The Toxic Business Environment In Kenya: Why Ruto’s Government Is the Root Of The Economic Malaise

Kenya once held promise as a beacon of business opportunity in Africa, a gateway to East Africa’s growing market. Today, however, the reality couldn’t be further from that dream. Businesses, both local and foreign, are quickly learning that venturing into Kenya’s current political and economic landscape is nothing short of a perilous journey, littered with barriers placed deliberately by the very government that should be fostering growth. In particular, Ruto’s administration has exhibited actions and policies that have left business owners frustrated, overburdened, and abandoned. The toxic atmosphere being created is pushing away genuine business opportunities, and it is the Kenyan people who suffer most in the end.

Corruption runs rampant, deeply rooted in every governmental layer, making it nearly impossible for an honest entrepreneur to make strides. To start a business in Kenya today, one is expected to grease the wheels of bureaucracy at every turn—licenses, permits, tax compliance—all come with an additional price tag that has nothing to do with government fees. This systematic culture has only worsened under Ruto’s government, which has shown no meaningful effort to curtail it. Instead, they foster a mindset that rewards the corrupt, while punishing those who attempt to follow the law.

Read Also: Kenya’s Global Humiliation: The UNSC Bid That Exposed A Nation’s Hypocrisy

It has become glaringly evident that to survive in Kenya’s business environment today, one must either play along with the corrupt system or face the harsh reality of slow progress, setbacks, and a constant barrage of financial penalties. This forced compliance has made many lose hope in building enterprises here, forcing honest businesses out of the market while leaving room for corrupt and powerful enterprises to thrive. Ruto’s government has left the regulatory mechanisms intentionally weak, allowing allies and those willing to pay their way to operate unchecked, while legitimate businesses are sidelined.

For any business looking to thrive in Kenya, consistent electricity and stable infrastructure are essential. Yet, under the current administration, these basics have turned into luxuries. Power outages are rampant, and accessing stable infrastructure feels like a distant dream. It’s ironic that in a country seeking foreign investment and development, the state has been unable to ensure steady power—a basic requirement for industries to operate effectively. The government’s misallocation of resources in favor of grandiose projects rather than upgrading core infrastructure has only deepened this crisis. When the very power to run a factory is sporadic, businesses face uncountable losses, and productivity plunges.

Ruto’s government has also shown a penchant for over-regulation in some sectors while neglecting others. Rather than offering support to budding businesses, the administration has imposed arbitrary rules and restrictions that feel more like deterrents than facilitators. Take, for example, the introduction of multiple, overlapping tax policies that have not only confused but also burdened business owners. These tax laws, often poorly thought out and inadequately communicated, serve as traps that squeeze every last coin out of entrepreneurs and businesses, creating an environment that punishes compliance while rewarding evasion. Ruto’s administration seems more focused on extracting as much revenue as possible from businesses, even if it means crippling them.

Read Also: Kenya’s Global Humiliation: The UNSC Bid That Exposed A Nation’s Hypocrisy

The judiciary, which should serve as a sanctuary for aggrieved businesses seeking justice, has itself been compromised. Delays, favoritism, and political interference are now the norm, leaving little hope for businesses that face unfair treatment. For those seeking fair arbitration, the process has become nothing but a mirage. Cases involving government interests or those of powerful allies are often fast-tracked or quietly dismissed, while legitimate disputes brought forward by struggling business owners are shelved. When justice can no longer be relied upon, the foundation of trust in doing business crumbles, and Kenya’s business environment becomes a hostile zone where might triumphs over right.

Investment incentives promised by the government often appear on paper but are nonexistent in practice. The very investors targeted by these promises are later slapped with countless fees, fines, and hidden charges that make the benefits vanish. Meanwhile, connected entities benefit freely from duty waivers and tax reductions without contributing anything substantial to the economy. Ruto’s administration has been blatant in this selective application of incentives, sidelining those who genuinely seek to improve Kenya’s economic standing. This behavior sends a clear message that only those willing to play by corrupt rules can survive here, further discouraging legitimate investors.

The tax policies have been particularly devastating to small businesses. The government continues to raise Value Added Tax (VAT) on essentials, making the cost of goods unbearable for consumers and forcing businesses to raise prices. For small enterprises trying to make ends meet, this has been catastrophic. With lower consumer spending power, the demand for goods has plummeted, and many businesses are left struggling. The administration’s approach to taxation appears out of touch with the economic hardships faced by citizens. While Ruto’s allies evade taxes through loopholes and connections, the rest of the country shoulders the burden of an expanding tax regime that leaves businesses bleeding dry.

To compound this dire situation, Kenya’s foreign debt is skyrocketing, draining the economy of resources that could otherwise support local business. Ruto’s government has continued to borrow recklessly without transparent plans for repayment or sustainable development. As the debt burden mounts, Kenyans are bracing for higher taxes, stricter regulations, and a depreciating shilling. The currency’s volatility alone has driven numerous foreign investors away, as the returns on investment continue to dwindle against an unstable currency. For a government that prides itself on economic prowess, this irresponsible borrowing and poor financial planning reveal an administration focused more on immediate self-gain than on long-term stability.

Trade policies have also failed the local market. Rather than protecting local industries, Ruto’s administration has opened the floodgates to cheap imports that compete unfairly with local businesses. These imports often come from allies’ countries and arrive tariff-free, devastating sectors such as agriculture and manufacturing, which once formed the backbone of Kenya’s economy. With local producers unable to compete with cheap foreign goods, industries are crumbling, jobs are lost, and businesses that have survived for generations are being forced to close their doors. This unrestricted importation policy has enriched a few but has dealt a severe blow to local businesses trying to remain afloat.

Nepotism and favoritism have further complicated the business environment. Contracts and government tenders are regularly awarded to individuals connected to the ruling elite, disregarding merit or competence. For businesses that do not have the right connections, these lucrative opportunities remain inaccessible. The government’s disregard for fair competition has stifled innovation, leaving room only for those close to the political elite to thrive. This environment has disillusioned many young entrepreneurs who dream of succeeding based on their talents but find themselves cut off by a system that demands loyalty over ability.

Ruto’s administration has also failed in protecting intellectual property rights, which are critical for fostering innovation and entrepreneurship. Piracy and counterfeiting thrive, often with the complicit knowledge of authorities. Creators and innovators are left with no recourse, watching as their ideas are stolen or replicated by competitors without consequence. The message is clear: this government does not value or protect innovation, instead allowing piracy to flourish while stifling genuine enterprise.

Read Also: The Devil’s Anus: How Corruption, Theft, And Incompetence Have Made Kenya Hostile To Honest Business

The cost of compliance for businesses in Kenya is astronomical. Beyond taxes and licensing fees, there are “unofficial” charges that business owners must navigate. Many times, government officials expect “facilitation fees” to approve simple processes, creating yet another drain on already strained businesses. These practices have intensified under Ruto’s rule, where the culture of expecting a bribe for services has been normalized. The administration’s blind eye to this corruption has turned government offices into hostile environments where genuine business owners are exploited at every turn.

One of the most telling signs of a failing business environment is the migration of Kenyan entrepreneurs to neighboring countries. Tanzania, Rwanda, and even Uganda are now becoming safe havens for entrepreneurs who once saw Kenya as a natural home for growth. This brain drain is a direct result of the inhospitable environment created by Ruto’s administration, which has not only failed to protect but actively driven away some of Kenya’s brightest business minds. When a country’s own people no longer feel they can safely invest in their homeland, it reflects the depth of dysfunctionality in the governing regime.

In truth, the message that Ruto’s government has sent to investors and business owners alike is resoundingly negative. By failing to provide a conducive environment, enforcing a culture of corruption, mishandling foreign policy, and putting personal interests above national progress, they have singlehandedly created a business climate where only the powerful and corrupt can flourish. Honest businesses face not just challenges but a systemic campaign against their success, deterring genuine investment and stalling the economy.

This government has failed Kenyans by turning a once-promising economy into a hostile zone for business. The administration’s toxic policies, selective incentives, and rampant corruption have made doing business in Kenya not only difficult but perilous. While government officials and their allies enjoy untouchable privileges, the rest are left to navigate a system designed to exploit and frustrate. In Kenya’s current environment, the honest entrepreneur’s journey has become an uphill battle—one that many are unwilling to face. For the business community, Ruto’s administration has truly been the undoing of Kenya’s economic promise.

Read Also: Ruto’s Theater of Corruption: Preaching Water While Guzzling Wine