Kenya has ring-fenced a fraction of the more than Sh5 billion collected annually from the tourism levy to partly repay private investors in hotels and commercial facilities for the ongoing development of Bomas International Convention Complex (BICC).
The Tourism Fund has committed at least 4 percent of the collections to service long-term repayments to investors participating in the hospitality and commercial components of the project, designed to reposition Nairobi as a competitive regional conferencing hub.
The Tourism levy is set at the rate of 2 percent of the gross receipts derived from the monthly sale of food, drinks, accommodation and all other services in all regulated hotels, restaurants and other tourism activities.
In June 2025, Bomas of Kenya invited private investors to bid for the construction of two five- and four-star hotels and a shopping mall within the expansive 79-acre complex located on the edge of the Lang’ata area in Nairobi, under a public-private partnership programme.
Bomas of Kenya said that each of the hotels will occupy three acres of land, while the shopping mall will occupy a nine-acre plot and would form part of the BICC, which is set to cost more than Sh30 billion.
The projects are structured on a “plan, design, finance, construct, operate and transfer” basis, with investors expected to mobilise capital and operate the facilities..
The Tourism Fund says the ring-fenced levy revenues will form part of the repayment pool for these investors, improving bankability and attracting financing by pension funds and lenders.
Tourism Fund Board of Trustees chairperson Samson Some said the structure allows the sector to mobilise private capital quickly, while avoiding delays associated with traditional public funding.
“It’s a market transaction,” he said in an interview. “Private investors put in money, and the sector commits a percentage of levy collections annually to repay that investment.”
The Tourism levy collections grew to Sh5.1 billion in the year ended June 2025 from Sh4.9 billion collected in the year before and Sh3.9 billion in the year ended June 2023. This means commitments to investors in BICC will be in the upwards of Sh200 million.
Mr Some said committing the levy collections annually spreads repayment costs over time while delivering infrastructure faster than conventional public financing [exchequer or debts], which would have delayed the BICC project by up to 15 years due to fiscal constraints and public debt pressures.
Although Kenya remains competitive in wildlife and coastal tourism, the absence of large, purpose-built conference facilities has cost the country high-value business travellers, allowing regional competitors such as Rwanda to dominate the African conference circuit.
“Kigali has done very well in MICE [meetings, incentives, conferences and exhibitions] and they beat us to it,” Mr Some. “This is not the time for Kenya to compete at a Division Two level. We want to compete at the Premier League level in this region.”
The BICC project aims to close that gap by combining conference infrastructure with supporting hospitality and commercial developments at the Bomas of Kenya site in Nairobi.
The project is being implemented in phases, beginning with the construction of an 11,000-seater convention centre, which also comprises an auditorium and a ballroom.
The first phase is being funded by the government through a proposed off-budget loan from the African Export-Import Bank (Afreximbank), estimated at Sh31.5 billion.
The government has paid 10 percent of the project cost to the main contractor, China Road and Bridge Corporation, with the balance to be disbursed in phases.
Construction of the first phase is more than 60 percent complete, with the main convention facility expected to be ready for use by June next year.
The second phase focuses on hospitality and commercial developments, including hotels and a shopping mall.
Large international conferences typically drive demand for hotels, transport, restaurants, entertainment, and other services, with the potential to revive Nairobi’s central business district and stimulate activity in surrounding towns.
“If you get MICE right, you revive an entire ecosystem,” Mr Some said. “Nightlife in Nairobi used to be big. Conferences can bring back that economy, not just in Nairobi, but beyond Nairobi as well.”
