Former Secretary-General of the United Nations Conference on Trade and Development (UNCTAD), Mukhisa Kituyi has pointed an accusing finger at several policies and measures behind the mass exodus of investors from Kenya.

Speaking to a local radio station on Monday, February 10, 2025, Mukhisa Kituyi detailed that capitalists were moving to other countries which were according to them conducive environment to thrive.

He cited the return of informal and shadowy tax measures which he argued had made it difficult for investors to sustain operations in Kenya. Besides informal taxes, Mukhisa Kituyi attributed the mass fleeing of investors to the cost of energy which he argued was pricey.

He further faulted the country for introducing multiple taxes on products and services which he maintained were detrimental to capitalists.

“Private capital has been flying out of Kenya before USAID came because of the hostile investment climate in Kenya, the multiplicity of taxes and red tape, the return of shadowy informal taxation and the high cost of energy,” Mukhisa Kituyi explained.

Tanzania attracting investors

The former UNCTAD Secretary-General detailed that Tanzania was gaining much from the current systems pushing away investors. He claimed that most investors were setting their manufacturing hubs in Tanzania and then exporting the finished products to Kenya.

“Many investors are relocating from Kenya to Tanzania and manufacture under less hostile conditions and export to Kenya duty-free because Kenya and Tanzania have no customs boundaries between them,” he noted.

Defending his sentiments, Mukhisa Kituyi maintained that President William Ruto recognised the changing trend and lauded Tanzania for surpassing Kenya as the leading trading hub in East Africa, further commending the Samia Suluhu-led nation’s progress in boosting regional trade.

“It is a phenomenon that has been happening even the president of Kenya was in Tanzania and said he celebrates Tanzania for exporting more to Kenya than importing, it is a reality,” he remarked.

Speaking during the 25th commemoration of the East African Community (EAC) in Arusha on November 30, 2024, Ruto praised Tanzania for its achievements in increasing trade within the bloc.

“Kenya was the leading country in terms of goods and services that we trade in East Africa. Today, Tanzania has overtaken Kenya and I must commend Tanzania for the progress they are making, the numbers are growing of trade between our countries,” he said then.

Implications

While indicating that the trend is expected to continue, Mukhisa Kituyi warned that the mass exodus of investors is likely to exacerbate the unemployment situation in the country.

Besides unemployment, Mukhisa cautioned that the move would affect the economy unless lawmakers intervened to reverse the trend.

“It has been going it is just that those who man the political gate do not see the ramifications of that kind of phenomenon,” Mukhisa Kituyi affirmed.