NAIROBI,KENYA,NOVEMBER 19 — In the wake of increasing competition by foreign countries to control the African market, China is at it again.
The Chinese have shown determination to cement their position in East Africa by increasing their investments in Kenya, the East Africa’s economic power house.
This comes as Kenya continues to remain a major entry point into the region, with hundreds of multi-nationals keen to penetrate East and Central Africa setting base in the country.
In the latest developments, about 30 private sector players from China have landed in Kenya to pursue business and investment deals in the country which has in recent time recorded increased activities from the East.
China remains the leading lender to Kenya mainly in infrastructure development which includes the multi-billion Standard Gauge Railway (SGR) project, whose first phase-US$3.17 billion Mombasa-Nairobi stretch is operational.
Over 400 Chinese companies are currently operating in Kenya, a figure expected to continue growing as the country witnesses increased interest from Chinese investors keen to set base in Nairobi and other major towns.
ANHUI-KENYA BUSINESS FORUM
The companies and private entities from China’s province of Anhui are pitching tent in Kenya’s capital of Nairobi where they are expected to hold talks with their Kenyan counterparts, a move expected to strengthen trade and investment ties.
The more than 30 private sector players are being led by Anhui Province Vice Governor, honoring an invitation by Kenya’s Ministry of Industry, Trade and Cooperatives Cabinet Secretary Peter Munya.
Munya extended the invite in August this year during a visit to China where he met the Vice Governor.
Sectors covered by the Chinese delegation include textile, manufacturing, IT, agriculture, project contracting, building, chemicals, trading among other sectors.
“During the visit a business forum will be held where Kenyan entrepreneurs and their counterparts will have an opportunity to forge business partnerships,” a communiqué from the Kenya Private Sector Alliance (KEPSA) reads in part.
The main forum is set for tomorrow (November 20) at the Crown Plaza Hotel, Nairobi, with KEPSA rallying its members to capitalize on the event to seal trade and investment deals.
The companies from the resource-rich Chinese province include Anhui Minsheng Information Corp which focuses on the combination of production, study, research and development.
Another firm is Anhui Shui’an Construction Group Co., Ltd. (ASCG). This is a hydraulic engineering construction and installation corporation.
It is targeting to become a giant comprehensive joint-equity enterprise focusing on general contracting of construction works and integrating commercial investment, real estate development, hospitality, tourism, scientific incubation, factory building leasing and international businesses.
With a registered capital of CNY313.9 million (US$45.2million) and total asset base of CNY 5 billion (US$ 720.2 million), ASCG boasts an annual construction capacity of over CNY10 billion (US$1.4 billion).
Also among the visiting companies is Anhui jianghuai automobile group co. limited (JAC) which is one of the top 10 comprehensive vehicles manufacturers in China with full range of commercial vehicles, passenger car, new energy vehicle, core component and power train.
Others are Healthy Industrial and Trading Co. Ltd of Lu’An City (Guzhen Feather of Technology Factory of Lu’An City), Anhui Yanz Oils Co.Ltd, Anhui Hefutang tea co. LTD , Lu’AN Lv Jie Animal Husbandry Co., Ltd, Taihe County JingYing (Golden eagle) Economic and Trade Co., Ltd, Anhui Easy Business Digital Technology Co., Ltd and Anhui Foreign Economic Construction (Group) Co., Ltd. (AFECC).
Also visiting Kenya are Huafeng Cooperatives Company, Hefei Cement Research and Design Institute Corporation Ltd. (HCRDI), China Tiesiju Civil Engineering Group Co., Ltd., China MCC17 Group Co.,Ltd. (MCC17), China National Chemical Engineering Third Construction Co., Ltd., Anhui Transport Consulting and Design Institute Co . Ltd (ATCDI), China Coal Mine Construction Group Corporation Ltd and China Bengbu International Technology and Economic Cooperation Ltd.
Chinese Ambassador to Kenya Sun Baohong is expected to grace the occasion alongside Kenyan officials mainly from the Industry, Trade and Cooperatives ministry, led by CS Munya.
The Kenya Investment Authority (KenInvest) is expected to sign an MoU on “Doing Business In Kenya” with the Chinese entities.
Kenya and China have remained close trade and development partners. China’s exports to Kenya have more than doubled in the last five years closing at Ksh390.6 billion(about US$3.8 billion) last year, the Kenya Economic Survey (Kenya National Bureau of Statistics) 2018 data shows.
This is up from Ksh337.5 billion (US$3.28 billion) in 2016, a steady growth from Ksh182.4 billion (US$1.77billion) in 2013.
It now accounts for about 22 per cent of Kenya’s import bill which closed at US$16.5 billion (Ksh1.7 trillion) last year.
Kenya and other East African countries are reported to have borrowed over $29.42 billion from China in the past 10 years to grow their transport, energy, manufacturing and communication sectors.
Rattled by the Chinese growing command of the African investment and trade platform, the US government is counting on the recently formed International Development Finance Corporation (IDFC) to increase its investments in the continent, East Africa being among target regions.
President Donald Trump signed into law the Better Utilization of Investments Leading to Development (BUILD) Act of 2018, On October 5, which creates IDFC, a powerful tool for U.S assistance and foreign policy.
The IDFC is coiled towards supporting private investment and development projects in emerging countries, including backing private investment; a move that gives or rather empowers private entities which have previously struggled with funding.
East African countries stand a chance to be among the biggest beneficiaries of the IDFC which is seen as a tool to counter the growing Sino-African relations, which received a boost during the 6th Forum on China-Africa Cooperation.
During the Beijing forum in September this year, President Xi Jinping pledged an additional $60 billion in new development financing to African countries.