More than 100 companies have expressed interest in taking part in a planned special economic zone in Mombasa, a development that will lead to establishment of an industrial park at the Coast.
The Dongo Kundu Free Trade Port area is financially backed by the Japanese government and aims to boost manufacturing to take advantage of expansion projects that have boosted the capacity of the port of Mombasa.
More than 100 companies from Japan, Europe and Asia have shown interest in setting up shop at the planned economic zone. Dr Moses Ikiara, managing director of the Kenya Investment Authority, says these developments will help the country tap greater flows of investment dollars.
The setting up of the special economic zone was one of the key agreements struck during the Tokyo International Conference on African Development (TICAD) in Nairobi last August.
The meeting, the first to be held in Africa, agreed to help countries on the continent accelerate their manufacturing sectors.
On April 18, chief executives of more than 100 companies interested in setting up shop at the SEZ met in Nairobi to endorse the initiative.
Kenya will offer a raft of incentives to firms operating at the SEZ, in line with provisions of the Fiscal Incentives Act, 2015.
Among these are corporate tax rates of 10 per cent for the first 10 years and 15 per cent for another 10 years.
Among the non-fiscal incentives are the granting of work permits to up to 20 per cent of employees in the companies.
Working jointly, the governments of Kenya and Japan — the lead implementation partners — will invest in accompanying infrastructure necessary to back operations of the free port area.
These include expansion of the Rabai sub-station through installation of a 90 MVA transformer to supply power. A 26.5 km power transmission line to the SEZ will also be laid.
Short-term water supply will be tapped from Kayabombo Reservoir and long-term supply is anticipated from Mwache Dam, which is expected to be constructed by 2022 with support from the World Bank.
At peak operation, it is expected that the special economic zone will employ 27,100 people. The Mombasa project is modelled on the Eastern Seaboard Development Plan in Thailand, which is backed by Japan.