What drives Japan’s renewed interest in Kenya

Japan is focusing on infrastructure projects, food production, trade and investment projects as it seeks to reposition itself as a strategic partner of Kenya and other African states.

The initiative is informed by the waning influence of Japan and Japanese businesses even as other emerging powerhouses such as Brazil, Russia, India and China spread their influence.

For Japan, the renewed drive is informed by the Tokyo International Conference on African Development (TICAD IV) initiative, which lays down the road map for the next five years.

Business Daily spoke to Japanese Ambassador to Kenya Shigeo Iwatani.

Japan is actively engaging in infrastructure projects, a shift from its previous ‘soft’ projects. What informs the change of strategy?

The focus on infrastructure projects is informed by the TICAD IV initiative which has economic infrastructure as one of its main pillars. This covers rural electrification and modernisation of transport facilities. The other pillars are on human security, health, environment, trade and investment.

Explain the importance of TICAD IV to Kenya?

TICAD is a policy forum for African Development with the main focus on the areas mentioned. TICAD IV will see Japan double its Official Development Assistance (ODA). Under the TICAD IV platform, Japan has launched the CARD (Coalition for African Rice Development) initiative which commits to double rice production in 10 years from 2008.

This involves introduction of the New Rice for Africa (NERICA) variety which is drought resistant, matures faster and has higher yields.

In Kenya the Mwea irrigation project is a beneficiary. We are funding it at a cost of Sh12.11bn. We are looking to extend the project to other rice schemes in the country.

Which key local project is Japan funding?

Our focus is on the critical energy and transport sectors which will allow unlocking of the country’s economic potential. In terms of infrastructure, we are focusing on transport and electricity. We are funding the Olkaria geothermal project and rural electrification using solar. We will provide solar panels to 20 selected public facilities such as health centres and schools. These sites will allow the public to enjoy the services for instance by charging their mobile phones.

In terms of transport, we are involved in the expansion of the Mombasa port container terminal to enable more ships to dock. We will also fund the Nairobi-Western-Ring-Road circuit, which will involve upgrading roads in Westlands, Kilimani and Lavington.

Japan’s private sector is not well represented in Kenya. What is the Japanese government doing to enhance its involvement?

The TICAD IV initiative is expected to push the Japanese private sector to enhance its participation by increasing investment. Currently, the main focus of Japanese businesses has been China, India and other emerging markets.

However, Japanese businesses are raising their stake not only in Kenya but also Africa. Kenya is likely to attract interest as a hub for regional expansion due to its relatively developed status.

What is the main focus of the upcoming Kenya-Japan annual conference?

The conference brings together various government ministries and agencies and the Japanese government and its agencies. It is a forum where we review projects implemented in the last one year. The forum is also a platform where the Kenya government shares with us some of the projects they would want our involvement.

Whereas there are no pledges made at this point, the forum allows for policy dialogue and sets the pace for future engagement.

Is their provision a post-harvest programme to address losses associated with lack of proper storage facilities at the Mwea rice project?

The project includes mainly construction of a dam and canals. The programme does not have a post-harvest component, but we intend to look at it in subsequent funding. However, we have been involved in such programmes especially in the horticultural sub-sector where we have constructed eight cold storage facilities for small scale farmers across the country.

What measures are in place to address fund misuse?

Most of the projects we fund are overseen by Japan International Co-operation Agency (Jica). Jica monitors the projects, while independent auditors are designated to ensure fairness and competitiveness of the procurement process.

Limited transfer of knowledge has been cited as a major challenge in post-implementation of technical projects. What is Japan doing to address this issue?

Japan has contributed not only towards loan and grant aid projects but also provided technical assistance to Kenya. Japan has extended technical cooperation which includes dispatch of technical experts, training programmes, provision of equipment and materials to facilitate technology transfer, and technical cooperation for project work.

Following the coming into effect of the East African Community Common Market Protocol, is Japan looking at engaging in regional programmes?

Japan is undertaking regional projects that will enhance the integration process. For instance, Japan is funding the ongoing Nairobi-Arusha road construction project by funding the Namanga-Arusha section. Similarly, we are funding the construction of a one stop border post at Namanga and Malaba that will allow state bodies such as the revenue collectors and customs to work under one roof.

This will eliminate the current state where they work in their respective countries which has been blamed for delay in the clearing process at border points.

Japan has seconded experts to the EAC secretariat to assist in capacity development and also donated to the EAC partnership fund.

China’s influence in Africa is growing fast and it’s using its local businesses to carry out infrastructure projects. Is Japan planning to do the same?

Japan ,which is a member of the Organisation of Economic Co-operation and Development (OECD) is required to open projects it sponsors to international competitive bidding.
We are encouraging Japanese companies to compete with the rest as we cannot favour them in awarding project contracts. However, it’s important to note that China, which is a developing nation, has a lot to share in terms of experience.