What Kenya stands to gain from trade with the Chinese

The just-ended Fifth Ministerial Conference of the Forum on China-Africa Co-operation (FOCAC) was held in Beijing.

Being the first in the second decade of this century, the conference served as a major link between the past and future in developing China-Africa relations.

The past three years since the last FOCAC conference in 2009 have witnessed the remarkable progress in China-Kenyan economic and trade cooperation as the Chinese government made great efforts in implementing the eight new measures it announced at the conference.

China has implemented the measures in various sectors that include medical care, human resource development, education, credit and financing, amongst others.

In terms of cooperation in medical care and public health service, China has funded the construction of the Malaria Prevention and Treatment Centre and the Mama Lucy Kibaki Hospital in Nairobi, and also provided 10 million rmb Yuan worth of medical supplies and equipment to the hospital. Another batch of medical equipment will be delivered soon.

In human resource development and education, China has gradually expanded the scale of the training programme for Kenyan officials and technicians and organised both multilateral and bilateral training courses.

Over the last three years, the number of trainees has increased steadily from 158 in 2009 to 398 in 2011. The training also covered a wide spectrum, including economy and trade, agriculture, medical service, communication and education.

With regard to co-operation in development and use of new energy, China will provide Kenya with 490 sets of small scale solar energy equipment, construct the Irati Small Hydropower Station and the Chemoisit Small Hydropower Station and drill seven boreholes in the Eastern and Rift Valley provinces.

China has offered concessional loans and preferential export buyer’s credit to support a large number of infrastructure and social development projects in Kenya, with the total credit amounting to billions of rmb Yuan.

These include Nairobi Eastern and Northern Bypass, Nairobi Southern Bypass, Nairobi-Thika Highway (Lot 3), Kenya Power Distribution Upgrading and Strengthening Project, Kenya E-government Project, Technical Industrial Vocational Entrepreneurship Training Project, Olkaria Geothermal Field Production Well Drilling and the Kenyatta University Teaching and Referral Hospital.

China has also offered a special loan to support Kenyan small and medium-sized enterprises in tea production, power generation, rural power grids and regional aviation, among others.

It has also made a rapid progress in the engineering contracting market since 1985 and Chinese companies have been building transport, communication and electricity infrastructure in Kenya to improve local conditions for economic growth and self-development.

The projects include Nairobi-Thika Highway, Marsabit-Turbi (A2) Highway, the new Unit 4 Passenger Terminal at Jomo Kenyatta International Airport and Berth No 19 at the port of Mombasa.

China has made investments in different areas, such as motorcycle and car manufacturing, energy development, building materials, real estate and tourism.

China’s increased investment saw it become the second-largest source of foreign direct investment in Kenya in 2011. The cumulative direct investment reaches $280 million.

With regard to development assistance, China has completed the construction of Moi International Sports Centre, JKIA-Uhuru Highway-Gigiri roads, Gambogi-Serem Road, and Rural Primary School.

In 2011, when Kenya suffered severe drought and famine, the Chinese government donated rice, flour, cooking oil and other basic necessities worth Sh1.8 billion.

In 2011, China-Kenya trade increased to $2.434 billion, a year-on-year growth of more than 30 per cent. China’s exports from Kenya reached $2.369 billion while the imports stood at $64.87 million.

At present, China is Africa’s largest trading partner. Meanwhile, Africa becomes the second largest overseas project-contracting market and fourth largest overseas investment destination for China.

China will continue to propose new economic and trade measures for strengthening China-Africa cooperation, further supporting Africa in developing economies, improving livelihoods and raising capacity building levels.

According to Kenya’s Vision 2030, tourism, manufacturing, clean energy, agriculture, construction, ICT and financial services are all the key development sectors. We would like to share our experience and enhance our cooperation in these areas.

Through concerted efforts of both sides, the bilateral economic and trade co-operation is bound to reach a new high and benefit both countries.

The author is the economic and commercial counsellor at the Chinese Embassy in Kenya.