Special Economic Zones: Where to Find Them in Kenya

Special Economic Zones (SEZs) offer incentives to promote investment, with licensing as SEZ Enterprises or Operators. Kenya has Public and Private SEZs, like Dongo Kundu, Mombasa Industrial Park, Naivasha, and Konza Technopolis. Local businesses can also benefit and CM-SME assists in licensing for SEZ incentives.

 Special Economic Zones (SEZs) are usually carved out as geographical locations within a country that are incentivized, through provision of high-quality infrastructure, attractive fiscal incentives and minimum regulation to carry out certain economic activities with the aim of mostly generating foreign direct investment or boosting local investment in certain economic sectors. 

Sometimes there are requirements that mandate that the Special Economic Zone areas to be physically demarcated from the rest of the area just to clearly set it apart from the rest of the area. 

For an entity to benefit from the exemptions available to SEZ, they must be licensed to operate as a Special Economic Zone Enterprise or a Special Economic Zone Operator or Developer.  

The distinction that is made between a Special Economic Zone Developer/Operator and Special Economic Zone Enterprise is that an SEZ Developer/Operator is a company that is licensed to set up develop or operate a Special Economic Zone, while an enterprise is any business enterprise set up to carry out activities eligible to be carried out in a particular SEZ. There is a legal requirement that Special Economic Zones Enterprises should be set up within the Special Economic Zones. 

As we have stated in our past articles, SEZ’s benefit from the application of different legal regime that exempts them from certain legal obligations such us taxes, licensing e.t.c. Read article on Benefits of SEZs Here. 

For small and medium enterprises to take advantage of these benefits available to SEZ’s they must set up their business in the Special Economic Zones and engages in activities that support the ecosystem of activities that a particular SEZ purposes to undertake and obtain licenses to operate. 

Currently Special Economic Zones are created as either Public SEZ’s or Private SEZ’s. Public SEZ’s are developed and managed by the government while Private SEZ’s are developed and managed by private developers. 

SEZ’s are also designated as multi-sector or single- sector SEZ’s and may include: 

(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; 

Below we list some of the SEZ’s in the country and highlight their geographic locations. 

Public SEZ’s 

Public SEZs include; 

Dongo Kundu SEZ 

This SEZ which is a multi-sector SEZ which   is licensed to act as an Industrial park and Free Trade Zone. 

Dongo Kundu SEZ is approximately 3,000 acres large, adjacent to the Mombasa Port in Likoni Sub-County of Mombasa County. 

Its strategic location, next to Mombasa Port which is Kenya’s main gateway for international trade makes it ideal for firms targeting global markets and export-oriented industries. 

Mombasa Industrial Park SEZ 

Mombasa Industrial Park SEZ is being developed by the Mombasa County government. It is designed as Multi-Sector SEZ acting as an Industrial park and Free Trade Zone. 

Naivasha SEZ 

Naivasha SEZ is located on 1000 acres of land in Mai Mahiu in Nakuru County along the Nairobi - Naivasha Standard Gauge Railway (SGR) line. Once development is complete, the SEZ will offer trans-shipment facilities to allow the seamless interchange between SGR and Meter Gauge Railways (MGR) to handle the cargo destined for EAC and Central African Countries. The SEZ comprises of an Internal Container Deport and a Logistics Zone, Railway Marshalling Area and Industrial Parks. 

Konza Technopolis SEZ 

Located in Malili, Makueni County on 5,000 acres of land. The area will also be connected with Mombasa-Nairobi SGR. 

PRIVATE SEZ’s 

Private SEZ’ include Tatu City in Kiambu County, Africa Economic Zones in Uasin Gishu, Compact Free Trade Zone in Nairobi, Northlands in Kiambu, Mount Kipipiri Golf & Resort in Nyandarua and East Africa Free Zone in Mombasa. 

These SEZ’s are at various stages of operationalization. 

 CONCLUSION 

While SEZ’s mostly primarily target Foreign Direct Investment, local investors can also take advantage of the incentives available to SEZ’s and set up Small and Medium sized enterprises    within the SEZs.  

HOW CAN WE HELP YOU? 

At CM-SME we help SMEs that would like to take of the incentives available to SEZ enterprises, apply for the licensing. We advise on the licensing requirements and help your business through the entire process from making the application to obtaining the license. 

 

Published on Aug. 22, 2024, 1:10 p.m.