The government is banking on the new development partnership with the European Union (EU) to boost the country’s private sector and spur economic growth.

The deal between Kenya and EU is expected to unlock access to vast markets for both parties and more funding for Kenyan businesses which have largely been financing challenges fronted by the unfavourable credit by the Kenyan banks.

President William Ruto noted that the partnership agreement connects businesses in the country’s vast markets, including the $503 billion (Sh64.90 trillion) gulf market. Closer home, the country remains a key partner in the East African community, which will connect European businesses to a $336-billion common market with a population of 300 million people.

Speaking during the launch of EuroCham, a European chamber of commerce in Kenya, at a Nairobi Hotel, Ruto said each of the agreements connect Kenyan businesses to global opportunities, unlocking markets, attracting investments, and driving shared prosperity.

“We remain committed to implementing a pro-trade policy regime that not only fosters inclusive wealth creation, but also generates much-needed opportunities,” he added. “Our goal is to build a comprehensive, resilient economy that benefits every Kenyan, while strengthening mutually beneficial partnership with allies like the EU.”

At the heart of this is digital inclusion, which Ruto believes will enable Kenyan businesses to seamlessly connect with different EU markets and key market players. In light of this, he noted that in the coming Finance Bill, 2025, the government is seeking to reduce the digital asset transfers from 3 per cent to 1.5 per cent.

Transferred or traded

A digital asset is anything that exists only in digital form and comes with a distinct usage right. In this regard, they can be stored electronically and can be bought, sold, owned, transferred or traded.

This is currently gaining momentum not only in the country but globally and is linked to the future of trade. The Internal Revenue Authority (IRS), a US agency defines digital assets as any digital representation of value recorded on a cryptographically secured, distributed ledger (blockchain) or similar technology (Infrastructure Investment and Jobs Act).

According to the Ministry of ICT and Digital economy Cabinet Secretary, William Kabogo, who also spoke during the same event, said the government is aligned towards establishing up to 1,450 digital hubs in the country to not only help in boosting the initiative, but also the skills bridging for the Kenyan youth.

“What we are trying to do is to ensure that we have 100 per cent connectivity in the country and this will serve in boosting the connectivity of the Kenyan businesses with the European markets in the long run,” he said.