Artificial intelligence (AI) is no longer a technology of the future. It is transforming industries, improving productivity and creating new economic opportunities. For Kenya, the question is no longer whether to embrace AI, but whether its regulatory framework is ready to support local innovators.
Micro, Small and Medium Enterprises (MSMEs), the backbone of Kenya's economy, are increasingly developing AI solutions. Yet many innovators face a major obstacle: the absence of a structured environment where they can safely test AI systems before commercial deployment. This uncertainty raises compliance costs, discourages investment and slows innovation.
A practical solution is the establishment of AI regulatory sandboxes. These are supervised environments where developers can test AI technologies under regulatory oversight before they enter the market. Sandboxes enable innovators to refine products while allowing regulators to identify risks and shape practical, evidence-based rules.
Globally, regulatory sandboxes are becoming central to AI governance. The European Union's AI Act requires member states to establish AI sandboxes by August 2026, while the OECD encourages regulatory experimentation to promote responsible innovation. Kenya has introduced ICT regulatory sandboxes through the Communications Authority, but it lacks an AI-specific framework tailored to MSMEs.
