Kenya’s waste problem SME opportunity we mustn’t miss

Kenya is throwing away an economic opportunity worth billions of shillings every year. Food is lost before it reaches consumers, organic waste piles up in markets and farms, and valuable materials are still treated as rubbish. Yet small businesses across the country are proving that waste can become jobs, income, fertiliser, cleaner energy and climate resilience.

I first learnt this lesson long before “circular economy” became a policy phrase. When I was in primary school, my father ran a small flour milling company. The mill produced flour, but what did not become flour was not discarded; it became animal feed, popularly known in Kenya as jenga. Every by-product had value.

At the time, we did not call it circularity. We called it good business. That lesson matters today because Kenya loses about 5.2 million tonnes of food annually, valued at roughly Sh72 billion. In a country where food security remains a national concern, this is not just waste. It is lost income for farmers, higher costs for consumers and avoidable pressure on land, water and energy.

The opportunity is already visible. Agricultural residues are being turned into organic fertilisers, food waste into bioenergy, and biomass into cleaner cooking fuels. Recyclers, repair businesses, compost producers and resource recovery enterprises are creating value from materials that would otherwise be dumped.

Kenya has also put important policy architecture in place, including the Sustainable Waste Management Act, 2022, the Extended Producer Responsibility Regulations, 2024, and the Green Economy Strategy and Implementation Plan (2016–2030). The question is whether the SMEs expected to deliver this transition are accessing the finance, technology and incentives they need. Too often, the answer is no.

Recent analysis under the O-Farms initiative, implemented by Bopinc together with Biovision Africa Trust and Unconventional Capital, and funded by IKEA Foundation, shows that 60 per cent of SMEs report limited access to finance, 63 per cent struggle to access appropriate technology, and 78 per cent say certification systems are too costly and complex.

Most worrying, only 18 per cent report meaningful access to circular economy policies and incentives. Kenya may therefore have strong policies on paper, while leaving out the very entrepreneurs who can turn them into practical, scalable solutions.

That is a risk Kenya cannot afford. SMEs are central to job creation, innovation and local value chains. If they remain outside the circular economy mainstream, Kenya will struggle to reduce post-harvest losses, improve food security, meet climate goals and build new green industries.