By Benadeta Mwaura - Reporter
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Kenya, June 11, 2026 - Kenya’s economic strategy continues to place micro, small and medium enterprises (MSMEs), agriculture, and financial inclusion at the centre of its development agenda, as the government outlines a broad spending framework aimed at stimulating growth while managing a widening fiscal deficit.
Presenting the 2026/27 Budget Statement in Parliament, Treasury Cabinet Secretary John Mbadi framed the government’s fiscal approach as a balance between ambition and restraint.
“Mr. Speaker, our fiscal projections reflect a careful balance between ambition and realism, ensuring that we live within our means while investing in our future,” Mbadi said.
The government underscored the central role of MSMEs in employment creation and economic resilience, noting that they account for the overwhelming majority of enterprises in the country.
“MSMEs are the backbone of our economy: they account for 98 percent of businesses, provide approximately 14.9 million jobs, and contribute about 40 percent to GDP,” Mbadi told Parliament.
To strengthen the sector, the Treasury has proposed targeted interventions aimed at improving access to finance and entrepreneurship support systems.
“Lack of affordable credit remains a major constraint for MSMEs and households at the bottom of the pyramid,” Mbadi said.
To address this challenge, the government has proposed KSh 550 million for the Centre for Entrepreneurship Project to support incubation and business development services, alongside KSh 1.1 billion for a Rural Kenya Financial Inclusion Facility designed to expand access to credit in underserved communities.
Agriculture remains a core pillar of the Bottom-Up Economic Transformation Agenda (BETA), with the government allocating KSh 64 billion to boost productivity, resilience, and value chains across the sector.
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“Mr. Speaker, agriculture remains central to BETA and Kenya’s long-term prosperity. It supports more than two-thirds of Kenyan households and generates significant employment multiplier effects,” Mbadi said.
Key allocations include KSh 18 billion for fertilizer subsidies, KSh 2 billion for seed subsidies, and KSh 1 billion for coffee seedlings, aimed at lowering production costs for farmers. Additional funding has been directed toward value addition, food security, and climate resilience programmes.
Kenya is also considering tapping new capital markets through instruments such as Samurai Bonds in Japan and Panda Bonds in China, aimed at broadening funding sources and improving debt portfolio resilience.
The Treasury emphasised that Kenya’s long-term development strategy is increasingly anchored on domestic capital mobilisation and private sector participation.
“By mobilizing domestic savings and channeling them into productive investments, we are creating a model of growth that is owned, financed, and sustained by Kenyans,” Mbadi said.
He concluded by positioning the country’s development agenda as one driven by internal capacity and long-term structural transformation.
“Kenya is not just open for business - Kenya is investing in itself.”