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Home > Business & Finance > Special Economic Zone roars to life as sh. 57 billion investments line up for its piece

Special Economic Zone roars to life as sh. 57 billion investments line up for its piece

The government’s commitment to operationalize the multi-billion shilling Naivasha Special Economic Zone [SEZ] has borne fruit after Sh. 57 billion worth of investments line up for development.

The multi-billion zone has been established by the government as a SEZ and sits on a 1,000-acre piece of land aimed at driving the country’s industrialization agenda.

The Naivasha SEZ located in Mai Mahiu area has been termed as a gateway to the East African countries and the wider Eastern and Central Africa region and the government has pumped billions of shillings for its development.

To speed up investment in the zone, the government has so far spent billions of shillings to support development of key infrastructures including Inland Container Depot, railway marshaling yard and a logistics zone.

The government has also spent more than Sh 1 billion to drill and equip five boreholes from Naivasha town to provide treated water to the zone as well as developing key access roads.

The zone, favored for its proximity to the geothermal power wells in Olkaria, has now attracted five investors who seek to inject more than Sh. 57 billion to develop industries in the area.

The crucial investments from Jumbo AAA limited, Jafro SEZ, Turkish Industry Holdings, Sino Excellence and Eriken MFG limited will help boost Foreign Direct Investment and support economic recovery and job creation.

The Special Economic Zone Authority said it has so far signed lease agreements with three investors and issued letters of offer to two others to establish industries at the zone.

The authority said the investors have lined up for investments ranging from sectors in iron and steel, textile, apparels and leather, paper and paper products, cold storage facilities and industrial warehousing.

The government has introduced certain incentives to woo investors to the special zones such as exemption of Value Added Tax on supply of goods or taxable services.

Investors will also pay corporate tax at 10 percent for the first 10 years of operations, 15 percent for the next 10 years and 30 percent for the subsequent years.

Members of the National Assembly Departmental Committee on Trade, Industry and Cooperatives during an inspection tour of the Naivasha Special Economic Zone to assess its progress. Photo by Erastus Gichohi

According to the Authority Chair Ngenny Biwott, the government will issue long leases to 700 acres to investors while 300 acres will be reserved for greening and recreational purposes.

“75 percent of the zone space has so far been occupied and the authority seeks to accelerate the operations by September this year to enhance operationalization,” said Biwott.

Biwott said the presence of Standard Gauge Railway linkage, proximity to cheaper geothermal power and zone strategic location makes it more attractive for both local and international investors.

The government has committed to provide cheaper power tariffs to spur up investments offered at a rate of sh.5 per unit that will make the cost of manufacturing reduce drastically.

Biwott said the investors will also support development of key infrastructures such as housing, schools, and health facilities within the zone.

Biwott was responding to queries from members of National Assembly Departmental Committee on Trade, Industry and Cooperatives during an inspection tour of the facility in Mai Mahiu.

According to the Committee Chair James Gakuya the special zone needs Sh. 4.5 billion to ensure completion of key infrastructure linkages including more power and water connection and access roads.

Gakuya termed the special economic zone a game changer that will turn around the fortunes for the government while creating thousands of direct jobs for youths.

He called on the zone authority to address any roadblocks that may hinder ease of investing in the country adding that Kenya must leverage on its position as destination of choice for investors.

Gakuya also called on neighboring countries whose governments gave free land around the zone to fast-track their operations noting that they seek to benefit from the railway linkage already in place.

On her part, the committee Vice Chair Maryanne Keitany said they will support more funding of sh.2.5 billion in the coming financial year to ensure completion of remaining projects.

By Erastus Gichohi

 

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