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Expanding operations into Kenya? Brainstorm sets the scene on what to expect.

Read time 2min 50sec

Kenya has established an international reputation for its Masai Mara Nature Reserve, for its rich diversity of people and cultures, and commercial hotspots like Mombasa and Nairobi. Innovation and a market eager to open up for business are positives for potential investors, but there are challenges that must be considered before any commitment is made.

ICT market analysts refer to statistics that, at least on paper, support the idea that the east African country is gaining traction.

Mark Walker, associate vice president: Sub-Saharan Africa at IDC, says Kenya's IT market, which includes hardware, software and IT services, is expected to generate $2.3 billion this year, and achieve growth of between eight and ten percent in 2016.

A Deloitte report titled 'Competitiveness: Catching the next wave' states the projected growth by the ICT sector in Kenya (based on compounded annual growth rates between 2015 and 2034) stands at almost eight percent.

The region made headlines when its ranking on the World Economic Forum (WEF) 2015 Global Information and Technology Report and Networked Readiness Index moved up six places to 86th position this year.

Increased government investment in ICT (specifically the development of the Konza Tech Centre and the ongoing efforts to establish the Silicon Savanah), and sustained interest in Sub-Saharan Africa from multinationals like Google, Microsoft and IBM, demonstrate a region on the rise.

But while Kenya looks good on paper, the question still remains: what is the reality of doing business there?

Political will

Research seems to support the idea that Kenya has done a lot right in terms of positioning its ICT sector to support its economy, and that it has mobilised its resources effectively - and, perhaps most importantly, demonstrated that there is a political will to strengthen and sustain this critical sector.

The level of innovation around technology and investment aside, countries in Africa are being evaluated based on the pace of digital transformation in society and the extent to which this makes a meaningful difference to people.

Here, again, Kenya has made progress. In January this year, the country's capital Nairobi was listed by the Intelligent Community Forum as one of its Smart21 intelligent communities globally and the only African city to be featured in this exclusive group.

The country is considered a stronghold when it comes to mobile technology, more specifically mobile payment services, with M-Pesa leading the charge. IT stalwarts like Airtel and Safaricom have embarked on plans to roll out LTE networks and relevant services.

The fact that businesses like Safaricom, a dominant force within the country's mobile payment solution space, are now being confronted by significant competition - from the likes of Ecobank - speaks to the growth and maturity of this market.

Analysts say there is a definite sense of greater vibrancy in ICT in Kenya, despite it lagging dramatically in infrastructure.

This article was first published in Brainstorm magazine. Click here to read the complete article at the Brainstorm website.

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