Kenya has initiated a crackdown on foreign nationals operating small retail shops and engaging in hawking, following directives from President William Ruto to shut down such enterprises beginning September 7. The announcement was made on September 2 during an address to micro, small, and medium-sized enterprise (MSME) traders at State House in Nairobi.
President Ruto emphasized that while foreign investment remains welcome, particularly in sectors requiring substantial capital, small-scale trading and hawking should be reserved for Kenyan citizens. He directed authorities to commence administrative closures immediately, even as the Parliament considers the proposed Local Content Bill, 2025. Ruto tasked National Assembly Majority Leader Kimani Ichung’wah and Trade Cabinet Secretary Lee Kinyanjui with expediting the bill’s legislative passage.
Hesbon Hansen Owilla, a professor at Aga Khan University, supported the policy, stating it is essential for shielding Kenyan small businesses. He argued that the government aims to attract investors who bring capital and create jobs rather than foreign traders who may stifle local competition while benefiting from Kenya’s infrastructure and social services.
The proposed Local Content Bill, 2025, would mandate that foreign companies increase local sourcing and employment. Although still under parliamentary consideration and not yet enacted into law, the bill aligns with the current administrative actions.
While the directive specifically targets small retail and hawking, it is unclear how many foreign nationals hold existing permits to operate in these sectors. Foreign Affairs Principal Secretary Korir Sing’Oei clarified on September 6 that foreign nationals who meet legal requirements, including holding valid work permits and licenses, remain legally protected. He suggested Ruto’s remarks were taken out of context and should be viewed within the framework of the Local Content Bill.
Data from Kenya’s 2024 Foreign Investment Survey by the Kenya National Bureau of Statistics indicates that foreign direct investment stood at 1.458 trillion Kenyan shillings ($11.27bn) at the end of 2023, an 8.5 percent increase from 2022. Foreign-invested enterprises employed 224,769 people as of June 2024, with Kenyans comprising 98.4 percent of the workforce.
Separately, the government suspended mining operations at Tata Chemicals Magadi on July 28 due to alleged compliance issues with mining laws. On September 3, Ruto ordered the soda ash company to leave Kenya, citing insufficient benefits for the local Kajiado County community. Tata Chemicals maintains it has complied with regulatory requirements and is seeking resolution through legal channels.
Business consultant Solomon Kinyanjui noted that the policy distinguishes between foreign capital that complements Kenyan enterprise and activities that displace it. Journalist Hafsa Abdiwahab Sheikh added that while the move could create local jobs and protect employment, unpredictable implementation might discourage investment and raise costs for consumers.
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