Hope for jobs as Sh200b Eldoret private industrial park kicks off

Former Kipchamo chief George Tarus points at a signage indicating where the Africa Economic Zone (AEZ) was to be built in Uasin Gishu County at Kipchamo location. [File, Standard]

Construction of a multi-billion-shilling industrial park aimed to transform the North Rift region into a major commercial hub has kicked off again.

The project faced delays due to lack of clarity on related policies including access to incentives as well as lack of water and poor road connectivity, said its backer.

Businessman David Lang’at told The Standard that President William Ruto’s government support had unlocked the delays in the implementation of the Sh200 billion Africa Economic Zones Ltd (AEZ) project.

The investment, founded by Mr Lang’at – chairman of the DL Group of Companies – was meant to develop and operate the first private special economic zone (SEZ) in the North Rift region.

It was launched almost six years ago at the Plateau area, some 40 or so kilometres from Eldoret town, Uasin Gishu County.

It had stalled due to SEZ policy challenges on market access; the slow process of negotiations to come up with the East African Community SEZ Policy and regulations for the establishment of SEZs as well as the poor state of the surrounding road and an acute water shortage.

“We have seen that the new government has initiated the process of upgrading the road to access the industrial park from the A104 Nakuru-Eldoret highway and started to build the road in earnest,” Mr Langat said.

“We are also hopeful as the government is trying to give a temporary measure of water from a nearby dam.”

He said infrastructure works within the park will cost up to Sh5 billion.

“Hopefully by January, we will be able to be up and running.”

Work at the park had also been delayed by inadequate power, which will be complemented by a newly completed solar park with an output of 94 megawatts to supply electricity to businesses at the park.

Lang’at said he is now negotiating with potential investors for the park.

The project will be undertaken in three phases, with the first dubbed SISIBO SEZ AEZ Pearl River sitting on a 700-acre site and targeting agro-processing, energy, machinery, engineering, construction, assembly, electronic, ICT, chemical and pharmaceutical industries.

“The project will create 50,000 jobs directly and support an additional 150,000-50,000 farmers and youth indirectly,” Langat said.

He said the Finance Act 2023 had enhanced regional market access, expanded and simplified tax incentives for investment in SEZs in a bid to attract investment into those zones.

The amended Section 4 of the Special Economic Zones Act, 2015, states that “development of zone infrastructure and goods introduced in customs-controlled area are exempted from customs duties in accordance with customs laws.”

“Goods whose content originates from the customs territory shall be exempt from payment of import duties, and goods whose content partially originates from the customs territory shall pay import duties on the non-originating component subject to customs procedures.”

The SEZs are designated areas aimed at promoting and facilitating export-oriented investments as well as import substitution.