The Chairman of the Entrepreneurs Society of America has told investors in Nairobi that growth in the Kenyan economy will be driven by small and medium enterprises (SMEs).
Speaking at the Entrepreneurs Summit, Karl Gibbons added that while blue chip companies continue to be attracted to Kenya, only small business will grow the economy.
“The Kenyan economy will be driven by the guy or the girl who starts their own business, will probably never do a million dollars a year and will have less than five employees and they will be 80 per cent of the economy,” he said.
According to the Central Bank of Kenya, around 46 per cent of SMEs in Kenya cease trading within 12 months, with another 15 per cent in the following year. To address this, Gibbons urged the government to continue investing in ease of doing business especially for small business in a bid to generate growth.
Inadequate capital, limited market access, deprived and unsupportive infrastructure, inadequate knowledge and skills and rapid changes in technology are all factors that hinder Kenyan SMEs.
Continuing his address, Gibbons said: “Kenya should focus on creating a good environment for small businesses to thrive, some of these small businesses could end up being big corporations,” before adding that American investors are keen on investing in Africa.
Gibbons also spoke to entrepreneurs in Mombasa on Wednesday at an event organized by Sprinter Real Estate Limited.