By Benadeta Mwaura - Reporter
Kenya, July 24, 2026 - The Kenyan government is positioning artificial intelligence (AI) as the next engine of enterprise growth, unveiling plans to integrate the technology into the country's micro, small and medium enterprises (MSMEs) as businesses increasingly adopt digital tools to boost productivity, reduce costs and compete in regional and global markets.
Speaking during the Third Annual SME Conference, Awards and Exhibition organised by the Kenya Private Sector Alliance (KEPSA), Principal Secretary for the State Department for Micro, Small and Medium Enterprises Development Susan Auma Mang'eni said Kenya is no longer viewing AI merely as an emerging technology but as a strategic economic asset capable of transforming how businesses operate.
"Our strategy is to see how best we can mainstream AI in our productivity, in our competitiveness and in the efficiency of our work environment."
"We have that strategy to support it, and to me that shows that we are ready. It will not find us unprepared," Mang'eni said.
While artificial intelligence has largely been associated with multinational corporations and technology giants, the government now wants Kenya's nearly eight million MSMEs to become active participants in the AI revolution.
According to Mang'eni, AI has the potential to help small businesses automate routine processes, improve inventory management, enhance customer service, analyse markets, reduce operating costs and unlock new revenue streams.
The strategy also seeks to position manufacturers to produce higher-value products and improve competitiveness under the African Continental Free Trade Area (AfCFTA).
She noted that Kenya's mature digital ecosystem, built on widespread mobile money adoption, internet connectivity and a vibrant innovation culture, provides a strong foundation for mainstreaming artificial intelligence across multiple sectors.
Unlike many countries that have focused primarily on regulating AI, Kenya is taking a dual approach by simultaneously developing governance frameworks while encouraging adoption across businesses and public institutions.
The government has already developed a National Artificial Intelligence Strategy, aimed at supporting enterprises and entrepreneurs in integrating AI into their operations responsibly.
Alongside the strategy, investments are being directed toward digital infrastructure, fibre connectivity, innovation hubs and entrepreneurship programmes such as the National Youth Opportunities Towards Advancement (NYOTA) initiative.
The AI push complements broader reforms targeting MSMEs, including the recently launched Revised MSME Policy 2026, which seeks to improve access to finance, markets, innovation and technology adoption for small businesses.
The announcement comes just days after government officials called for greater investment in Kenya's own AI infrastructure, including cloud computing, research facilities, data centres and local engineering talent, to reduce dependence on foreign technologies.
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Principal Secretary for Science, Research and Innovation Shaukat Abdulrazak recently argued that Africa must move beyond being a consumer of imported technologies.
"Africa cannot remain only a consumer of technology. We must invest in research, protect our innovations and build technologies that create industries, businesses and jobs," Abdulrazak said.
Industry leaders have similarly proposed establishing AI innovation hubs that connect universities, startups, investors and technology companies to accelerate commercialisation of locally developed solutions.
Analysts say Kenya's AI ambitions come at a time when businesses worldwide are rapidly embracing generative AI to automate operations, improve customer engagement and enhance decision-making.
However, they caution that successful adoption will depend on addressing several challenges, including digital skills gaps, cybersecurity, affordable computing infrastructure and a regulatory framework that encourages innovation without placing excessive compliance burdens on startups and MSMEs.
The proposed Artificial Intelligence Bill, 2026, currently before the Senate, is expected to provide Kenya's first comprehensive legal framework governing AI deployment while balancing innovation and consumer protection.
For the government, integrating AI into MSMEs forms part of a broader vision of transforming Kenya into a regional innovation powerhouse.
Officials believe combining artificial intelligence, entrepreneurship and value addition will strengthen Kenya's competitiveness in regional and international markets while creating new jobs and industries.
As global competition increasingly shifts from labour-intensive production to knowledge-driven economies, Kenya is betting that artificial intelligence will become the next frontier of economic transformation, not just for large corporations, but for the millions of small enterprises that form the backbone of the country's economy.