Despite being East Africa’s largest economy, Kenya faces significant regulatory hurdles hindering business growth, particularly for SMEs and manufacturers. Complex trade regulations, a challenging tax regime, and an intricate licensing system undermine progressive reforms and stifle entrepreneurship.

• Non-tariff barriers (NTBs), inconsistent customs, and infrastructure deficits add an estimated 20-30 percent to transport costs for exporters, despite the AfCFTA aiming to boost intra-African trade by 15-25 percent by 2040.
• Digital businesses face a complex maze of at least seven different licenses and the 1.5 percent Digital Service Tax (DST), with compliance costs consuming up to 15 percent of operational budgets for some startups.
• Manufacturers contend with at least 12 different tax obligations, and the convoluted licensing regime requires over 15 different permits for a medium-sized enterprise, with county license fees varying from KSh 15,000 to over KSh 100,000.
• Work permit processing times often exceed 90 days, costing up to KSh 500,000 for some categories, making them among the most expensive in the region.