Why Kenya's private sector should invest in refugee economies for growth

**Refugees sell their products during the World Refugee Day at Kalobeyei Sports Complex in Turkana County on June 20, 2024** [Boniface Okendo, Standard]

Across East and Central Africa, nearly 44 million people are forcibly displaced — not just as a tragic headline, but as an overlooked economic force reshaping labour markets, local economies, and cross-border trade.

This figure, driven by conflict, climate shocks, and political instability, places Uganda (with over 1.6 million refugees) and Kenya, Ethiopia, and the DRC among the continent’s top host nations.

Yet despite this, displaced communities remain largely invisible in national economic plans, corporate strategies, and public investment priorities.

This exclusion is a wasted opportunity - not just a humanitarian concern but a business one, costing national economies untapped markets and new consumer bases.

We need practical action and mindset shifts across sectors. This involves reflection, cross-sector dialogue, and honest recognition that old assumptions no longer work.

For the public sector, it means reevaluating how national resources are used - moving beyond short-term aid to invest in market-based development.

For the private sector, it means seeing refugee markets not as charity cases or risky side bets, but as bold growth frontiers. Globally, businesses that venture early into frontier spaces often reap outsized rewards.

Look at Equity Bank in Kenya: by expanding financial services to reach low-income, rural, and marginalized populations - including refugees - it has built one of Africa’s most inclusive banking models. Equity proves that investing in underserved markets drives both commercial success and social impact.

Companies that step up now to serve refugee and host markets can create new customer bases, test innovative business models, and strengthen their positions in the mainstream economy.

In Kakuma and Kalobeyei alone, a 2018 IFC study valued the refugee market at over USD 56 million annually. Yet most refugee-led businesses remain locked out of formal financial systems due to restrictive policies, lack of credit history, or perceived risk. Over 70% of small enterprises in Uganda’s settlements lack access to working capital, stalling their potential.

Take Lucy, a refugee entrepreneur in Kakuma. Once dependent on aid, she now runs a thriving tailoring business, employing fellow refugees and serving local host community customers. Vocational training, market linkages, and small capital helped her transform from an aid recipient to an economic driver. Lucy’s story shows the power of unlocking local talent and initiative when systems align.

Yet market opportunities don’t exist in a vacuum. Fragile governance, security threats, and shifting refugee policies shape both risks and rewards.

In Kenya, new laws like the Refugees Act of 2021 and regional commitments under the Nairobi Declaration create openings for the private sector to play a bigger role. But cross-border conflict, especially in places like the DRC or South Sudan, complicates expansion.

Meanwhile, big geopolitical shifts - from EU migration deals to Gulf investments in African infrastructure- are reshaping the landscape and influencing who gets access.

Kenyan businesses, sitting at the heart of East Africa’s economic engine, have a unique chance to shape and lead in this space.

But bold business in fragile settings comes with real ethical stakes. Without safeguards, market engagement risks reinforcing inequalities or enriching elites. Who ensures companies deliver fair outcomes? What governance models - local cooperatives, blended boards, community accountability mechanisms- make sure displaced people have a meaningful voice and share in the value created?

INGOs and donors must shift from charity to catalytic roles, de-risking private investment and brokering partnerships that include fairness and accountability.

We’ve already seen glimpses of success. In Nakivale, local agribusiness partnerships are boosting incomes. In Turkana, waste entrepreneurs are converting organic waste into biofuel. In DRC and Mozambique, vocational centers link youth to formal jobs. And in Uganda, the recently concluded Uthabiti project deliberately engaged refugees and host communities to co-create value chains, ensuring benefits were shared and tensions reduced.

Here’s the challenge for Kenyan businesses: Will they lead? Kenya currently hosts over 650,000 refugees and asylum seekers - one of Africa’s largest displaced populations- alongside an economy growing at over 5% annually. Kenya has long positioned itself as East Africa’s innovation hub, from fintech to agribusiness.

Refugee and host community markets offer the next frontier for bold, scalable growth. If local firms seize the moment, they can expand customer reach, test new solutions, and strengthen their national and regional influence, while helping build a more inclusive economy.

What’s needed now is not token CSR but forward-looking alliances - platforms, networks, and partnerships that bring government, private sector, and civil society together to drive real, sustained system change. It’s courage, creativity, and commitment - across all sectors - to build a shared prosperity in places too long overlooked. The question is no longer whether Kenya’s private sector can lead; it’s whether it will.

-Ms Nyawira is a communications practitioner working on inclusive economic development and private sector engagement across East and Central Africa.