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November 3, 2016

Report: Lack of defined policy and regulations in Kenya limit opportunities for foreign OEMs

Kenyan defence imports are anticipated grow over the next five years as the nation intends to acquire military equipment and systems from Russia and China, creating limited opportunities for foreign original equipment manufacturers (OEMs), says a report by Strategic Defence Intelligence (SDI).

Kenyan defence imports are anticipated grow over the next five years as the nation intends to acquire military equipment and systems from Russia and China, creating limited opportunities for foreign original equipment manufacturers (OEMs), says a report by Strategic Defence Intelligence (SDI).

Titled, “Future of the Kenyan Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2021”, the report offers insights of the Kenyan defence industry trends during the period between 2017 and 2021.

Kenya majorly relies on imports as it lacks advanced weapon manufacturing facilities, which creates new opportunities for foreign original equipment manufacturers (OEMs) to enter the country through defence equipment procurement contracts.

"A lack of defined offset policies and foreign direct investment (FDI) regulations, however, limit the foreign firms to cater to the Kenyan defence industry."

The nation imported aircraft, vessels, armoured vehicles, and engines from 2011 to 2015, and plans to buy CBRN detection equipment, helicopters, armoured vehicles, unmanned aerial vehicles (UAVs), aircraft and surveillance equipment in the future.

A lack of defined offset policies and foreign direct investment (FDI) regulations, however, limit the foreign firms to cater to the Kenyan defence industry, adds the report.

Far-flung corruption, misconducts and delays in the execution of contracts too hinder the entry of foreign companies, while low defence budget of the nation further makes the industry unattractive for foreign OEMs.

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