The National Assembly has taken a significant step toward reshaping Kenya’s economic landscape after the Local Content Bill, 2025, sponsored by Laikipia Woman Representative Jane Kagiri, was formally read for the second time, triggering an animated and wide-ranging debate among lawmakers.
The proposed legislation, listed as Order No. 11 and officially titled National Assembly Bill No. 45 of 2025, seeks to establish a legal framework to regulate and promote the use of locally sourced goods, services, and labor across key sectors of the economy.
Moving the motion, Jane Kagiri described the Bill as a timely intervention aimed at reversing the growing trend of capital flight, underutilization of local capacity, and marginalization of Kenyan enterprises by multinational corporations.
In a passionate address, Kagiri underscored the urgent need to prioritize Kenyan producers and professionals, citing personal experiences and national statistics to illustrate systemic imbalances in procurement and investment practices.
She revealed that despite Kenya’s strong agricultural base, local farmers are often sidelined in favor of imports, even for basic commodities such as potatoes used in fast food chains. Kagiri questioned why multinational companies fail to engage local farmers through contract farming or skills transfer arrangements.
“We are producing enough locally, yet we continue to import what we can grow and manufacture ourselves,” she said.
The legislator further highlighted findings from investment and logistics reports showing that while Kenyans own up to 90 percent of trucks in the country, multinational firms still award the majority of transport contracts to foreign entities.
The Bill proposes several transformative measures, including, a requirement that at least 60 percent of goods and services procured by multinational companies be sourced locally.
A mandatory threshold of 80 percent Kenyan workforce in foreign companies, subject to potential revision upward following stakeholder input. Promotion of skills transfer and capacity building for Kenyan workers.
Prioritization of locally produced agricultural goods and establishment of a Local Content Compliance Authority to oversee implementation.
Kagiri noted that the Bill would come into force one year after enactment to allow adequate time for compliance.
She also proposed penalties for non-compliance, including hefty fines and possible imprisonment, though amendments under consideration favor a more regulatory and facilitative approach.
Central to the Bill is the concern over capital outflows. Kagiri cited data indicating that a significant portion of foreign direct investment inflows is repatriated, leaving minimal benefit for the local economy.
She argued that enforcing local content requirements could help retain billions of shillings annually, stimulate domestic industries, and create employment opportunities for the country’s growing youth population.
Drawing parallels with countries such as China, she emphasized the importance of enforcing technology transfer policies to build local expertise.
The motion received strong backing from several lawmakers who described the Bill as a potential “game changer” for Kenya’s economy.
Seconding the motion, legislators praised Kagiri’s research and advocacy, noting that the Bill addresses long-standing concerns about unequal participation in the economy.
Members cited examples of declining manufacturing sectors, including textile industries and agro-processing firms, attributing their struggles to unchecked imports and lack of supportive policies.
Others pointed to the country’s heavy reliance on imported finished goods despite exporting raw materials, arguing that the Bill could reverse this trend by promoting value addition within Kenya.
While largely supportive, some lawmakers raised concerns about the Bill’s potential impact on foreign investment if perceived as overly restrictive.
There were calls to clearly define “local” and “foreign” entities to prevent abuse, as well as to harmonize the proposed law with existing frameworks governing labor, immigration, and company operations.
Additionally, MPs emphasized the need for robust oversight mechanisms, including independent verification of compliance and transparent reporting systems.
As debate intensified, a motion was successfully moved and seconded to adjourn proceedings, allowing more members to contribute to the discussion at a later date.
The Speaker put the question to the House, with members overwhelmingly supporting the adjournment, signaling continued interest and engagement with the Bill.
If enacted, the Local Content Bill, 2025 could mark a turning point in Kenya’s economic policy, shifting focus toward self-reliance, industrial growth, and equitable participation.
“This is not just about legislation,” Kagiri said in her closing remarks. “It is about safeguarding our future and ensuring every Kenyan has a fair opportunity to contribute to and benefit from our economy.”
The Bill now awaits further debate as Parliament continues to scrutinize its provisions and implications.
