International Market Factors Affecting the Performance of Small and Medium Enterprises in Kenya: 2000-2014

Successive regimes in Kenya have appreciated the significance associated with the SME sector as numerous policy initiatives have been introduced during the past decade to accelerate the growth and survival of SMEs. Although there has been a growing interest paid to the sector by the government of Kenya through a raft of policy actions, limited scholarly attention has been paid to the challenges Kenyan SMEs face in the international market environment from a foreign policy viewpoint. This study sought to answer the research question; is Kenya’s SME policy responsive to the international market factors affecting the performance of Kenyan SMEs? The general objective of the study was to investigate the international market factors affecting the performance of SMES in Kenya. The Specific objectives were two-fold: to establish the factors in the international market affecting the performance of Kenya’s SMEs and to examine the role of Kenya government policy on the competitiveness of Kenyan SMEs in the international market. The study is based on both secondary and primary data. The results show that the international market factors affecting SME competitiveness include global economic conditions, globalization, market integration and government policies. The study shows that Kenya’s government policy was not adequately responsive to these factors affecting the SME competitiveness in the international economy.