1. EPZA Value Proposition for BPO and ITES Sector Investors
Presentation for NASSCOM delegates on 17th Sept 2013,
Venue: Stanley Hotel.

2. PRESENTATION OUTLINE Introduction to EPZs Eligible EPZ activities
Status of Program
EPZ Value Proposition
EPZ service business opportunities
How to invest in service EPZs
How to invest in new ICT zones
EPZA contact

3. INTRODUCTION TO EPZS EPZs established under EPZ Act, CAP 517
Background:
EPZs established under EPZ Act, CAP 517
Program managed by EPZ Authority, a government agency under the Ministry of Trade
Scheme intended to:
provide for the promotion and facilitation of export oriented investment
address infrastructural and institutional constraints to efficient export-led production

4. ELIGIBLE EPZ ACTIVITIES
Activities licensed under EPZ:
Enterprise licences:
manufacturing or processing
commercial activities – trading, breaking bulk, relabeling, repackaging, regional distribution centres (no 10-year tax holidays, no domestic sales (EAC)
service – export related e.g. information, repair, brokerage, consultancy services excl. financial services (includes
BPO/ITES
Developer/Operator licence:
for development of zone infrastructure
EPZ Business Service permit:
for non-EPZ activities within the EPZs
providing support services e.g. banks,
catering, freight, consultancy e.t.c

5. SHARE OF EPZ INVESTMENT BY SOURCE COUNTRY
Foreign investors from: Bahrain, Belgium, China, Germany, Hong Kong, India, Netherlands, Qatar, Sri Lanka, S. Africa, Taiwan, Tanzania, UK and USA among other countries

6. SHARE OF EPZ ENTERPRISES BY LICENCE

7. SHARE OF ENTERPRISES BY SECTOR

8. EPZ BUSINESS INVESTMENT TARGET SECTORS
EPZ target sectors (1):
Electrical/Electronic :
Lighting, switchgear,
Consumer electronics,
transformers
Apparel & textile: fabric,
garments, accessories,
Cat. 9, sub-contracting
EPZ
ICT based services: call
centres, BPO/back office
operations
Humanitarian Relief
Supplies and Services

9. EPZ BUSINESS INVESTMENT TARGET SECTORS
EPZ target sectors (2):
Agro-processing: food,
fruits, fibres e.g. sisal,
flowers, fresh produce
Regional Corporate HQ
and corporate services
EPZ
Pharmaceutical and Medical
Supplies
Leather products: luggage,
footwear, apparel, wallets,
gloves

10. WHY INVEST IN Kenya’s EPZS? Value Proposition
Benefits of operating in Kenya’s EPZs
a) Improved competitiveness as a result of lower operating costs
b) Increased shareholder value due to increased profitability
c) Increased efficiency due to hassle-free operation
d) Increased employee satisfaction and productivity due to  convenient EPZ locations

11. WHY INVEST IN Kenya’s EPZS? Value Proposition : Benefits to You
(a) Improved competitiveness as a result of lower operating costs
Labor costs guided by minimum government wage rates and statutory deductions (starting at US$ 59/mo plus 15% housing in outlying towns to US$ 112 plus 15% in major cities).
Application fees (non-refundable US $250)
License fees (US $1000 for Enterprise licenses, $5000 for Developer/Operator licenses)
Rentals – land (USS 5,000 /ha/yr) & buildings (ranging from US $2-$3.50/ sqft/yr)
Utilities – exclude VAT

12. WHY INVEST IN Kenya’s EPZS? Value Proposition : Benefits to You
b) Increased shareholder value due to increased profitability, resulting from tax exemptions
10-year Corporate Tax holiday and 25% tax rate on profits thereafter (except for commercial activities)
10-year Withholding Tax holiday
Duty and VAT exemption on inputs
Stamp Duty exemption

13. WHY INVEST IN Kenya’s EPZS? Value Proposition : Benefits to You
c) Increased efficiency due to hassle-free operation as a result of reduced bureaucracy & faster project start up:
Operation under essentially one license issued by EPZ Authority
No minimum level of investment
Rapid project approval (under 30 days approval on application)
One-stop-shop service by EPZA for set-up, facilitation and aftercare (work permits, labour- relations, port, utilities etc.)
On-site customs documentation and inspection

14. VALUE PROPOSITION – Benefits to You
d) Increased employee satisfaction and productivity due to  convenient EPZ locations, with requisite infrastructure, close to housing and social amenities with 24 hour security,
Lease ready factory shells and start immediate operations - rentals range from $2-3.5/sq. ft/year depending on location
Lease serviced land for construction of customized buildings - Athi River EPZ offers 1ha plots for $5,000 land rent annually + service charge or $100,000 stand premium for 50 years
Set up own EPZ on own/leased land - EPZA physical requirements must be met

15. EPZ Export-Oriented Opportunities for NASSCOM Investors
Services
Software Applications Development
Customer support services including Call Centers and mobile phone data based customer care
Back office operations including data entry, accounting services, document editing,
Data mining, web design and web based research
Shared Service Centers for global ICT companies
Professional Consultancy including in ICT related fields

16. EPZ Export Oriented Opportunities for NASSCOM Investors
Services
Data Centers
-Animation and computer graphics
ICT related training

17. Opportunities for NASSCOM Investors
Real Estate Development (incentives apply)
Development of ICT compatible real estate
ICT Towers
ICT Office Park Campuses

18. HOW TO INVEST IN EPZ SERVICE ENTERPRISE
Investor makes enquiry on area(s) of interest
Investor submits a short project proposal
On acceptance, investor completes application form and submits with application fee of US$ 250
EPZA evaluates project and provides investor with letter of approval in principle within 30 days
Investor incorporates EPZ company, locates a zone, obtains environmental approval if required
Pays annual license fee (US$1,000) and gets license
Commences operations

19. HOW TO INVEST IN EPZ SERVICE ENTERPRISE
Major criteria for EPZ service enterprises
Export orientation (over 80% sales outside EAC partner states)
Local sales subject to Ministerial approval and taxes
New investment ( not conversion of going concern)s in Kenya)
EPZ location as primary place of business (not shell companies)
100% foreign shareholding allowed

20. HOW TO INVEST IN EPZs -Developers
Major requirements for New Zones including ICT towers and ICT parks
Individual land parcels on LR no. (not sectional title)
Land tenure > 30 years; Unencumbered title
Access roads, power and water supply suited to service-related activities
Limited tenancy by non-EPZs under Business Service Permits(BSP)
EPZA facilitates designation of land as EPZ by Minister for Industrialization & Enterprise Development
Investor pays license fee (US$ 5,000) and gets annual licence fee and begins operations!

21. We invite you to explore the attractive opportunities available
under our EPZ Program.
You can count on us for support!

22. Export Processing Zones Authority Athi River EPZ, Off Namanga Road
HOW TO CONTACT EPZ AUTHORITY
Chief Executive
Export Processing Zones Authority
Athi River EPZ, Off Namanga Road
P.O. Box Nairobi, Kenya
Tel: /2/3/4/5/6, Fax:
Website: