UAE fund unveils Sh3.5bn investment deal in Kenya

President Uhuru Kenyatta with Dubai Minister Sheikh Nahyan bin Mubarak Al Nahyan. Photo | PSCU

The Khalifa Fund for Enterprise Development (KFED), backed by the government of the Emirate of Abu Dhabi, has announced its first investment in Kenya of US$30 million (Sh3.57 billion).

The UAE Fund launched a local innovation and entrepreneurship hub in February with an eye on deals in Kenya.

The Abu Dhabi state-backed fund said the funding will be provided through the Kenya Youth Enterprise Development Fund.

It added that the funds are aimed at providing early-stage funding to promising start-ups and founders. It is unclear whether the funding is a loan or a grant.

“More than 3,000 projects will be funded, 40 percent of which will be allocated to women, and are expected to create nearly 13,000 jobs for Kenyan youth,” KFED said.

The fund said on its website that it had disbursed Sh40.8 billion (Dh1.32 billion) in loans.

It earlier said it would help fund, train Kenyan SMEs and connect them with investors.

Raising start-up capital and entering the market are some of the biggest challenges facing emerging Kenyan entrepreneurs, and banks need collateral that most of them don’t have, a past study showed.

The Kenya Youth Enterprise Development Fund was established in 2006 to provide loans to youth-owned businesses.

In a statement, KFED announced: “Khalifa Fund for Enterprise Development of the Republic of Kenya and the Ministry of Finance and Planning of the Republic of Kenya have signed a financing agreement of AED 110 million (US$30 million) to enhance the capacity of the Kenya Youth Enterprise Development Fund. .”

“The agreement, signed by KFED CEO Alia Al Mazrouei and Cabinet Secretary Ukur Kanacho Yatani in the Ministry of Finance and Planning in the presence of Kenyan President Uhuru Kenyatta, aims to promote entrepreneurship and develop SMEs in Kenya.”

The Khalifa Fund was established by the Abu Dhabi government in 2007 with a total capital of Sh61.9 billion (US$545 million).

“Our goal is to support the Kenyan government’s efforts to achieve economic development by strengthening the SME sector and to spread a culture of entrepreneurship among youth and women’s empowerment,” said Alia Al Mazrouei, CEO of KFED.

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