Economy

Traders seek new ventures in talks with Nigeria tycoons

dangote

Aliko Dangote, Africa’s richest man at JKIA on September 5, 2013. Photo/William Oeri

Kenya businesses are upbeat about striking mega deals with Nigerian tycoons during a meeting scheduled for today in Nairobi, which will be presided over by Presidents Uhuru Kenyatta and Goodluck Jonathan.

About 150 local business executives from various sectors have been selected to engage the Nigerian delegation during their three-day visit, which is also expected to see the two presidents sign several bilateral trade pacts.

“Judging from previous informal engagements, there is a lot of excitement both from our side and the 100 delegates from Nigeria that the Nairobi meeting will unlock huge trade opportunities,” said Laban Onditi, the vice chairman of the Kenya National Chambers of Commerce & Industry (KNCCI).

Trade between Kenya and Nigeria has been slowed down by a maze of regulations that have prevented entrepreneurs from following business leads.

Kenya currently shares its market with 18 other East and Southern African states (Comesa) while Nigeria remains a key player in the Economic Community of Western African States (Ecowas).

Presidents Kenyatta and Jonathan had in July overseen the signing of three protocols that laid foundations for the budding diplomatic and commercial ties.

(READ: Kenya, Nigeria sign deals to boost trade)

At the time, Foreign Affairs secretary Amina Mohamed and her Nigerian counterpart Olugbenga Ashiru inked a Joint Commission for Co-operation, a protocol on trade consultations and an MoU on mutual co-operation between the Foreign Service Institute of Kenya and the Foreign Service Academy of Nigeria.

On Friday, the two presidents are expected to sign fresh protocols covering travel visas and reducing tariff and non-tariff barriers that have stalked trade between the countries.

The chamber will also sign an MoU with its Nigerian counterpart on joint investments and trade missions.

Among the Nigerian industrialists in President Jonathan’s entourage are Aliko Dangote of Dangote Group and banker-cum-philanthropist Tony Elumelu. Dangote is looking for a limestone mining licence in Kenya.

“From the calibre of delegates, this is set to be a big event in the calendar for business in this country,” said KNCCI chairman Kiprono Kittony.

The local business community believes only bilateral pacts can dismantle the administrative barriers that exist between the two trading blocs.

The local firms see Nigeria as a possible market for long-life milk, horticulture, tea and coffee where Kenya enjoys comparative advantage over its newfound friend from West Africa.

“Belgian firms currently import and repackage milk powder from New KCC plant in Eldoret for export to Nigeria because it is more profitable that way than going directly through existing regulatory framework,” said Mr Onditi.

Demand

The business community also maintains that surveys done in Nigeria have also shown great potential for horticulture, coffee and tea with Kenyans selling such items informally on the streets of Lagos reporting huge demand.

On Thursday, executives of Kenya Airways (KQ), one of the first companies to benefit directly from President Kenyatta’s July visit to Abuja said it was working on modalities to boost connectivity between the two nations.

The July deal allowed KQ to launch a direct flight to Abuja once the two countries agree on an aviation pact.

“We are already working on the modalities and I can confirm that KQ management will introduce a direct flight to Abuja between October and December next year,” an official conversant with the matter said.

On its part, Nigerians see Kenya as a possible market for its crude oil, fertiliser and financial services.

In the financial services, Nigeria already has a strong presence that includes UBA Bank group and Continental Reinsurance which are operating in Nairobi.

The Guaranty Trust Bank has expressed interest in buying 70 per cent of Kenya’s Fina Bank while rating agency Augusto & Co. has been licensed to operate in Kenya.

(READ: Nigerian bank eyes oil deals after Fina acquisition)

Two years ago, the Nigerian life insurance company Capital Express Assurance bought majority shareholding in Capex Life Assurance, formerly known as Trinity Life Assurance.

On Thursday, government officials said the talks will focus on trade, economic development, and agriculture and tourism development.

Apart from the wealthy businessmen, President Jonathan will also be accompanied by ministers in charge of foreign affairs, agriculture and rural development, industry, trade & Investment, interior, petroleum resources and culture, tourism & national Orientation.

[email protected]