Sustainable Urban Economic Development (SUED) Programme
Working with Kenyan Local Governments to Strengthen Partnership with the Private Sector
Contextualisation: SUED’s Strategic Approach to Municipal Engagement
The Sustainable Urban Economic Development (SUED) programme, funded by the UK government, has been a catalyst for inclusive economic growth in Kenya’s secondary towns. SUED’s approach is rooted in the belief that local governments are not just administrative entities but strategic enablers of private sector investment. By strengthening municipal capacity, aligning urban planning with climate resilience, and unlocking anchor investments, SUED has created a replicable model for sustainable urban development.
Key components of SUED’s strategy include:
• Urban Economic Plans (UEPs): These plans identify priority value chains and infrastructure projects tailored to each municipality’s economic potential.
• Seed Fund Mechanism: SUED provides concessional finance to de-risk early-stage investments and attract private capital.
• Municipal Collaboration: SUED works directly with county governments to streamline regulatory processes, co-finance infrastructure, and foster investor confidence.
This approach has mobilized millions in public and private investment, transforming urban economies and livelihoods across Kenya.
Case Studies: Municipalities Driving Investment Through Partnership
Kisii Municipality: Integrated Waste Project
SUED partnered with Green Leaf Services Ltd to establish a climate-resilient Integrated Waste Management Facility in Kisii. The facility includes a Material Recovery Facility (MRF) and a Black Soldier Fly (BSF) unit for organic waste conversion.
County Government Contributions:
• Co-financing the project alongside SUED, demonstrating fiscal commitment.
• Providing land for the facility, reducing capital expenditure and accelerating implementation.
• Facilitated regulatory approvals, including environmental licensing and zoning.
• Offered technical support through county engineers and planners.
This project exemplifies circular economy principles, turning waste into value while creating green jobs and improving urban sanitation.
Lamu Municipality: Cashew and Fish Processing Projects
Lamu County has demonstrated proactive investment facilitation through its support for two anchor projects:
Equatorial Nut Processors (ENP): Cashew Nut Processing Plant Project
• Allocated land for the cashew processing plant in Hindi.
• Provided agricultural extension services, including seedling distribution and farmer training.
• Committed to infrastructure upgrades to support logistics and operations.
Diamond Seafood Kenya Ltd (DSF): Sustainable Fish Harvesting and Processing
• Provided shoreline land for the fish processing facility.
• Supported cold chain development and marine infrastructure.
• Partnered on training and equipment provision for artisanal fishers.
These projects are revitalizing Lamu’s blue and green economies, creating jobs and enhancing value addition in agriculture and fisheries.
Kerugoya Municipality: Hydrobox Small Hydropower Project
Hydrobox Kenya is deploying a 703KW run-of-river hydropower plant along River Thiba in Kirinyaga County. The modular, containerized design enables rapid deployment and remote monitoring.
County Government Contributions:
• Fast-tracked permits for water abstraction and energy licensing.
• Facilitated engagement with national agencies such as EPRA and the Ministry of Energy.
This clean energy project will power agro-processors, schools, and households, aligning with Kenya’s green growth agenda.
Eldoret Municipality: Moisoy Maize Milling Project (Futuristic Framing)
The Moisoy Maize Milling Plant is envisioned as a transformative agro-industrial hub in Uasin Gishu County. With a budget of Ksh 477 million, the facility will process over 10,000 MT of maize annually.
Planned County Government Support:
• Will provide additional funding to bridge capital gaps and catalyze private investment.
• Will facilitate land acquisition and upgrade access roads and utilities.
• Will integrate the project into the county’s food systems strategy.
Once operational, Moisoy will enhance food security, reduce post-harvest losses, and create 200 direct jobs, benefiting over 20,000 farmers.
Malindi Municipality: Fruit Drying Facility
SUED is supporting Milly Fruits Processing Ltd to establish a climate-friendly fruit drying facility in Malindi, Kilifi County.
County Government Contributions:
• Streamlined land acquisition, ensuring clear titles and zoning compliance.
• Expedited environmental impact assessments and building permits.
• Committed to infrastructure upgrades, including road access and utility connections. The facility will process mangoes, pineapples, and coconuts for export, supporting 4,000 farmers and creating 4,000 jobs while reducing emissions and post-harvest losses.
Conclusion: Lessons and Opportunities
SUED’s work across these municipalities demonstrates a replicable model for local governmentprivate sector collaboration. Key success factors include:
• De-risking investments through land provision, co-financing, and regulatory support.
• Building investor confidence via transparent processes and technical assistance.
• Aligning projects with climate resilience and inclusive growth to ensure long-term sustainability.
As Kenya continues to urbanize, empowering local governments to act as investment enablers will be critical to unlocking sustainable development and economic transformation.