US Raises Red Flag Over Kenya's Fake Land Titles

In Summary

• US flags fake land titles as a growing risk to investment in Kenya.
• The government has expanded SHIF benefits and increased funding after public pressure, with membership rising from 8 million to 21 million.
• MPs launch a probe on employee deductions, saying salary deductions have left thousands of public workers earning below legal limits.
• The Gates Foundation withdraws from the Host Country Agreement with Kenya but will continue its operations in the country.
• CBK cuts benchmark lending rate to 10.0% to lower borrowing costs and support private sector credit growth.
• Kenya keeps the foreign investor capital limit at Ksh12.9 million to remain competitive.

In a report by The Business Daily, the United States government has flagged the rise in fake land title deeds in Kenya as a major concern for foreign investors, citing it for the first time in an official trade report. The US Trade Representative warns that investors risk being duped with fake or double-issued land titles, especially when leasing undeveloped land, due to fraud involving rogue brokers and government officials. The fraud has caused banks and businesses to lose billions through court battles and fake securities. The Ministry of Lands has promised reforms, including digitising land records, to curb fraud, but progress has been slow due to resistance from cartels and some lawyers. The issue has now gained international attention and could influence future trade discussions between Kenya and the US.

The government has responded to growing public concerns by improving the Social Health Insurance Fund (SHIF) benefits, including raising cancer treatment coverage from Ksh400,000 to Ksh550,000 and ICU services from Ksh4,480 to Ksh28,000, while also allowing access to primary health care and emergency services for all Kenyans. The move, according to The People’s Daily, comes as SHIF membership hits 21 million—up from 8 million under NHIF—with Ksh81.7 billion allocated for SHIF premiums in the 2025/26 budget, alongside funds for maternal care, elderly persons with disabilities, and a digital health rollout. Despite the progress, challenges like delayed stipends, missing equipment, and low county engagement remain.

Members of Parliament have launched a probe into why thousands of public servants are left with less than one-third of their salaries after deductions, which they say violates the law limiting pay cuts to two-thirds of basic income, as reported by The Eastleigh Voice. The Public Accounts Committee (PAC) raised concerns over the increased burden on civil servants due to new deductions including the 1.5% Housing Levy, 2.75% Social Health Insurance contributions, and higher NSSF rates introduced under the current administration. PAC has summoned the National Treasury to explain the breach of Section 19(3) of the Employment Act, 2007, which protects employees from excessive deductions. MPs have asked the Treasury to consult with the Attorney General on whether to amend or scrap the one-third salary rule, as they argue it is no longer practical under the current tax regime. A recent payroll review showed that 4,082 civil servants received less than the legal threshold in June 2023, raising alarm over continued violation of labour laws.

The Gates Foundation has agreed to withdraw from the Host Country Agreement (HCA) with the Kenyan government following ongoing legal proceedings regarding diplomatic immunity granted to the Foundation. Despite the withdrawal, the Foundation will continue its operations in Kenya, where it has worked for over 20 years on health and economic initiatives. The decision, according to The Standard, comes after the Kenyan High Court directed the government to provide evidence within 21 days regarding the revocation of the diplomatic immunity granted to the Foundation. The Foundation emphasised that the legal case had distracted from its core mission and its commitment to working with Kenyan communities and partners remains unchanged. It will continue branch office operations in Kenya, transitioning away from the diplomatic privileges under the HCA.

The US government has criticised Kenya for imposing high taxes and strict regulations on maize imports, making it hard for American exporters to access the local market. The US Trade Representative pointed out that Kenya’s 50% import tax on maize from outside the East African Community (EAC), combined with tight safety rules, blocks most US maize from entering the country. The Business Daily reports that despite the potential of the Kenyan maize market, valued at Ksh6.47 billion and expected to grow by 30% by 2027, US maize is seen as uncompetitive due to these restrictions. Kenya’s rules include strict limits on aflatoxin and moisture content that are tougher than international standards, further discouraging US exporters. Kenya temporarily waives some of these taxes during food shortages, like the recent approval of 5.5 million bags of yellow maize imports to ease pressure from rising white maize prices, which have jumped over 26% in three months. However, the US says these temporary measures are not enough and wants fairer access for its farmers.

The Central Bank of Kenya (CBK) has reduced the benchmark lending rate to 10.0% from 10.75%, marking the fifth straight cut from the peak of 13% in 2023. According to The Easteigh Voice, the move comes as inflation remains low at 3.6% in March 2025, prompting CBK to ease borrowing costs and support private sector lending, which is still subdued. The Monetary Policy Committee also narrowed the interest rate corridor around the benchmark rate from 150 to 75 basis points to make borrowing costs more stable and predictable. CBK noted that the average lending rates have been falling since December 2024, but the response in credit growth has been slow. The next policy review is set for June 2025.

Kenya has withdrawn a proposal that would have raised the minimum capital requirement for foreign investors from Ksh12.9 million to Ksh64.6 million, in a move aimed at attracting more international firms, especially those in sectors that rely more on expertise than money. The Kenya Investment Authority (KenInvest) said it made the decision after consultations with stakeholders, noting that keeping the current threshold will help encourage serious investors without locking out knowledge-based businesses. The revised Investment Promotion and Facilitation Bill 2025 also introduces faster approval processes for key investments through a “green channel” to ease delays caused by multiple government authorisations. Kenya is under pressure to improve its appeal to foreign investors as FDI inflows continue to lag behind neighbours Ethiopia and Uganda, as reported by The Business Daily.