traditional mismatch constraint therefore comes into play. this requires a well developed mortgage market to address longterm funding requirements of the sector. developing mechanisms for long - term finance is good for monetary policy transmission as well. the mpc has been trying to address the issue of long - term finance ; we do hope this forum can provide some viable and feasible options. ladies and gentlemen : the government ’ s commitment to growth of real estate sector is in our blueprint for vision 2030 and is also well articulated in the finance bill, 2010. the finance bill outlines a number of measures to spur growth in the property market. in particular, in order to facilitate provision of adequate housing to kenya ’ s growing population, the finance bill, 2010 contains proposals to amend the banking act : ( i ) to allow mortgage finance companies to operate current accounts ; and ( ii ) to allow banks to advance up to 40 % of their total deposit liabilities up from 25 % for purchase, improvement or alterations of land. these measures will unlock the sector ’ s potentials by availing funding required to finance growth of real estate in kenya. the central bank will continue to work with the sector to improve the operating environment. it is equally important for the players in the real estate sector to design innovative ways of securing funds to exploit opportunities available. for instance, pension funds are needed for guaranteeing members ’ mortgages. this is happening in kenya, but still at a low scale. leveraging on such long - term instruments will lower costs and make decent and low cost housing available to potential borrowers. also, other investment vehicles such as unit trusts have the potential of pooling funds required for specific projects. in addition, the success of the kenya government infrastructure bond as well as other corporate bonds that have followed, demonstrates enormous potential of the bond market. in 2009 alone the government raised a total of ksh 54. 7 billion through bonds issues, and the infrastructure bonds were oversubscribed every time. this is a clear testimony of the market ’ s ability to provide cheaper source of funding for long - term projects such as mortgages. to further deepen the bond market, the central bank has implemented a number of measures, including introduction of benchmark bonds and re - opening of these benchmark bonds to create liquidity and facilitate trading. we can then use this infrastructure bond platform to develop housing bonds. ladies and gentlemen : in all this, a vibrant financial sector with adequate and dynamic human capital is a vital

the financial times. fdi into kenya by project numbers increased by 47 percent, reaching 84 announced projects, compared with increases in ghana ( 21 percent ), nigeria ( 19 percent ), egypt ( 14 percent ) and south africa ( 3 percent ). likewise kenya ranks high as a home country for fdi. in particular, fdi out of kenya by capital investment reached us $ 1 billion in 2015 placing it tenth in the middle east and africa region compared with u. a. e. ( us $ 21. 8 billion ), south africa ( us $ 2. 5 billion ), mauritius ( us $ 2. 1 billion ), and egypt ( us $ 1. 7 billion ). key trends on foreign inflows in 2015, reported in the economic survey, include : • fdi into kenya increased by 8. 4 percent to us $ 1. 5 billion in 2015 • portfolio investments declined from us $ 3. 4 billion to us $ 34 million in 2015 on the backdrop of the sovereign bond issuance in 2014 • other investment flows more than doubled from us $ 2. 2 billion to us $ 4. 6 billion in bis central bankers ’ speeches analysis by sector indicates that the top five recipient sectors of fdi inflows include : wholesale and retail trade, financial and insurance, manufacturing, construction, and electricity and gas supply. allow me now to touch on three global developments that are likely to have implications for foreign investment flows to our country. • first, the subdued global economic growth that has been worsened by the prolonged period of uncertainty relating to the slowdown and rebalancing of the chinese economy, lower commodity prices, and geopolitical developments and concerns surrounding “ brexit ”. consequently, global growth is now projected at a worrisome 3. 1 percent in 2016. the fact that central banks in advanced economies are maintaining an accommodative stance is a clear indication that the global economy has not yet recovered to sustainable levels. in addition, most of the emerging economies have faced volatile capital flows and exchange rates attributable to the accommodative policies, and the prospects of unwinding the unconventional monetary policies. • second, the ongoing divestiture of major international companies around africa, as reflected in a number of multinational enterprises downsizing their assets through outright sale and transfer to domestic companies, otherwise referred to as derisking. the main problem we observe with this process is the ambiguity and poor information flow on the measures by