On 12^th August 2024, Kenya Private Sector Alliance Foundation (KEPSA Foundation) and Center for International Private Enterprise (CIPE) hosted a Digital Economy Stakeholders Forum, bringing together representatives from the public and private sectors along with development partners. The forum marks the conclusion of a key initiative, where the responsibility for tracking the government's progress on its Digital Economy manifesto in relation to the 3 key issues highlighted in CIPE’s 2022 Policy Brief: Digital Skills, Cost of digitizing and Cybersecurity was formally handed over to the KEPSA Foundation, who will continue with advocacy efforts going forward.

During the event, CIPE Country Director, Mr. Ben Kiragu, highlighted the work CIPE has done in empowering Private sector leadership in Digital economic transformation and in enhancing Private Sector Participation in democratic governance.   

The final Digital Economy Matrix Score Card was released, focusing on three critical areas: Digital Skills training and development, Cyber Security, and the costs of digitizing which are among the pillars of the Kenya’s digital masterplan on Digital Economy transformation. The tracking of the digital economy scorecard was a collaborative effort, with CIPE partnering with KEPSA Foundation and receiving support from a technical working group of industry stakeholders, who contributed to monitoring and assessing progress throughout the initiative.

“For Kenya to thrive in the digital economy, it is essential to foster a policy environment that supports innovation, ensures data privacy, strengthens infrastructure, builds capacity, and improves access to finance” according to Mr. Patrick Obath, Chairman of the KEPSA Foundation.

Since the release of the last scorecard in April 2024, the Cyber Security focus area recorded a 4-point improvement with 55% achievement recorded, with significant progress noted in legislation. "There seems to be a lot of attention and actioning of significant milestones, with the Office of the Data Protection Commissioner (ODPC) taking the front line, especially in implementing the Data Protection Act, 2019," observed Mr. Mohamed Gharib, ClerkMaster Consulting.

In contrast, progress in Digital Skills remained stagnant at 57% achievement. While coverage and participation appeared to have increased, the curriculum was found to be shallow and not competitive enough to meet current market needs. The cost of digitization has also remained high and stagnated at 40% achievement recorded. This is driven by both macro and microeconomic factors. To address this, the KEPSA Foundation will continue to advocate for reducing import duties and other taxes to help lower the costs of devices and connectivity.

“With the digital economy projected to contribute up to 9.24% of Kenya's GDP by 2025, the scorecard will play a vital role in tracking and accelerating this growth. It aims to establish robust digital foundations, which will be crucial for the nation's long-term success in leveraging the digital economy as a catalyst for economic growth, job creation, and improved service delivery, while ensuring that no sector is left behind”, emphasized Ms. Mercy Meme, Assistant Director at the Ministry of ICT and Digital Economy.

Mr. Harun Rashid Khator, Director of Administration at the Ministry of Agriculture and Livestock Development noted that by leveraging technology, farmers can optimize their production processes, reducing wastage and increasing yields. Mr. Khator added that digital technologies enable real-time monitoring and data-driven decision-making, which are crucial for maintaining the quality and safety of agricultural products. Ultimately, he said, the adoption of the scorecard matrix in agriculture is expected to transform the industry, contributing to sustainable and profitable farming practice.

"KEPSA Foundation will continue championing digital transformation in Kenya, with a particular focus on empowering underprivileged communities, including women, youth, and persons with disabilities in business, to help them optimize their potential. We remain committed to tracking the progress of the Government Agenda to acknowledge achievements, identify persistent and emerging gaps, and leverage KEPSA’s convening platforms to advocate for the adoption of recommendations that support a transformative approach to the digital economy." Said Gloria Ndekei, KEPSA Foundation Executive Director.

Some of the notable improvements include;

• On nurturing digital talent, the Ministry of Information, Communication, and the Digital Economy (MoICTDE), under the Ajira Digital Program, had trained over 516,505 individuals in digital skills as of April 2024 with about 800 youths having been trained through the Presidential Digital Talent Program. Further, the Konza Technopolis, through the Jitume initiative, had established 117 centres across the country to teach digital skills. By June 2024, the program had connected over 28,000 users, enrolled 8,700 in various courses, and facilitated the creation of 118 digital job platforms.
• To improve the digital curriculum in universities, the Ajira Digital Program had trained a cumulative 516,505 youths across 1,120 universities and TVET institutions since 2020. By the end of 2023, this initiative had created over 152,711 digital jobs, with at least 119,462 youths connected to online employment opportunities. Additionally, 16,804 devices have been delivered to 176 digital lab institutions, as part of a broader plan to deploy 23,000 computers in technical and vocational training institutes.
• On the Digital Superhighway, out of the planned 100,000 kilometers of fiber optic cable rollout, aimed to be achieved through a Public-Private Partnership (PPP) model over five years, approximately 25,000 kilometers have been completed to date. Of this, the government has successfully laid down 10,219 kilometers of fiber optic cable. Additionally, 135 public health facilities have been connected to the National Optical Fiber Backbone Infrastructure (NOFBI), and Local Area Network (LAN) systems have been implemented in 57 public hospitals. The government has on-boarded an estimated 17,668 government services to the e-citizen portal as part of the digital superhighway agenda.
• To bolster Broadband Coverage, an additional 155 Wi-Fi hotspots have been installed at the University of Nairobi as part of its ICT initiative under the theme "Making the University Vibrant and Sustainable through Digitalization." Additionally, 274 digital hubs have been established, with recent installations including the Ruiru Jitume Digital Hub, targeting 4,500 youths under CCI Kenya, and the Jitume Digital Hub at Butere Girls High School. The Ministry of Information, Communication, and the Digital Economy (MoICTDE) has also begun rolling out Jitume hubs across 185 TVET institutions nationwide. This initiative aims to equip youth with digital skills and provide access to digital jobs.
• To enhance National cyber-protection system, in addition to the Data Protection Act of 2019 and the Computer Misuse and Cybercrimes Act of 2018, the Blockchain Association of Kenya (BAK) has prepared and submitted a proposed bill—the Virtual Assets Service Providers Bill 2024. This bill, now under consideration by the Finance and National Planning Committee, aims to establish clear regulations for trading digital assets, protect investors from digital asset scammers and fraudsters, and generate additional tax revenue through capital gains. The Capital Markets Authority (CMA) is proposed to serve as the regulator if the bill is passed into law.
• Further on data protection, The Office of the Data Protection Commissioner (ODPC) had Issued 60 enforcement notices, eight (8) penalties and six (6) fines since being operationalized in 2019. The ODPC had achieved a complaint resolution rate of 75% against over 5,300 data protection related complaints majorly related to use of personal data by data handlers. Notably, September 2023, ODPC imposed fines of Ksh 9.3 million on three distinct businesses found guilty of breaching data protection regulations.
• Finally, Cisco, a multinational technology company, opened a new Cybersecurity Technology Experience Centre at the University of Nairobi in Kenya. This center was established in collaboration with the Information and Communication Technology Authority (ICTA) and the University of Nairobi. According to Cisco, the center will serve as a space for customers and partners to deepen their understanding of cybersecurity controls at the enterprise level and within cloud platforms, customized for each customer. Additionally, the center will provide opportunities to learn more about Cisco's solutions, while leveraging advancements in artificial intelligence (AI) and virtual reality.
• It is also worth noting that out of the planned establishment of three data centers, which are expected to significantly boost Kenya's digital infrastructure and support cloud computing in Kenya and the East African region, none have been constructed so far. The government is currently facing funding challenges for the construction of these digital hubs and has allocated an additional KES 10 billion to the Constituency Development Fund (CDF) for the construction of ICT hubs in each ward. Furthermore, there is a pressing need for regulators and standardization bodies within the cyberspace sector to develop standards that promote the harmonization and interoperability of innovations. This would ensure a cohesive and efficient digital ecosystem.