NAIROBI, December 12, 2023 — The World Bank has approved the Kenya Jobs and Economic Transformation Project (KJET) to benefit at least 45,000 Kenyans, including at least 6,800 women through new or improved job opportunities. KJET aims to increase private sector investments, access to markets and sustainable finance to create and improve jobs.
The project is designed to support Kenya Jobs and Economic Transformation (JET) agenda. With $150 million in financing, KJET will provide business development services aimed at strengthening viable value chains and connecting micro, small, and medium enterprises (MSMEs) to markets, in addition to investments in firms for the improvement of productive capacity and capabilities. In turn, these activities will enhance firms’ capacity and efficiency, translating to increased hiring and improved worker productivity.
“The project supports the achievement of the World Bank’s mission of ending extreme poverty on a livable planet,” said Keith Hansen, World Bank Country Director for Kenya, Rwanda, Somalia and Uganda. “It will focus on empowering the private sector, driving job creation, and catalyzing green investments by private investors in member countries.”
The Jobs and Economic Transformation (JET) agenda is a focus area in the Government of Kenya’s Vision 2030, its fourth Medium-Term Plan (MTP4, 2023-2027), and the new Bottom-Up Economic Transformation Agenda, which set ambitious development targets that will require significant growth in private sector employment generation and productivity. Vision 2030 aims to transform Kenya into a newly industrialized, globally competitive, middle-income country.
Beyond being a recipient of business development services and technical support, the private sector is expected to invest capital into the blended finance Green Investment Fund as well as through a novel co-investment model financing MSMEs’ productive capacity. In all, the project is expected to mobilize at least $27 million in private capital to complement the World Bank and the Government of Kenya’s investment.
“KJET offers a comprehensive set of interventions that are expected to support business and investment enabling reforms in Kenya that will result in streamlined licensing processes; improved investment-related laws, regulations, and strategies; enhanced government capacity for investor outreach and government to business service delivery,” said Ahmed Rostom, World Bank Senior Financial Sector Specialist and KJET Task Team Leader. “KJET will also focus on enhancing MSME cluster competitiveness through increased capabilities and productive capacity by extension sales, profits, and jobs at supported firms. It will also scale up green financing to improve SMEs adoption of green technologies to strengthen resilience to climatic shocks.”
Reflecting a whole-of-government approach, the project will be anchored within the State Department for MSME Development of the Ministry of Co-operatives and MSME Development and the State Department for Investment Promotion of the Ministry of Investments, Trade, and Industry. Under the oversight of the two State Departments, select further activities will be carried out by the Micro and Small Enterprises Authority (MSEA), Kenya Investment Authority (KenInvest), and Kenya Development Corporation (KDC).
Economic transformation in Kenya is underway, but the share of employment in low-productivity sectors and firms remains high, stifling livelihoods and limiting inclusive growth. Agricultural output as a share of GDP has declined, in parallel with output growth in the higher-productivity industrial and service sectors. However, this has not translated to high-quality jobs at scale, labor force participation decreased in recent years. Jobs remain concentrated in sectors with low labor productivity as job creation has not matched output growth in high-productivity sectors, and productivity growth has been limited in traditional sectors.
