Kenya is under rising pressure from the European Union to fix its corruption crisis and improve its unstable business environment.
As the country celebrates a new trade deal with Europe, EU leaders are making it clear that reforms must follow fast.
In a candid interview, EU Ambassador to Kenya Henriette Geiger warned that Kenya risks losing its edge to regional competitors like Tanzania and Rwanda if it does not act now.
The message is blunt: clean up corruption, stabilize policies, and make Kenya a real trade powerhouse.
EU Pushes Kenya to Curb Corruption and Policy Instability to Strengthen Trade Relations
The European Union has stepped up its demands for Kenya to clean house. Speaking to Bloomberg, Ambassador Geiger said Kenya’s business and investment climate is currently “not very favorable.”
Corruption scandals, frequent policy shifts, and unpredictable tax regimes are scaring away investors and weakening the country’s competitiveness.
“Others are not sleeping. Tanzania, Rwanda, and Uganda are catching up fast,” Geiger warned. “Kenya is resting a bit on its laurels.”
This push comes as the two sides begin implementing a landmark Economic Partnership Agreement (EPA) signed in May 2024. The deal grants Kenya duty-free and quota-free access to European markets, but it also comes with expectations.
The EU wants to see real reforms, not just promises. Geiger stressed that for Kenya to enjoy the full benefits of the EPA, it must fight graft aggressively and stabilize its laws.
She pointed to other nations that signed EPAs and saw massive jumps in trade volumes. Kenya could follow suit — but only if it creates a fair, transparent business environment.
Trade between Kenya and the EU hit €3.4 billion (Ksh 500 billion) in 2023, a 53 percent increase over the past decade.
Yet Kenya imported €2 billion and exported only €1.4 billion, mainly in agricultural goods like vegetables, fruits, and flowers. The EU wants to see Kenya diversify its exports beyond farming.
Graft and Bad Policies Are Holding Kenya Back
Kenya’s corruption problem has been a long-running obstacle to economic growth. International reports consistently rank Kenya as one of the more corrupt countries in Africa.
Government projects often suffer from inflated costs, tender manipulation, and lack of transparency. Frequent changes in laws and tax policies make things worse.
Investors often find themselves caught off guard by sudden shifts that eat into their profits. The business community has repeatedly called for a stable and predictable policy framework, but little has changed.
By demanding reforms, the EU is putting Kenya’s leaders on notice. The new EPA includes strong provisions for transparency, labor rights, and environmental protection.
It also has a clear dispute resolution mechanism, meaning the EU can hold Kenya accountable if it backslides.
If Kenya fails to tackle corruption, it risks not only losing European investments but also falling further behind its East African neighbors.
Tanzania and Rwanda are already attracting more foreign businesses by offering more stable and less corrupt environments.
EU Warns Kenya Risks Losing East Africa Leadership Without Urgent Action on Corruption
Despite the strong words, the EU still sees Kenya as a vital partner. Ambassador Geiger said the country has huge potential to become a trade and investment hub if it takes the right steps.
The EPA could open doors to new industries, new markets, and massive job creation. For this to happen, Kenyan businesses and government must work together.
Geiger urged local companies to form alliances, explore new business ideas, and diversify their products beyond agriculture.
“We need to make sure that the economic operators are putting their heads together and forming new alliances, looking at new business opportunities,” she said.
President William Ruto has praised the EPA as a game-changer for Kenya. He has promised that the government will work to create a more attractive investment environment. But now, with the EU watching closely, those promises must turn into real action.
The EPA is open for other East African Community (EAC) countries to join, which means Kenya cannot afford to be complacent. If it does not act fast, it could find itself overtaken by its neighbors in the race for European trade and investment.
The pressure is on. The opportunity is huge. But without fighting corruption and stabilizing its policies, Kenya risks turning a golden chance into a missed one.
