The Kenyan government has begun implementing measures against foreign nationals operating small retail shops and engaging in hawking, following President William Ruto's directive to shut down such businesses starting September 7. Ruto made the announcement on September 2 while addressing micro, small and medium-sized enterprise (MSME) traders at State House in Nairobi.
Ruto stated that foreigners should not compete with Kenyans in businesses such as hawking and small retail, while welcoming foreign investment in activities requiring greater capital and investment. He directed authorities to begin closing small businesses operated by foreign nationals, saying hawking and small-scale retail should be reserved for Kenyans. The government will take administrative action while Parliament considers the proposed Local Content Bill, 2025.
Ruto also instructed National Assembly Majority Leader Kimani Ichung'wah and Trade Cabinet Secretary Lee Kinyanjui to expedite the bill's passage. Hesbon Hansen Owilla, a professor at Aga Khan University in Nairobi, supported the policy, telling Al Jazeera: "Yes, this is the best way to protect Kenyan small businesses and traders. Kenya is trying to bring in only investors who bring capital that can spur economic development by creating jobs rather than allow small-time foreign traders who only stifle Kenyan small traders while enjoying the robust infrastructure that Kenya has built and social securities."
The proposed Local Content Bill, 2025, would require foreign companies to increase local sourcing and employment. However, the bill is still under parliamentary consideration. The government has not provided a comprehensive list of businesses covered by the September 7 directive or an estimate of affected foreign nationals.
Foreign Affairs Principal Secretary Korir Sing'Oei said on September 6 that foreign nationals meeting Kenya's legal requirements, including work permits and licenses, remain legally protected. He claimed Ruto's remarks were taken out of context and related to the Local Content Bill.
According to the Kenya National Bureau of Statistics, the country's foreign direct investment stock reached 1.458 trillion Kenyan shillings ($11.27bn) by end-2023, up 8.5% from 2022. Surveyed foreign-invested enterprises employed 224,769 people in June 2024, including 221,267 Kenyans.
Separately, the government suspended Tata Chemicals Magadi's soda ash operations at Lake Magadi on July 28, citing compliance issues. On September 3, Ruto ordered the company to leave Kenya, claiming it had not provided sufficient benefits to the local community. Tata Chemicals said it had submitted requested information and remains committed to resolving the matter through legal channels.
International business consultant Solomon Kinyanjui noted that the issue is not whether foreign capital is welcome but its role: it should complement Kenyan enterprise, not substitute for activities Kenyans can competitively undertake. Journalist Hafsa Abdiwahab Sheikh warned that while the policy could create jobs, unpredictable implementation might deter foreign investment and increase business costs.
Source: www.aljazeera.com