World Bank flags land corruption and power costs as barriers to Kenyan investment

A World Bank assessment has identified bribery, fraudulent land records and illegal land allocations as significant obstacles for businesses and households trying to acquire, register and own property in Kenya, with knock-on effects for construction and real estate development.

The assessment says nearly 31 per cent of foreign-owned firms surveyed regard access to land as a major business constraint. It also finds that electricity costs for Kenyan businesses are substantially higher than in regional and comparator markets, at almost 50 per cent above Uganda and more than 124 per cent above Vietnam.

For developers, the land findings matter at every stage of a project. Reliable title documentation is needed to acquire a site, secure financing and apply for construction approvals, and competing or fraudulent ownership claims can delay or derail those processes. The World Bank links part of the problem to weaknesses in records and allocation procedures rather than to the cost of land itself.

On power, the assessment associates part of Kenya's electricity cost burden with weaknesses in procurement and in the transparency of power purchase agreements, the contracts that set pricing, supply obligations and payment terms between generators and buyers. Opaque or uncompetitive contracting can feed through into the tariffs paid by commercial buildings, industrial facilities and construction-material producers.

Kenya is pursuing investment in transport infrastructure, industrial development, housing and energy generation, all of which depend on predictable legal, regulatory and financial arrangements. The assessment points to the reliability of land ownership systems and the affordability of electricity as two tests of how smoothly those projects can move from site acquisition to operation.