It is projected that the e-commerce revenue in Kenya will reach Sh164 billion in 2021 and grow to Sh 254 billion by 2025.
The Cabinet Secretary for ICT, Innovation and Youth Affairs Joe Mucheru, said as the penetration of products grows, the profit margins are expected to reduce, a need he said requires e-commerce players to plan ahead to reduce cost drivers and increase technology-driven solutions.
Mucheru said that the Kenyan government, private sector entities, and other partners are supporting sustainability through digital training and skills for Kenyan youth eager to participate in digital markets and trade so as to sustain e-commerce.
The CS was speaking during the launch of the Kenya Private Sector Alliance (KEPSA) E-commerce Booster Portal Programme aimed at aiding the struggling Micro, Small and Medium-sized Enterprises (MSMEs) in Nairobi.
“We are doing this through the Ajira Digital Program in partnership with the Kenya Private Sector Alliance (KEPSA), the Mastercard Foundation, and eMobilis,” said Mucheru.
He added “The impact of this to our economy is that our citizens will possess high levels of digital and entrepreneurial skills, which will aid in tapping opportunities and overcoming setbacks in e-commerce”
The CS further revealed that the e-commerce sector has significant potential to create new jobs directly on online marketplaces, supporting services and spin-off economic activities.
‘If we are to aggregate the businesses that are carried out through social media platforms such as WhatsApp, Google, Facebook and Instagram among others the number of e-commerce start-ups are in their thousands”, the CS disclosed.
He noted that E-commerce also offers a vibrant marketing place where traders, buyers, consolidators and middle-men interact online, as well as a reliable and speedy logistics network capable of last mile delivery at reduced costs, and a trusted payment platform to accommodate customer categories and wallet transactions.
Mucheru at the same time revealed that Kenya’s is the 5th largest economy in Sub-Saharan Africa and was ranked 56 out of 190 economies in 2019 in the World Bank Ease of Doing Business.
The CS said that digitization of government contributed to an improvement in this ranking disclosing that a 2020 report by the Internet World Stats rated Kenya’s internet penetration as the highest in Africa with 87.2 percent of the population connected.
“As at September 2020, a survey conducted by the Communications Authority of Kenya noted that there were 59.8 million active mobile subscribers in Kenya; and in terms of its geographical location, Kenya is the “heart” of Africa”, the CS said.
The CS said that the government is supporting e-commerce through a three-pronged approach: – Adapt-Accelerate-Sustain.
- By KNA