- Norfund invested US$32 million in Kenya in 2022 and plans to further increase financing to local enterprises seeking growth support in 2023
- The fund said it would continue to invest in the region, focusing on profitable enterprises with the potential to contribute to economic and social development
- Norfund is owned and funded by the Norwegian Government and has a portfolio of US$372 million invested in Kenya across various sectors of the economy
The Norwegian Investment Fund (Norfund) invested US$32 million in Kenya in 2022 and plans to further increase financing to local enterprises seeking growth support in 2023.
On February 9, 2023, Norfund said it would continue to invest in the region, focusing on profitable enterprises with the potential to contribute to economic and social development.
Norfund helps build sustainable businesses that would not otherwise be developed because of the high risks involved by providing equity and other risk capital in developing countries.
Norfund mitigates its operating risks through market insights, local presence, and portfolio diversification and actively maintains a diversified portfolio of countries, instruments, currencies and sectors, thereby reducing the impact of adverse events in one or more markets.
Norwegian investments in Kenya
As such, the fund has advised profitable local enterprises seeking to expand their operations and the market in Kenya to apply for funding access and business development support as part of the institution’s commitment to deepening its local presence.
Norfund is owned and funded by the Norwegian Government. It has a portfolio of US$372 million invested in Kenya across various sectors of the economy. It has investment interests in Equity Bank, D-light, Ascent Capital, and Marginpar, among others.
Norfund Regional Director William Nyaoke said the development finance institution’s mandate is to assist in building sustainable businesses and industries in developing countries like Kenya. They do this by providing capital in renewable energy, financial inclusion, green infrastructure, and scalable investments, in line with the UN’s Sustainable Development Goals.
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“In Kenya and beyond, Norfund contributes to economic and social development by helping to build sustainable businesses that would not otherwise access expansion capital because of the high levels of risk involved,” Nyaoke said.
“Our investees contribute to economic and social development through the direct and indirect jobs they create, the goods and services they offer, and the taxes they pay, and we are confident that the recent US$32 million outlay in 2022 will have positive ripple effects in Kenya,” he added.
Norfund investments in East Africa
Norfund East Africa handles Norfund’s existing and new regional investments with a particular focus on Kenya, Uganda, Tanzania, Rwanda and Ethiopia from its Nairobi headquarter.
Norfund can also invest in other countries in Eastern Africa, like Somalia and South Sudan, in partnership with other investors and funds. In 2022, Norfund committed US$75 million across East Africa.
Norfund’s revelations come ahead of a visit to Kenya by its Global CEO Tellef Thorleifsson to witness the organisation’s new financing sign up with several local enterprises.
Kenya, China in talks to grow investments locally
In a related story, Deputy President Rigathi Gachagua recently said that the government is committed to growing foreign direct investments.
Speaking when he hosted the Chairman of the Chinese Chamber of Commerce William Zhou, Gachagua said the move would, in turn, create job opportunities and support the economy’s growth. The team discussed several opportunities in Kenya in the broad areas of manufacturing, ICT, and the automobile industry, with focus on the realisation of Kenya’s Vision 2030.
Meanwhile, earlier this week, Kenya and the United States held bilateral trade talks, with the first round of in-person discussions taking place in Washington DC.
The Kenyan delegation is scouting for areas of collaboration that will increase foreign direct investment, promote sustainable and inclusive growth, and support women and small and medium enterprise businesses.
The U.S. is pushing for duty-free market access for its goods, including agricultural and industrial. Kenya seeks to protect its local manufacturers and grow exports even as the Kenyan negotiators push for better terms.
The Cabinet Secretary for Trade Moses Kuria has said his target is to grow investments in Kenya from the current $500 million annually to $10 billion in five years and increase the value of exports from the current 10pc of GDP to 30pc by the year 2025.
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