This week, the American Chamber of Commerce, Kenya Summit was held in Nairobi, the 5th edition since 2018. At the summit, President William Ruto highlighted deliverables since his first summit as President in 2023, including removing VAT on exported services, availing tax refunds in 6 months, ending taxation of shares of startup employees, and removing a 30% local ownership requirement for tech companies.
Other notes from the Summit:
1. The contrast since the election of Donald Trump in 2004. From having a former Fortune 500 CEO as US ambassador to Kenya to today, when there are few confirmed US ambassadors in Africa.
2. The nimble pivot by US diplomats in the Trump era, where foreign policy is defined by mutual benefit. Wind power, which was prominent in 2023, is absent. At the Summit, Frank Garcia, Assistant Secretary of State for African Affairs, said the Trump administration has done 50 transactions worth $28 billion across Africa with leaders who want deals, not lectures.
3. China is absent in name, but countering it is present in the US strategy: The Lamu port is now in the picture. The US has been there for years for anti-terror reasons, but now it is more prominent as a transhipment centre away from the Middle East. Garcia remarked that deals need peace and economic growth can’t happen without security.
4. Gaining access to critical minerals that are not tied to China is key: Kenya’s Mrima Hills project was mentioned. Also, the Lobito Corridor in Southern Africa is back on track to quickly deliver critical minerals.
5. Quid pro quo diplomacy: Kenya supported the US with troops in Haiti and hosting Ebola patients. Lee Kinyanjui, Cabinet Secretary for Trade and Industry, said that, through such goodwill, Kenya is optimistic about completing a bilateral trade agreement with the USA, which goes beyond gains from AGOA.
6. Key financial reforms: Angela Ng’ang’a, President of AMCham Kenya, said priorities ahead include rules on transfer pricing and tax cross-border data flows, a more predictable tax regime and harmonization of economic zones framework.
7. Using Kenya to springboard is now a big play: Kenya connects Nairobi-based US firms to the East African Community of 300 million people, and COMESA of 700 million people, within the AFCFTA market of 1.4 billion.
8. Google, Microsoft, Meta, and Oracle are along for the ride, but a strategic goods control bill at Kenya’s Parliament may facilitate more US technology investments.
9. Data needs to flow to enable more trade, yet cross-border data flows are hampered by fragmentation, such as data protection laws that vary across countries, affecting digital services, payments, identity, e-commerce, and trade chains. Kenya has just published a paper on cross-border data transfers.
10. Just when you start to enjoy the East African anthem, you discover there is an African Union anthem that was played by the funky presidential escort band. #AmChamBizSummit
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