Weekly Business Update: Kenya & East Africa (January 11–18, 2026) | Dawan Africa

17 January 2026 – This week in business across Kenya and East Africa, markets, trade, and regulatory developments dominated the headlines.

From groundbreaking trade deals and private sector growth to regional disruptions and policy reforms, the past seven days have highlighted both opportunities and challenges shaping the economic landscape.

In this roundup, we break down the top stories, spanning Kenya’s export ambitions, capital markets, technology and payments, tourism and safety regulations, and regional developments in Uganda and Somalia, giving you a clear view of the forces driving business in East Africa.

TOP KENYAN BUSINESS HEADLINES

1. Kenya Signs Preliminary Duty‑Free Trade Deal with China

In a significant move, Kenya has signed a preliminary trade agreement with China that offers 98.2% of Kenyan goods duty-free access to the expansive Chinese market. This agreement, confirmed by the trade ministry, emerged following President William Ruto’s state visit to Beijing and represents an ongoing effort to address the longstanding trade imbalance between the two nations. A more favorable trade relationship could potentially boost Kenya’s export ambitions and aid local industries, positioning them for growth in global markets.

2. Strong Private Sector Growth Continues

According to data from the Stanbic Bank Kenya PMI, the private sector concluded 2025 on a robust note, with significant expansion observed in both manufacturing and services. Businesses reported higher sales, increased inventories, and improved supply deliveries, cultivating an overall optimistic sentiment as they entered 2026. This buoyant growth is indicative of a resilient economy navigating through the challenges presented in preceding years.

3. Capital Markets Start 2026 Strong

Kenya’s equities and bond markets began the year on a promising trajectory, with major indices on the Nairobi Securities Exchange (NSE) experiencing significant gains as trading activity surged and investor confidence improved. This early performance hints at a renewed enthusiasm among local and foreign investors, possibly setting a positive tone for the Kenyan economy throughout 2026.

4. Industrial & Service Sectors Lift Growth

The Central Bank of Kenya (CBK) noted that Kenya’s economy expanded by 4.9% in the third quarter of 2025, driven by a revival in the industrial sector and sustained growth in services. Key areas such as manufacturing, transport, finance, and real estate demonstrated resilience, laying a solid foundation as the nation transitions into 2026.

5. KNCCI Warns over Soaring Pending Bills

The Kenya National Chamber of Commerce and Industry (KNCCI) has raised alarms regarding the staggering government and county pending bills, which exceed Sh700 billion. This backlog is severely impacting cash flows, posing increased insolvency risks for private businesses. The KNCCI is urging authorities to accelerate payment to safeguard jobs and maintain commercial activity within the economy.

6. New CMA Reforms to Transform Retail Forex Trading

The Capital Markets Authority (CMA) has introduced reforms designed to enhance investor protection and elevate standards in retail forex trading. As AI-powered tools attract a younger trading demographic, these reforms aim to curb predatory practices while ensuring a transparent and secure trading environment for everyday investors.

7. Tourism Sector Targets Sh1 Trillion by 2027

Kenya’s tourism sector has set an ambitious goal of achieving Sh1 trillion in revenue by 2027. This initiative will leverage new strategies, such as positioning the Port of Mombasa as a premier cruise destination, increasing hotel capacity, and diversifying tourism offerings. Officials emphasize the need to attract more international visitors, particularly in the business and luxury travel segments, to reach this target.

8. Investment Slowdown Amid Job Growth Paradox

Recent analysis indicates a slowdown in major capital investments despite an uptick in job creation. This trend points towards a potential shift in investor preferences towards smaller, labor-intensive ventures rather than large-scale, capital-intensive projects. Economists suggest that this mixed signal reflects a need for policies that foster substantial, strategic investments in vital sectors.

9. Safaricom Share Sale Under Scrutiny

The planned partial sale of the government’s 15% stake in Safaricom PLC continues to ignite debate. While the National Treasury advocates for its single-bidder process, critics, including professional accountants, caution that this approach may not optimize taxpayer value. Safaricom, being Kenya’s most profitable enterprise and a cornerstone of the digital economy, requires prudent handling to ensure its benefits resonate throughout the economy, especially through platforms like M-Pesa.

10. TRA Warns Against Unsafe Safari Transport

The Tourism Regulatory Authority has issued a warning to tour operators against using open-sided Land Cruisers on public highways, citing safety violations that could jeopardize tourist safety. This directive is crucial for maintaining the integrity of Kenya’s reputation as a leading global safari destination and ensuring compliance with safety standards.

11. KRA Seizes KSh281 Million in Contraband Cigarettes

In an intelligence-led operation, the Kenya Revenue Authority (KRA) confiscated 9.37 million contraband cigarettes valued at KSh281 million at the Port of Mombasa. This seizure reflects ongoing challenges posed by illicit trading practices that undermine lawful businesses and ripple through the economy by eroding government revenue.

12. Visa Works to Restore Uber Card Payments in Kenya

In response to recent disruptions in payment services, Visa is actively working to restore card payment functionalities for Uber in Kenya. This move aims to reconnect a vital service to its user base and enhance convenience for customers, reinforcing the partnership’s value within the fast-evolving technology and payments landscape.