UK sets up Sh74bn war chest to fight for Nairobi exports

Britain Tuesday announced a Sh74 billion fund to help Kenyans import goods from the UK in the latest attempt to boost the falling business clout of the former colonial master that started with Kibaki’s presidency in 2003.

UK’s Trade envoy Lord Clive Hollick, who is expected in the country Wednesday for a three-day visit, is set to discuss details of the fund which also covers UK firms against risks incurred in exporting goods to Kenya.

UK Export Finance (UKEF) will coordinate the advance of loans to businesses and entrepreneurs to buy Britain made goods, especially for infrastructure related projects, ultimately boosting the import of British products to Kenya.

“Central to his discussions with the government will be UK Export Finance which has set aside up to £500m (Sh74 billion) to support trade with Kenya,” says a statement from the British High Commission in Nairobi.

Official data shows goods worth Sh40.1 billion were imported from Britain in the 11 months to November, down from Sh41.3 billion in a similar period in 2014.

The drop saw the UK slip two positions in the rank of Kenya’s top sellers, behind Germany and Saudi Arabia in terms of doing business with East Africa’s largest economy.

The UK was the ninth largest seller of goods to Nairobi, behind China (Sh295 billion), India (Sh228 billion), the US (Sh117 billion), the United Arab Emirates (Sh81 billion) and Japan (Sh80 billion).

READ: Cameron warms to Uhuru in push for better ties with Kenya

Britain is losing out to China, India, and Japan whose share of business with Kenya has been on the rise.

These countries target Kenya with clothing, vehicles, electronics and pharmaceuticals — which also top the UK’s dealings with East Africa.

India and China have grown trade with Africa nations helped by the low cost manufacturing and increased diplomatic dealings which have seen the two countries secure multi-billion shilling deals, especially in the public sector.

Relations between Nairobi and London came under focus following threats by the former colonial master to cut ties should Uhuru Kenyatta, then an ICC indictee, be appointed president in the 2013 elections.

The charges against President Kenyatta have since been dropped.

The UK has recently been keen to reset the frosty relations with Nairobi with Prime Minister David Cameron set to visit Kenya this year.

The cooling of business relations with the UK started during President Kibaki’s tenure with the country looking East, mainly China, for better deals and unconditional aid.

The policy has seen Britain lose out on lucrative deals with the government such as supply of police and government vehicles.