Biden warns graft hampering American investments in Kenya

President William Ruto and the President of the United States of America Joe Biden during a joint Press Conference at the White House, Washington, D.C on May 23, 2024. [PCS, Standard] 

The United States (US) President Joe Biden’s administration, led by his Trade Representative Katherine Tai, has raised concerns about the persistent corruption in Kenya, which it believes is hindering American investments in East Africa’s largest economy and a strategic ally of Washington.

Despite Kenya’s status as an Agoa (African Growth and Opportunity Act) eligible country and its efforts to maintain a market-based economy and attract huge foreign direct investments, the Office of the US Trade Representative (USTR) pointed to corruption as a major barrier to American businesses looking to expand their footprint in the Kenyan market.

“Corruption remains one of the most significant barriers to doing business in Kenya, with US firms reporting that they find it difficult to compete with companies willing to ignore legal standards or engage in bribery and other forms of corruption,” the USTR stated in a newly published report.

It noted Kenya’s ranking of 126 out of 180 countries in Transparency International’s 2023 Corruption Perception Index underscores the scale of the challenge facing President William Ruto’s government, which has pledged to tackle graft as a key priority.

The Biden administration, through the USTR, has made anti-corruption a central pillar of its foreign economic policy. Kenya’s struggles in this area have become a source of concern in Washington. “While Kenya has an independent judiciary and guarantees political pluralism, the continued prevalence of corruption is hindering the country’s ability to fully capitalise on its economic potential and attract the kind of high-quality US investment that could drive sustainable development,” the USTR report said.

The launch of the US-Kenya Strategic Trade and Investment Partnership previously, and President Ruto’s State visit to Washington earlier this year were seen as a positive step, with both sides committing to reforms that would create a more attractive environment for foreign investment.

However, progress on addressing corruption has been slower than hoped, according to US officials. As Kenya works to implement its various economic programmes, the Biden administration is urging Nairobi to redouble its efforts to combat graft and create a level playing field for American businesses.

“The government of Kenya continues its public campaign to combat corruption and its anti-corruption agencies appear to be coordinating more effectively, including bringing cases against government officials,” the USTR report stated.

“Despite progress, corruption remains one of the most significant barriers to doing business in Kenya, with US firms reporting that they find it difficult to compete with companies willing to ignore legal standards or engage in bribery and other forms of corruption.”