Special Economic Zones

Special Economic Zones
in Kenya
PROGRESS ON THE ESTABLISHMENT OF SPECIAL
ECONOMIC ZONES IN KENYA
1
The Kenya Industrialization Strategy “An Aspiration
To Attain Vision 2030”
• To grow our GDP by $4-7bn per year for next 13 years
• To drive this growth, we must increase our manufacturing

base from 11% of GDP to 20% of GDP
• Additionally, we must dramatically increase our FDI as

regional neighbors are attracting 2-3x more FDI
• To do this, we must improve the ease of doing business in

Kenya, improve infrastructure and reduce electricity costs
• The Ministry has outlined a clear roadmap for how to rapidly

industrialize Kenya and achieve our aspiration through the
“Kenya Industrialization Transformation Plan (2014-2022)
2
SPECIAL ECONOMIC
ZONES
A carefully master-planned integrated modern Industrial City to attract
Foreign & Domestic Direct Investments where goods introduced and
services provided are generally regarded, in so far as import duties and
taxes are concerned, as being outside the customs territory
The Kenya vision 2030, envisions 3 world-class Special Economic Zones

for Kenya
•1) Greater Mombasa SEZ : 3,000 sq km – (to create 2 million new jobs).
•2) Lamu SEZ: 700 sq km – (to create 1 million new jobs).
•3) Kisumu SEZ: 700 sq km- (to create 1 million new jobs).
3
Objectives of SEZ’s
The overall objective of SEZs program:
To contribute towards the transformation of the country’s economic
base in order to realize a higher and sustained growth, employment
creation and poverty reduction in the country.
The specific objectives of SEZs are:
– To attract both local and foreign investments
– To expand and diversify production of goods and services for
domestic and export markets
– To promote value addition
– To promote local entrepreneurship through Small and Medium
Enterprises (SMEs)
– To enhance technology development and innovation
– To promote rural and regional industrialization by exploiting
comparative advantage of local resources
4
Legal Framework and Achievements
• Legal & Policy framework
• Kenya and EAC SEZ policy prepared
• Special Economic Zones Law was enacted in 2015 (SEZ Act, No. 16
of 2015)
• The 1st set of SEZ Regulations were Gazetted vide Legal Notice No.
147, Kenya Gazette Supplement No. 130 of 5th August 2016
• Institutional Framework
• SEZA board inauguration done in Feb 2017
• All other Board Members are in place
• SEZA in operation
• Designation and Licensing
• So far the SEZA has designated and licensed two Private Zones (AEZ
and Tatu City) and is in the process of licensing KONZA , LAMU
(LAPPSET) SEZ and many other private SEZ
5
Legal Framework and Achievements
• Dongo Kundu SEZ

– Master Plan Finalized
– Strategic Environmental Assessment Done and approved by
NEMA
– Resettlement action Plan Done
– Comprehensinve Enviromental Management Plan ongoing
– Detail Design ongoing
• Naivasha Industrial park

– Land purchase on going
– Promotion of investment ongoing
6
Dongo Kundu Transshipment Port & SEZ
Logistics & Trade &

warehousin exhibition
g
Processing &
manufacturing
Port handling
Living & Comprehensive

recreation service
7
Master Plan – Project Layout (Mombasa SEZ)
Total area is
about 1200
hectares.
• Industrial land is
273.89 hectares;
• Warehousing
land is 174.45
hectares;
• Commercial land
of 82.10
hectares;
• Residential land
of 68.53
hectares;
• Road and traffic
facilities land is
121.24 hectares;
• Green land is
206.69 hectares.
• Non construction
land is 170.648
hectares.
SEZ Act
The object and purpose of this Act is to provide for: -
(a) an enabling environment for the development of all aspects of special

economic zones including:-
(i) development of integrated infrastructure facilities;
(ii) creation of incentives for economic and business activities in areas

designated as special economic zones;
(iii) removal of impediments to economic or business activities that generate
profit for enterprises in areas designated as special economic zones; and
(b) the regulation and administration of activities within the special economic
zones with due regard to the principles of openness
9
SEZ Act
Special Economic Zones may include, but not limited to:
(a) free trade zones;

(b) industrial parks;
(c) free ports;
(d) information communication technology parks;
(e) science and technology parks;
(f) agricultural zones;
(g) tourist and recreational zones;
(h) business service parks;
(i) livestock zones.
10
Incentives by SEZ
The SEZ scheme will offer both general and specific incentives which
will include;
•SEZ Fiscal Incentives
– 10% corporate tax for first 10 years;
– 15% corporate tax for subsequent years;
– Duty & VAT exemption;
– 100 per cent of the investment allowance on cost of building
and machinery.
– Exemption from stamp duty; and
– Exemption for withholding tax
– Exempt from export duty and Import Declaration Fees
respectively for goods exported to and imported by an
enterprise licensed under the SEZ Act
11
Incentives by SEZ
Other Incentives
• Single license;
• Procedural/Administrative incentives-transparency in licensing
processes, quick acquisition of permits(OSS)and continual
facilitation through the project stages of operation
• World class infrastructure and customized facilities
12
THANK YOU!
13

Special Economic Zones

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Special Economic Zones

• To grow our GDP by $4-7bn per year for next 13 years

• To drive this growth, we must increase our manufacturing

• Additionally, we must dramatically increase our FDI as

• To do this, we must improve the ease of doing business in

• The Ministry has outlined a clear roadmap for how to rapidly

The Kenya vision 2030, envisions 3 world-class Special Economic Zones

•2) Lamu SEZ: 700 sq km – (to create 1 million new jobs).

• Dongo Kundu SEZ

• Naivasha Industrial park

Logistics & Trade &

Living & Comprehensive

(a) an enabling environment for the development of all aspects of special

(ii) creation of incentives for economic and business activities in areas

(a) free trade zones;

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