As we look ahead to 2025 with ambition, a review of the global Foreign Direct Investment (FDI) landscape in 2024 reveals a complex interplay of challenges and opportunities.In 2024, global FDI flows experienced a modest rebound, reaching approximately $1.3 trillion, a two percent increase from the previous year, with Asia taking the dominant share. Africa, home to approximately 1.4 billion people and immense mineral wealth, remains the world’s most untapped continent, brimming with potential yet struggling to translate its promise into tangible economic opportunities. Africa attracted only $53 billion in FDI inflows, representing a mere four percent of global inflows and marking a three percent decline from the previous year—the continent continues to face challenges in unlocking inclusive and broad-based investment. Regionally, a three percent decrease in FDI was noted in East Africa with inflows totalling $10.6 billion, representing a 20 percent share of the total haul into Africa. As one of East Africa’s most dynamic economies, Kenya holds immense potential to attract FDI by leveraging its unique geographical position and focusing on high-impact sectors. To realise this potential, Kenya must adopt a targeted strategy that emphasises mass job creation, value addition, and infrastructure development.This requires implementing bold and investor-friendly policies that create a stable, transparent, and enabling environment to attract and sustain global FDI inflows.Agriculture and livestock-based manufacturingKenya’s agriculture sector, a cornerstone of its economy, employs a significant portion of the population but remains underutilised in terms of value addition.With global food trade exceeding $1 trillion, the country has a unique opportunity to unlock its potential by breaking cartel-like monopolies and inviting global players to leverage its vibrant ecosystem. Developing holistic value chains is essential—transforming cotton into fabric and apparel, oilseed crops into oil extracts, and livestock farming into end-consumer products.With right policies, Kenya can and must headhunt the right global players with the desired technical knowhow, ready markets and the desired equity capital.Mining and natural resourcesKenya, endowed with untapped mineral resources such as titanium, copper, manganese, gold, rare earth minerals, and limestone, has immense potential in the mining sector, which remains largely underdeveloped, but has significant potential to transform its mining sector into a driver of economic growth.Core infrastructure development through PPPsKenya’s economic growth relies heavily on robust infrastructure, yet critical gaps remain in roads, airports, power supply, and water systems.Public-Private Partnerships (PPPs) offer a practical solution, provided lessons from previous setbacks are effectively addressed. Reviving the PPP initiative to modernise Jomo Kenyatta International Airport (JKIA) is vital for positioning Kenya as Africa’s leading logistics hub. Similarly, prioritising the Usahihi Nairobi-Mombasa Expressway will reduce transportation costs, strengthen regional connectivity, and boost domestic tourism. Leveraging its strategic location and strong ties with an economically pragmatic incoming US administration, Kenya has a unique opportunity to drive these two transformative projects forward. Additionally, Kenya must refine its Special Economic Zone (SEZ) strategy; while SEZs are essential hygiene factors for FDI, they require a focused and strategic approach to attract enterprises aligned with the country’s economic priorities. Integrating select public SEZs into transparent PPP frameworks could expedite their operationalisation. (ICE NAIROBI)

Fonte notizia: Business Daily