Investment in tech expats, research hits record Sh21bn
The State has attributed the drop to the failure of researchers to fully utilise the annual allocation, in which has forced institutions of higher learning to diversify their funding sources including seeking grants for research activities.
Investment by Kenyan firms in foreign experts in technology research and development has shot up sharply to nearly Sh21 billion with sights on reaping the dividends of the global shift to IT.
Fresh data from the Kenya National Bureau of Statistics (KNBS) shows that local businesses upped their expenditure on research services provided by non-residents to Sh20.9 billion in 2022 up from the Sh575.3 million spent the previous year, making it the fastest-growing services expenditure band.
The spending propelled the cluster to account for 12.1 percent of all expenditure by Kenyans on services provided by expatriates, rising from the 0.3 percent it accounted for in 2021.
The growth in expenditure on research services came at a time when the overall expenditure on services declined 7.9 percent to Sh172.2 billion, driven chiefly by reduced expenditures on financial and insurance services.
“Expenditure on services provided by non-residents declined by 1.3 percent to Sh186.9 billion in 2021, and further by 7.9 percent to Sh172.2 billion in 2022. The decline in expenditure was mainly attributed to reduced expenditures on financial and insurance services, over the review period,” states KNBS.
“Financial services accounted for the largest share of total expenditure on services, averaging 65.5 percent over the review period.”
The KNBS disclosures come at a time when the government has been found to have slashed research funding in the country by Sh2 billion over the last decade, adversely impacting the operations of the National Research Fund.
The State has attributed the drop to the failure of researchers to fully utilise the annual allocation, in which has forced institutions of higher learning to diversify their funding sources including seeking grants for research activities.
According to KNBS, technical and trade services were the second fastest growing band in 2022, with expenditures to pay non-residents rising to hit Sh9.2 billion accounting for 5.4 percent of the overall expenditure up from Sh2.7 billion (1.4 percent) in 2021.
Other services majorly sought from expatriates during the review period included insurance which accounted for 3.4 percent of all services expenditure, computer services (3.3 percent), charges on intellectual property (2.3 percent), accounting, management consulting and public relations services (2.2 percent) and telecommunications services (1.6 percent) among others.
