some of the companies that have announced investments of between Sh1 billion and Sh2.5 billion in 2013.
This is a departure from the past where foreign firms led the pack by investing heavily in various sectors of the economy.
The local investments come at a time when data from the Kenya Investment Authority (KenInvest) shows that jobs created by foreign direct investments (FDI) had dropped by 60.4 per cent as of September standing at 3,957 employees as of September compared to 10,017 recorded last year.
This drop came as FDI fell to Sh51.2 billion from Sh102.7 billion last year in what was linked to a weak global economy and heightened political risks in Kenya ahead of March 4 elections.
“This trend is expected as we near elections since foreigners are more cautious to see the outcome of the election and what policies the new government has towards foreign investors,” said Samuel Nyandemo, an economist who lectures at the University of Nairobi.
“Uncertainty is not exclusive to foreigners alone since the amount of local based investments would be higher in other years not preceding elections.”
One of the driving forces behind these investments, competition, has seen companies announce counter plans to those of their peers as they rush to grow their respective businesses and protect their market share.
PepsiCo, for instance, made a comeback into the Kenyan market after its 2010 exit with construction of a Sh2.4 billion plant being built in Nairobi.