TUKO.co.ke journalist Japhet Ruto has over eight years of experience in financial, business, and technology reporting and offers deep insights into Kenyan and global economic trends.

Over the past decade, Kenya has become a challenging environment for both local and foreign businesses.

Despite President William Ruto's promise to foster a more business-friendly climate, his 34 months in power have seen a rise in company closures and reduced operations.

This has resulted in job losses and diminished confidence in Kenya as an attractive investment destination for businesses seeking new opportunities.

This downturn has been caused by a combination of factors, including rising operational costs driven by high taxes, regulatory overreach and concerns about political instability.

According to the Federation of Kenya Employers (FKE), the increase in business costs in Kenya is attributed to tax measures, global geopolitical developments, and climate change

"Preliminary results show that between October 2022 and November 2023, we lost 3% (70,000) of the jobs in the formal private sector," FKE stated.

FX Pesa lead market analyst Rufas Kamau opined that unpredictable policies forced big multinationals to exit the local market.

"A nation with stable currency, taxation, and economic growth is a haven for the ultra-wealthy. However, the current administration's actions are slowing economic development by drastically altering tax policy," Kamau told TUKO.co.ke.

Due to the Central Bank of Kenya's (CBK) limited demand for printing notes, De La Rue left the Kenyan market.

The company's net profit from the Kenyan division dropped by 58%, from KSh 184.5 million to KSh 76.9 million.

In January 2024, the banknotes printer laid off employees, spending an additional KSh 258 million.

Business Daily reported that it spent £13.9 million (Ksh 2.4 billion) to shut down its Nairobi unit.

Citing economic challenges, such as high operating costs, CMC Motors Group withdrew from the Kenyan, Ugandan, and Tanzanian markets.

The company was one of Kenya's biggest automakers and had been providing farmers with mechanical and agricultural solutions.

More than 160 Kenyans lost their jobs as a result.

On Friday, December 20, 2024, Ukwala Supermarket Ltd concluded the liquidation procedure.

The supermarket filed for liquidation due to unpaid payments to suppliers and the Kenya Revenue Authority (KRA).

With assets of KSh 19 million, its debt had increased to almost KSh 1 billion.

After being placed under administration, the e-commerce company Copia stopped operating in six towns in June 2024.

The firm informed employees that it will no longer be accepting orders in Meru, Embu, Kericho, Eldoret, Machakos, and Naivasha as of May 29, 2024.

Due to harsh economic conditions made worse by high fuel prices and a weak shilling, Sendy encountered financial problems.

Peter Kahi of PKF Consulting (K) Limited was hired as the administrator.

With a monthly burn rate of about $1 million (KSh 129 million), the company was compelled to cease operations.

Kenyan B2B e-commerce company MarketForce closed its doors in four of its five markets in the East African Community (EAC) region and Nigeria.

MarketForce is the proprietor of the RejaReja smartphone application, which enables informal retailers to directly order fast-moving consumer goods (FMCGs) from manufacturers and distributors while also granting access to finance.

MarketForce's products are now offered in Uganda after the company decided to stop providing services in Kenya, Nigeria, Rwanda, and Tanzania.

Tala, on Thursday, April 17, announced that it had sent home 28 of its staffers in the customer service department.

At that time, Base Titanium announced that it would lay off 1,600 employees as it leaves the Kenyan market after operating for over a decade.

Other companies that have sent home workers include Twiga Food (which sent 250), Unga Group (which laid off 50), and CIC (which sent 75).

Source: TUKO.co.ke