Kenya’s President William Ruto attends an interview with Reuters on the sidelines of the G7 summit in Evian-les-Bains, France, June 17, 2026. Image@ REUTERS/Denis Balibouse
Kenya attracted a record $3.2 billion in foreign direct investment (FDI) in 2025, more than double the $1.5 billion recorded in 2022, according to UNCTAD’s newly released World Investment Report 2026. President William Ruto said the milestone reflects growing global confidence in the country’s economic direction under his administration.
The broader global picture makes Kenya’s performance even more striking. UNCTAD said worldwide FDI rose 6% in 2025 after two consecutive years of decline, but the recovery remained fragile and uneven. Most developing economies recorded only modest gains, making Kenya one of the standout performers among emerging markets. The report also noted that Africa is attracting more investment into strategic industries, though the long-term impact will depend on whether those inflows drive wider industrial growth.
Responding to the figures on X, Ruto linked the surge to sectors he said are powering Kenya’s economy.
“This is a clear vote of confidence in Kenya’s future. The momentum is driven by our fastest-moving sectors: development of clean geothermal energy and digital infrastructure, financial services, and manufacturing,” he wrote.
The increase is particularly significant given Kenya’s economic position when Ruto took office in September 2022 after a closely contested election. His administration inherited an economy under pressure from high inflation, a weakening shilling and growing fiscal challenges. Some government estimates placed FDI inflows for 2022 at about $800 million, highlighting the scale of the rebound from a relatively low base.
Since then, the government has made attracting foreign investment a central part of its economic strategy. Kenya’s Strategic Plan 2023–2027, launched in May 2024, set an ambitious target of raising annual FDI from roughly $500 million in 2022 to $10 billion by 2027. The plan focuses on improving the business environment, expanding special economic zones and developing investment-ready projects to draw foreign capital. It complements Ruto’s Bottom-Up Economic Transformation Agenda, which prioritises agriculture, small businesses, affordable housing, universal healthcare and digital infrastructure.
Ruto also credited the gains to broader economic stability.
“This very positive economic outlook is anchored by a stable shilling, a rallying stock market, and bold reforms, including our privatisation agenda, that is opening new doors for private capital,” he said.
Kenya has also strengthened its investment ties through new trade agreements, including a Comprehensive Economic Partnership Agreement with the United Arab Emirates, signed in February 2024, and an Economic Partnership Agreement with the European Union, concluded in December 2023. Both are intended to boost trade and encourage greater investment.
Despite the record inflows, Kenya still faces longstanding challenges. Investors continue to cite infrastructure deficits, skills shortages, inconsistent licensing processes across counties and corruption as obstacles. The country ranked 121st out of 180 countries on Transparency International’s 2024 Corruption Perceptions Index.
Whether the record investment marks the beginning of a sustained trend will depend on how effectively the capital is used to expand industries, create quality jobs and strengthen technology transfer. Strong investment figures alone won’t guarantee lasting economic transformation.
By: Andrews Kwesi Yeboah